"The limited number of the existing stock of PBSA and the quality of these that is often not fit for purpose, under-scaled or inferior to what is currently demanded by students in terms of quality of accommodation and basic services/amenities has increased investor interest."
- Cushman & Wakefield, 2022
Tenant demand for high-quality student accommodation is strong, especially in under-supplied, yet internationally popular university cities. Purpose-built student accommodation (PBSA) bed supply meets less than 10% of the demand of Italian out-of-region and international student numbers; one of the lowest coverage rates in Europe*.
Italian undergraduate student market in MIUR (Ministry of University and Research, Italy) accredited universities, institutes & academies:
c. 1.85m total students per year, consistently increasing of c. 9%**
c. 100k international students per year, consistently increasing**
note: the numbers above do not include the student enrolment of private programs and universities
PBSA is significantly under-supplied, with approximately 65,000 PBSA beds of varying size and quality, only c. 22% are managed by private operators*. The majority of the PBSA managed by the university and charitable operators are not aligned to international practices and standards.
Italy is a top academic destination for students worldwide: 36 of its universities rank in the 2021 QS World Rankings and it is home to the oldest university in the world.
* Cushman & Wakefield, ** MIUR (Ministry of University and Research, Italy)
The majority of international investment into European student accommodation has, over the past 20 years, been directed to the UK student accommodation sector (much of which has been directed towards the London area, although some excellent opportunities exist throughout the UK).
The recent hardening of yields in the now mature UK student accommodation sector, plus the ultra-low interest rate environment, has increased investor interest in Continental Europe. Large-scale entry into the market is difficult, especially in Italy.
With offices in Italy, as well as London, Domatia is actively engaged in this market. In Italy, there are significant opportunities to start to address the serious imbalance between supply and demand, particularly for international students in historic city centres.
Italy has recently been rated in the US as the world's No 1 international student destination.
Domatia acquires, develops, invests in and operates European property, with a primary focus on delivery as modern purpose-built student accommodation (PBSA) and other forms of communal living.
Assets acquired to date are located in the historic centre of Florence, Italy. These will deliver some 331 beds in 2022, positioned in prime locations, benefitting from quick access to several academic institutions, public transportation including the train and tram station.
Having begun operations in Florence, we are researching, negotiating and interested in purchasing PBSA opportunities in other Italian university city centres.
These could comprise:
development opportunities for us to implement, with planning permission already obtained
developments for purchase on practical completion
developments for forward funding
We also seek to build relationships with regular development partners to work with us in joint ventures to enable a seamless process from initial site evaluation through to the first student checking in.
Please contact us if you wish to discuss specification requirements in more detail.