In a new report international real estate advisor Savills finds that the number of foreign students in Italy has grown by 121% over the past decade with more than half of new international students arriving from non-Euro countries, including 20% from Asia.
In a new report international real estate advisor Savills finds that the number of foreign students in Italy has grown by 121% over the past decade with more than half of new international students arriving from non-Euro countries, including 20% from Asia.
While domestic student registrations have dropped slightly in recent years, approximately 58,000 of domestic students study outside of their home regions, requiring alternative accommodation. This, combined with the rise in overseas student numbers (to approximately 60,000, 3.3% of Italy’s total student population of 1.8 million), has opened a window of opportunity for investors in the emerging student housing sector.
The firm estimates that there are currently circa 50,000 student beds managed by the universities (7%), regional authorities (80%) and private colleges (10%). This supply reflects an average student housing provision rate of 3% and satisfies less than three-quarters of demand from intra-regional and foreign students.
Eri Mitsostergiou, Savills European Research Director, says: “The development and ownership of assets is mainly in the hands of universities and regional authorities but we do not expect any significant new supply to come from the public sector in the near future, creating an opportunity for national and international investors and developers.”
Savills report shows that prime yields stand at approximately 7% and expects them to remain stable. Marcus Roberts, Head of Savills Student Investment at Savills, comments: “Student housing is emerging as an attractive alternative property investment opportunity, although private investor involvement in the sector is still very limited. Therefore we expect yields to remain attractive compared to the other sectors in the market.”
In terms of occupiers, the firm’s data shows considerable variation depending on location and the type of premises, recording an average of €270 per bed per month but ranging from €60 to €1,100 per bed per month. Overall, 65% of Italy’s student halls are located across Lombardy, Emilia Romagna, Tuscany and Piedmont, where almost 40% of Italy’s students are concentrated.
View full Italian Student Housing research report (PDF, 1.22MB)