Four blocks of student digs in the centre Brighton are up for sale for at least £67 million. The tallest has 13 floors.
Specialist property company Scape Living is looking to offload the blocks in Circus Street which have a total of 450 bedrooms and are let to student services company Kaplan Brighton until 2040.
Student rents start at £239 a week, with some costing more than £350 a week, bringing in an estimated rental income of more than £100,000 a week or £5 million a year.
The estate agency Knight Frank is marketing the student blocks which were part of a wider £130 million scheme on the site of the old fruit and veg market.
The purpose-built student accommodation – or PBSA – cost £70 million by the time it was completed three years ago.
It was worth more than £77 million in 2020, according to a market report, with the restrictions imposed during the coronavirus pandemic having dented occupancy levels.
But this week, Knight Frank said that the student rooms were 100 per cent occupied for the 2023-24 academic year.
The estate agency said that the site had 450 student rooms including 81 studios, 366 ensuite rooms and three one-bed flats.
The site covers nearly two and a half acres and includes 1,130 sq ft of retail space which is currently occupied by White Cloud Coffee Roasters.
The owner of the four student blocks, Scape Living, is part of APG, the biggest pension fund in the Netherlands.
The Brighton scheme had been owned by a specialist investment business called GCP Student Living – sometimes known as Gravis Capital Partners. GCP was taken over by an APG-led consortium in July 2021.
Merelina Sykes, joint head of student property at Knight Frank, said: “Brighton has one of the highest student ratios of all university towns and cities across the UK, with students making up 11.7 per cent of the total population.
“Despite being one of the highest-density student markets in the country, PBSA in Brighton only caters for around 34 per cent of full-time students – meaning demand heavily outweighs supply.
“As a result, schemes like this one offer an excellent opportunity for investors and we expect to see strong interest following the launch.”
I was just wondering what to do with the £67m burning a hole in my pocket
Heh. I was thinking if I had close to £70 million, I wouldn’t look at this personally for my portfolio.
It’s now many years since I was a student at Sussex, but I can still do the maths here.
If you pay £239 per week, then that’s nearly £1,000 per month in rent.
The £350 per week rooms are then £1400 per month, and you then need money to feed yourself and to pay for your phone etc.
So, to be a student nowadays, you might need an income of £25K+ per year, just to get by?
Is this building really ‘fully let’, at those prices?
Or is the developer now dumping a failed concept?
The true value of any city centre tower block will be as individual apartments. and not as a student let building.
The ‘student let’ build bubble has got to burst soon.
The current ‘shared ownership’ housing schemes seem just as dodgy to me. People certainly aren’t getting much of an investment for their high outlay.
Overseas students often come from very wealthy families and they are paying double this in some student blocks and you need a much higher income than £25k a year to get by with fees included. In London their families frequently buy them central London flats.
One thing to add to that is that students typically don’t rent the entire year, so take out the summer months, but still, it is a huge cost attached to going to university.
The lowest rents are for those who pay for 51 weeks in the smallest units without an en suite bathroom or much of a view. Shorter durations, like 41 weeks, come at a higher price. The figures above are fairly cautious and also don’t count on full occupancy, even though Knight Frank say occupancy is 100per cent this year.
Shared ownership is an interesting concept, the big trick unfortunately is the uncontrolled service charges attached to them.
These wouldn’t be SO houses, more likely HMOs if they were to go onto the market. I’m sure there would be a number of homeless supported accommodations who’d benefit from more properties, housing benefit would easily cover rent for rooms being about £350 a week approximately last I checked.
Yeah it’s mostly foreign students who can afford them and you don’t need to be a genius. To figure that out!!
They may struggle to find a buyer as the top end of student accommodation is overprovided for in most cities and some developers have gone bankrupt.
Every developer assumes all students are rich or will put themselves into debt for the next 20 years to have their own studio with an en-suite.
