Unite Group reports strong occupancy, rental growth

(Sharecast News) - Student accommodation operator Unite Group provided an upbeat trading update on Thursday, reporting a robust 99.7% occupancy rate for the 2023-2024 academic year. The FTSE 100 firm said that was a notable increase from the 97.9% occupancy rate reported in the 202-2023 academic period.

It also recorded rental growth of 7.3% for the new academic year.

On the property valuation front, the company said the Unite UK Student Accommodation Fund (USAF) saw a slight rise of 0.2% in property values.

In contrast, the London Student Accommodation Joint Venture (LSAV) recorded a marginal dip of 0.2%.

"We have delivered record occupancy and strong rental growth for the 2023-2024 academic year, with increasing demand from both students and universities reflecting the growing attractiveness of our fixed-priced, all-inclusive offer," said chief executive officer Richard Smith.

"The strong letting performance increases our confidence in delivering at least 5% rental growth for the 2024-2025 sales cycle and supports our property valuations as the market adjusts to an environment of higher interest rates."

Smith said the UK needed more suitable student accommodation as HMO landlords continue to leave the market at pace.

"As the leading provider of purpose-built student accommodation, we have a crucial role to play and are uniquely positioned to address this supply need.

"We continue to work closely with universities to ensure students have access to high quality, affordable accommodation."

At 0917 BST, shares in Unite Group were up 0.74% at 887.5p.

Reporting by Josh White for Sharecast.com.