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Trading update and Q4 fund valuations

12 January 2022

Unite Students, the UK’s leading owner, manager and developer of student accommodation, today announces an update on current trading alongside quarterly property valuations for the Unite UK Student Accommodation Fund (‘USAF’) and the London Student Accommodation Joint Venture (‘LSAV’) as at 31 December 2021.

Current trading

Higher Education sector update

Latest guidance from the Department for Education confirms that education settings will remain open for face-to-face teaching under the Government’s Plan B measures to combat COVID-19. In our properties, over 70% of checked-in students have already returned to their accommodation, which is in line with a typical year. We expect the remaining students to arrive shortly, following the start of the spring term.

All of our properties remain open and operational and we continue to employ a range of measures in our buildings to reduce transmission of COVID-19 where possible. This includes enhanced cleaning and physical and social distancing measures, as well as offering support to those students needing to self-isolate.

2022/23 reservations

Across the Group’s entire property portfolio, 60% of rooms are now sold for the next academic year (58% at the same time last year). We expect strong student demand for 2022/23 from both domestic and international students but anticipate a slightly later sales cycle for international students than in a typical year due to uncertainty relating to COVID-19. As a result, we have increased our focus on retaining existing direct-let customers, which has led to an increased share of sales to re-bookers.

This is supportive of our guidance for full occupancy and rental growth of 3.0-3.5% for the 2022/23 academic year.

Development pipeline update

We continue to make good progress in the delivery of our secured pipeline and in sourcing new development opportunities. There remains a positive flow of development opportunities in London and prime regional cities which meet our return requirements and we expect to add further schemes to the secured pipeline during H1 2022.

Quarterly fund valuations

At 31 December 2021, USAF’s property portfolio was independently valued at £2,867 million, a 1.6% increase on a like-for-like basis during the quarter and a 4.6% increase for the year. The Q4 valuation increase in USAF is principally driven by an 8 basis point reduction in property yields. The portfolio comprises 29,523 beds in 75 properties across 20 university towns and cities in the UK.

LSAV’s investment portfolio was independently valued at £1,819 million, up 3.1% in the quarter on a like-for-like basis and up 10.4% for the year. The Q4 valuation increase in LSAV is driven by rental growth of 0.5% and a 12 basis point reduction in property yields. LSAV’s investment portfolio comprises 9,716 beds across 14 properties in London and Aston Student Village in Birmingham.

The USAF and LSAV portfolios are now valued at weighted average yields of 5.2% and 4.1% respectively. Yield compression in the quarter reflects strong investment activity in the sector, particularly for London and prime regional assets. As a result, we expect the valuations of our wholly owned portfolio at 31 December 2021 to reflect yield compression in H2 2021 comparable to the USAF portfolio.

Joe Lister, Unite Students Chief Financial Officer, commented:

“Bookings for the 2022/23 academic year have started positively with 60% of rooms already sold, demonstrating the continued strength of student demand and our success in increasing the retention of existing customers. This supports our guidance of a return to full occupancy and 3.0-3.5% rental growth for the 2022/23 academic year. Reflecting this positive outlook, we continue to see strong investment demand for UK student accommodation, as reflected in the valuation performance for USAF and LSAV in 2021.”

For further information, please contact:

Unite Students

Joe Lister / Michael Burt                                                      Tel: +44 117 302 7005

Unite press office                                                                 Tel: +44 117 450 6300


Justin Griffiths / Victoria Heslop                                         Tel: +44 20 7250 1446

About Unite Students

Unite Students is the UK’s largest owner, manager and developer of purpose-built student accommodation, serving the country’s world-leading Higher Education sector. We provide homes to 73,000 students across 173 properties in 25 leading University towns and cities. We currently partner with over 60 Universities across the UK.

Our people are driven by a common purpose: to provide a ‘Home for Success’ for the students who live with us. Unite’s accommodation is safe and secure, high quality and affordable. Students live predominantly in ensuite study bedrooms, with rents covering all bills, insurance, 24-hour security and high-speed Wi-Fi. We also achieved a five-star British Safety Council rating in our last audit.

We are committed to raising standards in the student accommodation sector for our customers, investors and employees. This is why our new Sustainability Strategy, launched in 2021, includes a commitment to become net zero carbon across our operations and developments by 2030.

Founded in 1991 in Bristol, Unite Group is an award-winning Real Estate Investment Trust (REIT), listed on the London Stock Exchange and a member of the FTSE 250 Index. Unite is invested in and operates two specialist funds and joint ventures with institutional investment partners: the £3 billion Unite UK Student Accommodation Fund (USAF) and the £2 billion London Student Accommodation Vehicle (LSAV).