The student accommodation sector is experiencing a surge in demand as the number of students in Spanish universities keeps rising.
Since 2015, the numbers of students have increased by 11% reaching 1. 7 million students in 2023 with the main regions of Madrid, Catalonia and Valencia outpacing the national average with rises of 14%, 18% and 21.5% respectively.
The rise in the number of students is also driven by international students, with a strong increase in the number coming from Europe and Latin America.
Foreign students accounted for 11% of total students in Spanish universities in 2023, having increased by 81% since 2015.
Barcelona, Madrid and Valencia appear in the QS Best Student Cities 2023 ranking, which showcases the best urban destinations for international students out of 164 worldwide cities.
While more students looking for accommodation, the lack of quality supply should offer opportunities for the development of new projects. The Spanish student housing market remains structurally undersupplied, with less than 110,000 beds according to DBK.
Despite challenging market conditions, investors and operators continue to expand. Student Experience has opened its first residence in Spain, in the Madrid region, which represents the beginning of the international expansion of the Dutch developer and property manager after more than 10 years of experience in the Netherlands. The company has five other projects under development in the country to host 5,000 students.
A partnership consisting of Amro Partners, IP Investment Management and Heed Capital has acquired beginning of this year a €30 million gross development project purpose-built student accommodation project in Valencia. The project will deliver 221 student beds on a circa 2,000-square-metre site.
The Boost Society, owned by Axa IM Alts, has announced the acquisition of two plots for the development of student accommodation in Cadiz and Valencia for 388 students.
Other Living Formats
Beyond student housing residences, investors are developing complementary offering that targets different customer bases.
Hines European Value Fund 3 has signed a forward sale and purchase agreement with Grupo Inmobiliario Sacresa for the acquisition of a licensed hotel tower in Esplugues de Llobregat near Barcelona, The property will house over 520 rooms with different types of flexible accommodations comprising studios, shared rooms and one and two bedroom flats. The asset will be managed by Aparto, the student residence platform owned by Hines. The target audience includes both students and young professionals.
Different flexible accommodation formats are emerging. The German coliving company, Habyt, is set to open a property in Madrid with a total area of 2,9000 square metres and 128 rooms. The Spanish capital is one of the strategic locations for Habyt’s global expansion.
Cohabs, the Belgium operator, is opening its first two co-living buildings in Madrid this year, totalling more 50 bedrooms.
The flex living model, which began to develop in cities such as Madrid and Barcelona, is making inroads in other areas such as the coast and islands, where the product is more holiday-oriented and aimed at other types of customers such as digital nomads.