These developers are increasingly finding they have overestimated their market. Or done no research in the first place. Overseas students are sick of being regarded as cash cows and with a slump in Chinese students coming over post-pandemic, desperate university recruiters are increasingly looking to India for less rich pickings.
This is what the Tories wanted, only the rich to go to University. But then, the ex went to Brighton and dropped out way back when. He’s now an international dj and that…..so one might say you naysayers are all moaning minnies
Or perhaps those wanting to go to university accept that they have to fund the experience and choose a subject that will get them a job to pay it back.
Alternatively skip higher education and get a job with vocational training.
So academic subjects can just die out? Cracking idea
Are you moaning about people moaning?
Ah, Norman got lucky to breakthrough, the success of one can’t be compared to the struggles of many more, it’s anecdotal at best!
Still, you make a good point that University is but one path people can take. Access to vocation is something I’ve actually looked much into in Brighton. Might be interesting to see where the opportunities for improvements are…
Massive shortage of student flats but really this location isn’t good. I know people who moved out of this development due to students playing loud music late at night. The city desperately needs to get flat building on a massive scale to get a grip of demand. And they really need to get a grip of the student visa game. So many just come to work and do a meaningless degree in the hope it leads to a job in the UK and then they don’t have to go back.
Have you had a chance to look at what the student demographics are for Sussex and Brighton? It’s quite insightful, and not what you’d expect!
Hmm. So what degrees are they doing that would enable them to afford this rent once graduated? Evidently not allied healthcare roles. 7 years into my NHS healthcare professional role and I can say that I could never afford to live here.
I was reading research into what the livable, comfortable salary is in recent years, you’d have to be earning approximately £45,000 on your own. That’s about several years into a Band 7?
People who work and contribute to the city need homes desperately and this is people who are not students whats wrong with an apprenticeship and getting paid but learning valuable skills young people who mostly on lower wages are needing a home these are who should be helped more I
Have no objection to a student who is doing a worthwhile degree but some are just wasting time on such stupid degrees
They’ve made these places too small and too expensive for regular folk. Have to hope the companies go bankrupt and the creditors knock them into larger flats
Society should be about consent not forcing people to fill roles… If someone wants to study art or philosophy then they should be free to do that… it’s ultimately not their problem that you want a plumber who charges slightly less…
Well said. The problem here isn’t the students. We must remind ourselves that, like the article suggests, we need a threefold increase in student accommodation.
That’ll release standard housing properties, and help ease the pressures on housing stock in the city. It’s not a complete solution, but part of a difficult puzzle.
Meanwhile there is a lack of affordable housing and a large homeless population in the city.
Which is helped by having sufficient student accomodation. Brighton hasn’t achieved that yet.
Ben
Complete rubbish, far too many ‘Student’ accommodation going up, Lewes Road several sites, London Road, Moulescoomb, Sussex University itself to name just a few, how many of these ‘new builds’ released other properties ?
You are strawmanning the issue to fit your statement. Naming a few places doesn’t negate the aspect that there is not enough to house the student population, so they are going into the private sector.
You need a lot more housing to start seeing a difference you’re asking about. About 10x more of what we have now, based on the last figures I saw at least.
Affordable housing is a thing of the past in England. Too many people after too few houses. That’s why the price is sky high and will continue to be so with an ever increasing population due to net migration. Demand will never cease at this rate, even if we build to the edge of the country.
A quick google reveals the UK population’s growth rate is only about 0.5% per year. That’s as near as dammit completely stable, though migration is the largest driver of growth. Figures according to the ONS.
Characterising this as an “ever-increasing population due to net migration” isn’t a lie per se, but it doesn’t really cover the salient facts. We have the wrong kinds of housing, concentrated in the wrong hands, and an aging/dying population that would be shrinking without migration.
The price is sky high because we have no political will to lower those prices, in turn because our government is chock full of people made personally wealthy by the current prices.
Would you mind elaborating on your last sentence – the political will to lower prices. Do you mean by building more houses?
