Unite Students cancels London project and defers Bristol scheme over viability issues

Unite Students finally obtained planning permission for the Paddington scheme last month, after London mayor Sadiq Khan stepped in to approve the project. The scheme had been redesigned following two previous refusals.

Jules Pipe, London deputy mayor for planning, concluded that the scheme’s benefits to local housing demand and economic growth outweighed Westminster Council’s objections.

Representatives from the council argued that the scheme’s twin towers would lead to an unacceptable loss of light to housing blocks in the area and would cause harm to nearby conservation areas.

Unite Students said that, for new schemes to be viable, they now require minimum rents of around £230 per week, while Building Safety Act gateways have been delaying delivery programmes by between six and 12 months.

It cited data from CBRE and Cushman & Wakefield showing that new net supply growth has been falling sharply, with PBSA completions in 2026 amounting to a low single-digit percentage of existing stock, and further easing expected in 2027.

Elsewhere in its stock market announcement, Unite Students revealed that 64% of its rooms for the 2026-27 academic year have now been reserved, compared with 67% at the same point last year.

This includes 56% of beds let to universities under nomination agreements, compared with 59% last year, and 8% through direct-let sales, unchanged from 2025-26.

The landlord suggested it had lowered prices in markets with lower occupancy in 2025-26, including Nottingham, Sheffield and Leicester, resulting in reservations slightly ahead of last year in those cities.

The company said sales progress to date is consistent with its target of 93-96% occupancy and 2-3% rental growth for the 2026-27 academic year, compared with 95.2% occupancy and 4% rental growth last year.

A further update is expected at the end of next month.

Unite is the UK’s largest owner, manager and developer of PBSA, with 143 properties across 22 towns and cities.

Joe Lister, chief executive officer at Unite Students, said: “We will continue to invest where we see the strongest risk-adjusted returns and expect to generate further surplus capital over the year ahead as we make progress with planned disposals.

“We are focused on delivering on our strategic priorities, namely driving operational excellence and optimising capital allocation.

“These underpin our medium-term outlook and our path to return to earnings growth from 2027.”

In December, Unite completed funding for a joint venture with Newcastle University to build 2,009 student beds. The development, comprising buildings of four to nine storeys, replaces Newcastle University’s former 1,250-bed accommodation, which was built in the 1960s and demolished last year.

Also last year, Unite reported a 51% fall in rental growth driven by a decline in beds sold. It experienced a 2.4% drop in the number of beds sold, with 95.2% of beds sold compared to 97.5% the previous year.

The board of Unite also agreed to take over rival student landlord Empiric Student Property. The deal will create a combined portfolio worth approximately £10.5bn, comprising around 75,000 student beds, with 92% located in cities home to Russell Group universities.