Study Notes

1 July 2017 Student accommodation is booming in the UK, but creating an affordable offering in the heart of London was always going to be challenging. Paul Jarvis talks to UPP about how they did it

Student accommodation is a booming market right now. As more and more universities look to differentiate themselves and offer increasingly discerning students more bang for their tuition fees, providing high quality places for them to stay has become a major part of that battleground.

But that doesn’t mean it is always a straightforward proposition. Creating new properties that are of a high enough quality to attract the best, and yet also affordable to students, can be a tough ask no matter the location.

When the new accommodation needs to be in the heart of London, where property prices are among the highest in the country, that task can seem insurmountable.

Over the past few years, investor UPP has shown that, with some clever thinking and innovative approaches, nothing is impossible.

Its partnership with the University of London has delivered one of the most striking student accommodation properties anywhere in the country, marrying the need to be sensitive to its surroundings on the outside with the requirements of modern students on the inside.

Established in 2013, the partnership has seen UPP design and finance the Garden Halls development in Bloomsbury, just a few minutes’ walk from King’s Cross St Pancras and Euston stations, overlooking a quiet public garden on what would generally be considered prime real estate. The top floors offer views across the capital that would usually go for millions if sold on the open market.

“If it wasn’t for the partnership that we have [with the University of London], we wouldn’t have been able to do it,” admits Jon Wakeford, director of strategy and communications at UPP. “The cost of rents in London would have made it unaffordable.”

Rent at Garden Halls, which opened its doors to students at the beginning of the 2016 academic year, starts at £189 per week. Most of the rooms are £205 per week.

As a comparison, the average rental value in central London for a one-bed flat is over £450 per week, while even a studio comes in at over £300.

“The big thing for us is to show that you can get something away in Bloomsbury that is affordable and of good quality,” says Wakeford.

Built on the site of previous halls of residence and incorporating the refurbishment of the Hughes Parry Tower student accommodation property at one end of the development, the new accommodation provides 1,200 rooms – an increase of 187 bed-spaces on the previous building – with a mixture of catered and non-catered accommodation. It also includes a garden café, cinema room, music and games rooms.

Term-time occupancy rates stand at 99%, demonstrating that the site at the heart of Bloomsbury is hugely popular with students.

Meanwhile, UPP took over management of the gardens in front of the main square, refurbishing the tennis courts and opening the space up to the public as well as student residents.

So how did UPP manage to deliver such a scheme in this location that has proved popular with students?

As Wakeford points out, being in partnership with the university was crucial. Another key aspect of the arrangement is the ability for the university to generate its own income from the site. On the ground floor there are four conference rooms that can be let out by the university for events.

Furthermore, when the students are away over the summer, the rooms are of a sufficient quality that they can easily be let on the open market as rooms for visitors. In an area that includes three Premier Inns and a host of other hotels in roughly half a mile radius, demand is strong.

“We are effectively a B&B for four weeks over the summer holiday,” says David Berry, a regional director at UPP Residential Services. “In this location there is always plenty of demand.” This approach also increases flexibility for students. “It means the university can offer 40-week contracts instead of 50-week ones,” says Wakeford.

However, one of the biggest factors in creating a development that was financially affordable was in the design. With a façade that reflects the surroundings, from the outside the long front aspect could hint at a modern addition to such nearby historic buildings as the British Library or British Museum.

But this property has blended the classic look with some modern innovations and design features.

As Wakeford says, it is certainly not a building that you would highlight as an obvious student accommodation property from the outside. Part of this is of course down to the requirements of the location within the Bloomsbury Conservation Area, requiring it to fit into and reflect the local heritage.

But this did not mean that old-fashioned building techniques had to be used. “The brickwork was made in an old railway shed in Stoke and then transported down to the site,” explains Berry. “That meant it could be done ahead of time and it was not weather-dependent.”

As you would expect, though, the biggest design innovations come inside the building – and once again the fact that UPP is in partnership with the university proved crucial. “We were involved in the design from a very early stage and that meant that, for example, we moved the parcel room from its location on the original design, which was at the other end of the building from the reception area,” says Berry. “That way we didn’t have to employ people simply to ferry parcels from one part of the building to another all day long.”

The student rooms themselves are relatively small compared to older student accommodation in the country, and while this may be in part down to maximising profits by getting more students in, both Wakeford and Berry highlight that modern student living is no longer about sitting in your room for much of the day.

“Students want more and more study areas outside their rooms,” says Berry.

“There is a lot of space for peer learning, which is now very popular,” adds Wakeford.

And Berry is at pains to point out that UPP has been eager to tackle typical student bugbears by bearing down on costs for them, such as damages. “We went through all the things that students end up having to pay out damages for and looked at how we could design those things out as much as possible,” he explains.

One prime example here is the carpet in the students’ rooms, which is laid in smaller sections, rather than a single piece per room. “Should a student damage an area of their carpet, we are replacing a smaller amount so the charge is therefore less than if we had to take up the carpet in the entire bedroom,” he says.

Even in the refurbished Hughes Parry Tower – which could not be demolished due to the requirements of the planning agreement – UPP has managed to make some important changes.

“The building is therefore constrained by its physical footprint,” says Berry. “From the outside you would not be able to see any difference to what was here before. In fact, it’s a few inches thicker than before because of the improved insulation.”

Making this building work on a constrained site, in one of the most valuable real estate locations in the world, shows just what can be done in student accommodation when you get the partnership right.

This page was last updated on:
4 September 2017.

thumb

Fáilte Project Ireland 2040

The industry has welcomed (Fáilte) the ambition of the Irish government’s National Development Plan, albeit with a healthy degree of scepticism as to its implementation

thumb

‘A Great Journey’

Phillip Hall, MUFG’s head of structured finance for EMEA, tells Paul Jarvis how the bank is evolving to thrive in the changing PPP world

register

Register now to get un-restricted access to all sections of the website.

Want to see more first? Try our free preview...