0.5% a year may not sound like a lot but that’s another 275k people who need a place to live every year going forward? Where will they live, where are these properties? How does the governments lower property prices? The government can’t magic up lower property values when there is a high demand. If you have 10 people and 20 houses. The additional 10 houses are worth nothing because nobody needs them. Supply and demand (basic economics).
So if they cost £70m, were once estimated to be worth £77m and are on the market for £67m they are already selling at a loss. And let’s new honest, estate agents always bump the asking price up so I doubt they’ll go for £67m.
I used to work just up the road from there and would walk through the buildings every day. I cannot believe they have 100% occupancy (unless nobody ever turns their lights on) and only a couple of the commercial premises are occupied.
I do wonder if the student housing bubble has burst and all the rich kids from Asia and (increasingly) Africa are going elsewhere for their university education?
I would love to see these buildings redeveloped into ‘regular’ housing but of course they are private developments on private land so any change would be economically driven.
Does anyone know what planet Benjamin lives on?? Firstly, two unis in one town (and Brighton itself is really a town, despite the city name) is one too many. Uni of Sussex has been around here for decades, fine, but Brighton Uni is just an amalgamated blob of ex-colleges and polys.
Secondly, what evidence does he have that building yet more ugly student blocks to accommodate all these students frees up family housing? In my street I have one student HMO next door and three directly opposite. Were these students to go into the blocks (and they would be more expensive per head in at least a couple of cases than the HMOs), then the houses would be on the market for around half a million or quite a lot more, and I would suggest that no average family could in any way afford that. He should put up some compelling facts and figures or just shut up, frankly.
I would suggest that the vast majority of us don’t want loads more purpose-built and very ugly student accommodation to house the ever-increasing number of students, many of whom are doing Mickey Mouse degrees which will never be of any value and earn proper income, but instead we would like far fewer students and an end to the proliferation of student blocks that are a total ugly blot on the Brighton landscape.
It isn’t necessary for all young people to go to uni. I didn’t. I went out to work at 16 with just O levels and did A levels and a degree at evening school much later. In my job (pre the degree) we had a fair few graduate trainees join us at work, and without exception they were totally devoid of any life experience or any basic concept of a work environment and how non-graduates with a brain operated (very well actually and far better than the graduates) in the work environment.
You could just simply ask, happy to back up my comments with data, no need to throw a tantrum!
Combined, both universities put together have approximately 36,000 students based on their self published population data.
Simple logic will inform you that if you have less than 36,000 purpose built rooms, then the remainder will go into private.
Of course, it’s a simplification, lots of other variables, but we ain’t here to read essays.
And unfortunately to your other suggestion, just because you cannot see the value of university, doesn’t mean there isn’t. And likewise, university might not be for everyone. But again, that’s not a valid argument against students, it just comes across as bigotry.
What is being done to help the housing crisis in this city? The only new builds seem to be student high rise blocks. Its sad to hear that a family are sleeping rough in a park in Brighton in winter. Whats being done to help the most vulnerable in our society…
There is also a plan for ‘co-living’ in Brighton which is basically student halls for adults. Its $1500 a month for a room with a pull down bed. I hope BHCC can see this for what it really is. Putting profits before people.
Nothing is being done, sadly, Stella. I very much hope and pray (although I’m not religious at all) that someone finds this family in the park or wherever as soon as possible – the ‘authorities’ do seem to be doing their best -, but we all have very horrible memories of the couple and the poor little new-born baby who died in similar exposed circumstances, with the parents now in custody and awaiting trial. This should not be happening anywhere, but it is.
Most of us, very probably, want to see decent and affordable homes for locals, but all we seem to get are student blocks for the greedy Unis (mainly Brighton Uni) and developer proposals for luxury ‘mini-cities’ (e.g the pathetic luxury flats in the Marina and the totally gross and unacceptably monstrous proposal for Brighton Gasworks – a mini-Manhattan skyscraper complex, which would be totally unaffordable for anyone who is very justifiably wanting or needing an affordable home here.) This has to stop, but heaven knows how we can stop it.