PBSA remains on students’ radar despite rental growth

Theres is a clear shortage of beds in halls of residence throughout Poland. Cushman & Wakefield estimates that only 9% of students can be accommodated in university-owned schemes. Conversely, although modern private facilities have doubled their offer in the last 10 years, they can accommodate only 1% of students in Poland,

comments Karolina Furmańska, Living Sector Expert, Cushman & Wakefield.

According to Cushman & Wakefield’s data, there are more than 11,500 beds in private halls of residence in Poland and another 6,000 in the pipeline. Private student accommodation in Poland is not as popular as, for example, in the US, the UK and Germany, but this market is growing at a rapid pace and attracting growing investor interest. In 2023, beds in the UK’s private halls of residence accounted for over 60% of all beds in student accommodation schemes. The number of beds is growing on average by nearly 4% annually, but there is still a shortage of around 370,000 beds. The PBSA sector is also growing at pace in other parts of Europe,

adds Karolina Furmańska.

With an average monthly rent of PLN 590, Łódź is the most budget-friendly city for students. Conversely, Wrocław is the most expensive city, where rents average PLN 810 per month. Poznań boasts the most extensive range of rents for a self-contained unit in a public hall of residence across Poland, varying from PLN 610 to PLN 1,650,

adds Tatiana Murwajowa, Junior Investment Consultant, Cushman & Wakefield.

Tenant activity and advert rotation levels remain very high and are even higher than they were before the war. Tenants who last year in a way had no choice due to a very limited number of offers and rising rental rates are now looking for better quality flats and attractive rents in particular. Of course, they cannot expect rents to start falling suddenly given the continual growth in service charges. They can, however, expect that an increase in supply, including more intense competition, will make landlords more willing to make concessions during rent negotiations. This, however, still means bargain hunting rather than a return of a tenant-friendly market as the lifetime of an advertisement on our website is not getting longer despite a marked increase in supply,

comments Ewa Tęczak, Real Estate Market Expert, Otodom.

Data from Cushman & Wakefield shows that rents for both private and public student accommodation have risen by 44-47% over the past three years. This year alone, rents for single and shared rooms have increased by 17% and 19% respectively. Rental rates, however, usually cover all utility and electricity charges which have gone up the most over the year,

comments Karolina Furmańska.

With the growing popularity of private PBSA, this market has become an attractive investment target for both private investors and large companies. We are seeing an increasing willingness of investment funds to allocate capital to this sector, with investment activity gaining momentum both in Poland and in other European countries. Publicly announced PBSA projects are expected to deliver more than 6,000 beds in the next two to four years. Another few thousand beds are likely to come onto the market in the next five years, but remain a business secret for now,

concludes Karolina Furmańska.