Adelaide facing significant student accommodation shortage3 April 2023
Adelaide is facing a student accommodation crisis that could provide an opportunity for a Build to Rent (BTR) development, according to JLL Research.
SA’s Director of Strategic Research, Rick Warner said Adelaide’s record low residential rental vacancy rate is expected to create a significant opportunity for a student accommodation and BTR developers.
“With current Purpose Built Student Accommodation (PBSA) options nearing exhaustion, international students in Adelaide will be faced with entering a residential rental market already exhibiting undersupply,” he said.
Mr Warner said student demand was growing rapidly and Adelaide did not have enough space to accommodate this requirement.
He said the post-pandemic Adelaide student market grew 10% in 2022 to 37,838 students and this growth trajectory is expected to be maintained in 2023 due to an influx of Chinese students instructed by the Chinese Government to return to face-to-face classes at overseas universities.
According to JLL Research, there are currently 7,000 PBSA beds in Adelaide and only 300 new beds planned between 2023 and 2025.
Mr Warner indicated that the expected increase in residential apartment delivery over the medium term is unlikely to alleviate the current residential rental pressures.
JLL Research: Inner Adelaide Apartment Supply, 2016-2026
JLL Capital Markets Executive, Claudia Brace said there were sites available for BTR and PBSA development around Adelaide’s key education and research precincts.
“This imbalance of demand and supply in the student accommodation sector is ultimately going to create even more competition in Adelaide’s already tight residential leasing market,” Ms Brace said.
JLL has been appointed to sell a 957 sqm mixed-use development site in Crowther Street, located near the emerging BioMed City precinct and university precincts for both UniSA and Adelaide Uni.
“The site allows for a 43 metre high development that, subject to council approval, could be suited for many uses including BTR, PBSA and hotel accommodation,” Ms Brace said.