The supply of student residences in Portugal falls well short of the increasing demand for accommodation, according to a study by Cushman & Wakefield.
The study on the Purpose-Built Student Accommodation (PBSA) in Portugal shows that investment in this market has grown significantly over the last four years, accounting for 6% of total investments in Q1 2022.
At the same time, the percentage of foreign students has been growing steadily, with numbers doubling from 7% in 2011 to 15% in 2020.
The private sector accounts for one third of bed numbers in student accommodation, with around 6,700 beds, dominating in the main cities where it represents 60% of total supply.
Public and religious providers cover the demand in the remaining parts of Portugal.
Ana Gomes, head of development and living at Cushman & Wakefield Portugal, said: ‘The country has all the conditions to continue to see an increase in investment in student residences, since there is a substantial margin for growth in the area and a lack of supply in the face of the number of interested parties, considering the country's choice for study plans, such as ERASMUS. This leads to a growing interest from investors, which in the coming years should result in the emergence of new ventures that reinforce the number of beds available for university students. In fact, the number of new beds already planned to enter the market in the next three years is higher than the number of private beds already in operation.’
The student accommodation offer in Lisbon and Porto is well below the European average.
The low supply in Lisbon is main due to the difficulties in identifying good development opportunities at viable prices, as they compete directly with the increasingly expensive residential market.
Only five PBSA transactions were completed in the last four years, two of which this year - Catella's acquisition of the Milestone project in Carcavelos and the sale of the Smart Studios portfolio.
