How can investors unlock value in PBSA?

The UK student housing sector is entering a new phase, unlocked not through new builds, but the value of refurbishing existing stock. With planning constraints and construction costs still slowing new developments, and 65% of existing stock having been built before 2012, refurbishment is emerging as a high-impact, high-return opportunity for value-add investors to meet the surging demand for modernised, centrally located purpose-built student accommodation (PBSA).

While new developments remain essential to filling the shortfall in student beds, they face mounting headwinds. Planning delays and Building Safety Act Gateways are elongating timelines. Cost pressures, from materials and labour to land pricing, are also making funding new build PBSA increasingly complex. However, with two thirds of prospective students factoring the availability of student accommodation into their university decision, the need for institutions to offer a modernised supply is imperative.

In contrast, refurbishment offers a faster, more flexible route to market. It enables developers to navigate regulatory hurdles more swiftly while delivering upgraded stock that meets modern student expectations in centralised locations, closer to campuses and city centres.

For investors, the potential of refurbishment is not limited to the increased rental income offered once the project is complete, but also that of established rental histories, which, depending on phasing for the refurbishment, can continue to be charged in liveable spaces whilst other areas of the building are being upgraded.

University enrolment has expanded considerably since the majority of existing PBSA stock was built in 2012, however the increase in student beds during this time has not reflected this growth, bringing about a shortfall which has further heightened demand for modern assets. This has created a two-tier system of older developments, which are centrally located but struggle to command higher rents, and newer developments, which feature communal spaces and amenities which are highly sought after by students.

We have seen our own clients unlock value in this way; for example, we advised GCP Student Living PLC on the acquisition and transformation of Woburn Place in London, where their refurbishment unlocked value in a prime central London asset. Following vacant possession and having held the asset for a short period to benefit from the income until the end of the academic year, GCP undertook a comprehensive redevelopment and refurbishment programme, rebranding the property as Scape Bloomsbury. Following GCP having been taken private, Scape have owned and continued to successfully operate the property.

Refurbishment isn’t just an alternative; it’s the next big opportunity. With £1.6bn invested in UK PBSA in the first half of 2025, investor appetite remains strong. Yet Grade A stock in Russell Group cities in particular remains scarce, creating a gap that refurbishment is perfectly positioned to fill.

In a sector where there remains a demand: supply imbalance and investment flows remain strong; refurbishment offers a faster route to resilient rental performance and standout assets in competitive markets. For developers and investors, the message is simple: the next wave of success in student housing won’t come from breaking ground, but from breathing new life into what’s already there.