Two Scottish cities set for hundreds more student flats amid 'significant' supply shortage

Work is to push ahead with two £30 million new-build student flat projects in two Scottish cities as the sector continues to attract investment and buck the wider property market.

Mosaic Architecture + Design has submitted a planning application on behalf of Courie Investments for the £30m redevelopment of an existing office building at 249 West George Street in Glasgow. Due to “structural issues” the building is to be demolished and the site redeveloped to provide purpose-built student accommodation (PBSA), providing a mix of 147 flats and related amenities.

The site overlooks Blythswood Square within the Glasgow city centre conservation area. Developers said the scheme would provide a south-facing rear landscaped courtyard, while upper levels would benefit from two smaller roof terraces, providing space for “exercise, relaxation, interaction and study”.

Andrew White of Courie Investments said: “There remains significant demand for student accommodation – according to Savills research there are four students for every PBSA room available in Glasgow for the 2023/24 academic year. The problem is expected to worsen, with the student age population in the Glasgow city region expected to increase by 3.7 per cent to 2032, and Glasgow’s three largest institutions all targeting significant growth in their latest published strategic plans.”

A planning application has been submitted for a £30 million redevelopment of an existing 'underused' office building at 249 West George Street in Glasgow into new student flats.

Mosaic director Neil Haining added: “The design of this new development has been carefully considered in response to the site’s immediate context. We believe that this PBSA will help re-populate the city centre and provide a new use on an under-used site.”

Meanwhile, plans are being taken forward for a major £30m student accommodation scheme in the heart of Dundee. The site, which fronts onto the busy artery of Marketgait, has planning consent for a seven-storey, 189-studio bed block that will feature amenities including a ground floor “student hub”, gym, cinema room, dining room and a landscaped external courtyard.

IP Investment Management (IPIM), with Maven Capital Partners acting as asset manager, purchased the site in the summer and will be demolishing a former petrol station and redeveloping the space into the planned PBSA scheme. Construction is planned to start in 2024 and is anticipated to complete by 2026.

According to Savills research, Dundee is one of the most under supplied markets in Scotland with only around 3,900 existing student beds relative to a student population of more than 17,000.

Paul Johnston, a partner at Maven, said: “Despite the macroeconomic environment, which is presenting some challenges to certain property sub sectors, UK PBSA continues to remain resilient, particularly where there are significant supply shortages such as that in Dundee. Coupled with rising student numbers and a falling provision of HMOs [houses in multiple occupation] from private landlords due to increased regulation and tax changes, stock is being stretched and there remains attractive investment opportunities for quality projects.”

Selina Williams, executive director at IPIM, added: “Higher interest rates and inflation continue to curb future UK PBSA development pipeline on the back of higher demand, exacerbating the bed shortfall. We believe that investing now, ahead of the rebound, will be very lucrative for our fund once capital market conditions improve.”

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