UK: Student accommodation specialist Unite Group has reported record earnings in its results for the year to 31 December 2023.
The company posted an eight per cent rise in adjusted earnings per share to 44.3p (2022: 40.9p). This was influenced by practically full occupancy of 99.8 per cent across its portfolio of assets and 7.4 per cent rental growth for the 2023/24 academic year (2022/23: 99.3 per cent and 3.5 per cent).
The company said that it was confident in delivering rental growth of at least six per cent for 2024/25 (previously guided at least five per cent), with reservations for the 2024/25 academic year already at 80 per cent.
It has provided guidance for three to five per cent growth in adjusted earnings in 2024 to 45.5p – 46.5p, while it expects that earnings growth to accelerate from 2026 as development completions increase.
The group has a record £1.3 billion development pipeline, with £569 million committed for developments in Russell Group university cities at a 6.5 per cent yield on cost, a £250 million joint venture agreed with Newcastle University, and a future development pipeline of £452 million at a 6.7 per cent yield on cost.
The group’s portfolio was valued at £5.51 billion, up 1.2 per cent over the year on a like-for-like basis (2022: £5.397 billion).
Joe Lister, Unite Group chief executive, said: “This is a strong set of results, driven by full occupancy, rental growth and substantial investment into our platform and portfolio. Our pipeline of developments, asset management projects and our new university partnership present a substantial growth opportunity for the business.”
“The supply-demand imbalance of student accommodation is acute and continues to intensify. We play a leading role in tackling this shortage, easing pressure on the wider housing market and freeing up homes for families. Our development and asset management pipeline stands at a record £1.3 billion and we are taking an innovative approach to delivering more homes for students. University partnerships provide a compelling opportunity to deliver new, high-quality accommodation and our first joint venture with Newcastle University is only possible for a business of our reputation, scale and development expertise. We are trusted by students, parents and universities to deliver high-quality, safe and affordable accommodation where it is needed the most. Our strong leasing performance supports continued earnings growth in 2024 and we are confident that our all-inclusive offer, student support programmes and balanced approach to rental increases will continue to provide real value for money,” he added.
