STUDENT HOUSING: The future of real estate investment

The lack of adequate faculty housing has always been an unsolved question in the Italian real estate market, always legging behind the European average. This delay is quantifiable in 75 thousand beds, for an estimated investment of over 4 billion euros.

The student housing represents a profitable investment compartment for the companies operating in this sector, which had a 6,5 billion market value in 2017. At the moment, Italy only has a 7 million market share, but presents a constantly growing demand: not only for Italian students living away from home, but also for foreign students, who have doubled in the last 15 years and reached the 100 thousand quota in the academic year 2016/2017.

As written by Evelina Marchesini in a recent article published on “Il Sole 24 ore” some data highlight why Italy is still in last place in Europe: the ratio between number of beds and number of students is below 3%, with respect to 23% in the United Kingdom. Furthermore the number of university students still living at home is 75%; this percentage is dramatically higher than in Finland (5%) and other European countries as the UK, where it is lower than 20%.

In particular less than 2% of the students lives in student housing, compared to a 19% European average. After all, the alternatives offered to students in addition to family accommodation are not many in our country, considering the high rents and the low quality living conditions that cannot provide all the common spaces typical of student housing (study rooms, libraries, gyms and so on).

At the moment, Italy is presenting more than 10 projects aiming at the realization of new student accommodations, and many others are still in a feasibility study phase. In particular, from a first analysis, the Italian investments are focusing on:

• Turin: where Camplus wants to arrive at managing over 2000 beds;
• Milan: where the American group Hines has already started to work on two projects near University Bocconi;
• Bologna: where The Student Hotel is planning to open a new structure in 2019;
• Rome: where TSH is planning to open two locations by the end of 2020;
• Florence: where TSH is planning to open two other structures in addition to the recently inaugurated “Firenze Lavagnini” which has opened at the end of June.

Other important initiatives that should be taken into account are the campus that will be created in the former EXPO area and several projects by Cdp, which is developing student housing projects all over Italy. Among the most active operators Fabrica Immobiliare Sgr should be mentioned, with its 4.500 student beds portfolio.