Are UK universities at risk of bankruptcy?

Place North West reports that there are growing concerns that major UK universities will go bust, which could have disastrous knock-on effects for the economy and property industry, particularly in the North. 

The government has cut university funding and capped tuition fees, causing a higher education funding crisis. As there is currently no cap on fees for international students, universities have been trying to raise funds by recruiting students from overseas. However, due to factors such as Covid and the government's crack-down on immigration, international student recruitment has been steadily falling. As a result, about a third of universities are now operating at a loss.

There are growing concerns that universities could be forced to pull out of joint property ventures due to monetary issues. However, Adam White, executive director and Northern public sector lead at CBRE has a more optimistic view, arguing that universities are unlikely to be deterred from participating in the development of science and innovation campuses so long as the 'project's vision is strong and the commercial case is compelling'.

There is also concern that a university's financial troubles could have a negative knock-on effect on the local economy in the host city.

Student accommodation is also a challenging area for universities' finances. Maintaining in-house student accommodation is expensive and time-consuming for universities. As universities face financial difficulties, more are expected to outsource their accommodation. According to Richard Ward, Head of Research at StuRents, this is a good idea. He states, 'Universities should be considering working more closely with PBSA developers to ensure they can continue to attract students'.

Read the full article to discover the full picture facing universities on Place North West.