The exact dates for an academic year are fixed by each institution, normally 2 years in advance (this is, of course, different from the calendar year).  42 weeks is standard, with 51 weeks for post grad accommodation, generally running from September to the following summer.  Your accommodation needs to be ready in time for the beginning of the academic year.  If not, you'll need to be thinking about LADs and alternative accommodation.

Affordable student accommodation is defined as bedrooms let at rates that, for the academic year, are equal to or below 55 per cent of the maximum income that a new full-time student studying in London and living away from home could receive from the Government’s maintenance loan for living costs for that academic year (London Plan, 2021).

Does the accommodation have a gym, communal living space, study space, games room, swimming pool, somewhere to watch movies?  The amenities offered impact on rents, operational logistics and costs, marketability, viewings and demand.

If construction is delayed and the accommodation isn't going to be ready for students to occupy at the beginning of the academic year, or for a provider, a room is unexpectedly unavailable, the parties will need to think about providing alternative accommodation. The students will need somewhere to live while the accommodation is not available.  LADs may also be triggered.

Accreditation Network UK – an organisation which publishes codes of management practice.  Although membership is said to be voluntary, most of those in the student accommodation sector join.  This provides common ground and good faith in the sector.  

Membership and a commitment to abide by the codes of practice also means that educational and non-educational establishments will be considered exempt from HMO licensing. 

The system the students use to book their accommodation needs to be user friendly.  These days booking systems are predominantly online. GDPR will also be important.

The Building Safety Act 2022 impacts on the design, building, occupation and any refurbishment of higher risk buildings in England) (those at least 18m or with at least 7 storeys with at least 2 residential units).  A number of student schemes have been impacted by this new legislation and the timings of any building safety work will need to be built into the programme.

Those who get university places after receiving their A level results will need to organise accommodation quickly before the start of the academic year.  The run up to results and applications through Clearing are a key time in the marketing cycle.

Full-time students generally don't pay Council Tax – but there are specific rules about eligibility and discounts.  When the building is empty such as during vacation periods, Council Tax will be payable so needs to be in the operational budget.

The design build finance operator model is a popular one in the student accommodation market.

The risk profile for student accommodation is different from other living sector assets because of the need for it to be ready for the beginning of the academic year.  If a development is delayed a developer could be liable for the costs of providing alternative accommodation and LADs.

Occupancy is key to a successful student accommodation investment. If the accommodation is consistently full income will be hit.  Demand risk will be key for funders who may ask to see a demand profile for the locality and may require a restrictive covenant. See also the benefit of Nominations Agreements.

Delay and Start Up Insurance is cover which insures the continued costs of funding when the ability to occupy a property is delayed. There is generally an excess period of between 45 and 90 days.  It is a commercial decision on which party in a transaction takes this risk.

This isn't just about international and UK based students, and the impact on overall numbers because of global events and immigration policy.  Students might choose to live at home whilst studying, so won't need accommodation in their university town or city. This needs to be factored in when looking at viability, demand and student to bed ratio.

This is where a provider markets and lets the PBSA to students directly (there is no Nomination Agreement with a university in place).

Access to higher education in the UK can significantly enhance career prospects and earning potential. It also broadens individuals' horizons through exposure to diverse ideas and cultures. A choice of good quality accommodation for students to live in whilst away from home is important in encouraging young adults to continue their education.

Consider whether any of the parties will need early access to the development.

Works done before financial close or before the programme begins to decrease the Delay Risk.

Facilities Management – arrangements put in place between the owner of the accommodation and the provider who will manage the properties.  "Hard FM" deals with the bricks and mortar, whilst "Soft FM" deals with services.

General Data Protection Regulations.  Landlords, agents and universities need to deal with students' data in accordance with the GDPR.  This includes rules around the way data is held, used and shared.  This will be important for booking systems.

House in Multiple Occupation.  A property might be subject to a licensing regime if it let to more than 2 students who don't form a single household – a typical student house share.  Depending on the type of property and its location, it may fall within a licensing scheme. There are exemptions from HMO licensing requirements where providers are members of ANUK. This organisation requires members to sign up to good management practices for student accommodation.

Hard nomination agreements provide a guarantee for all payments (possibly including rent, Council Tax, other outgoings etc) whether or not the room is occupied.

There isn't one clear over-arching definition of HEI but it is used to mean an institution providing higher education courses, and would include universities.

Investment Rate of Return.

Providers of student accommodation need to comply with the requirements of the Equality Act 2010 and so must have the flexibility to be able to deal easily with any request.

Student projects need a wide range of insurance so consider talking to an experienced broker to confirm what you need – building, contents (often included in residence agreements), operational etc.

We've been seeing an increase in this kind of structuring and a move slightly away from bond finance, possibly because of market conditions.

Most universities exercise some public functions and certain of their decisions are potentially subject to Judicial Review, meaning those decisions need to be made in a way which avoids illegally, irrationality and procedural impropriety. Failure to do so can result in a claim for Judicial Review as a remedy of last resort.

In the context of planning, this period relates to the six week 'window' within which the grant of planning permission can be challenged legally on grounds of illegally, irrationality or procedural impropriety. Such proceedings may result in the grant of planning permission being quashed.

The make-up of the project company usually a provider and developer.  We are seeing less uptake from universities interested in taking a stake in a joint venture.

Universities IT network - Joint Academic Network (JANET) is an internal, high-speed computer network that links the UK education and research community.

Key Performance Indicators  - a way of evaluating whether or not the standards a university is expecting are being met.  There will be KPIs in SLAs.

From procurement to planning to construction, from buying to managing, operating, from funding (debt and equity) and refinancing, all the way to exiting – we understand the full lifecycle of a student transaction.

Liquidated and Ascertained Damages.  Damages are payable for delay and for student schemes, they often consist of financing costs, and alternative accommodation costs (which include not only the cost of procuring alternative accommodation but also can include compensation to students who are placed in alterative accommodation, for example meal allowances and transport contributions).

It is crucial that emergency maintenance is done quickly and efficiently, whilst it will be more effective to do routine and cyclical maintenance during the university holidays. SLAs may provide remedies for default where maintenance is not done appropriately.

Ties into the academic year (and leading up to exam results and clearing).  The best form of marketing is word of mouth so a good student experience is crucial – see X Factor and YOLO.

Minimum Energy Efficiency Standard. This prohibits landlords of both domestic and non-domestic property from granting leases or continuing to let "sub-standard" buildings and building units, being those with valid EPCs which have an energy performance rating of F or G, unless the landlord makes sufficient energy efficiency improvements to the property (so that it is no longer sub-standard) or can rely on one of the legitimate reasons set out in law not to do so. It only applies to properties that are required to have an EPC. Whether MEES applies to student accommodation will depend on the nature of the tenancy.

The UK has a 2050 net zero carbon target. Given that the student customer base is predominantly young, there is an awareness and expectation for buildings to be "green".  This is reflected in the new designs for new student accommodation including and increasingly moving towards passive buildings.

An agreement between the university and the student accommodation provider in which the university commits to provide (or "nominate") a certain number of students to specific accommodation every year (for an academic year).  The agreement will also deal with services, costs, rent setting, service levels required etc.  See hard nominations and soft nominations.

If the accommodation is not going to be ready for the start of the academic year then the provider or the contractor will have to notify the HEI.

Off campus accommodation is more popular in major cities (like London).

On campus accommodation is always in partnership with the university or HEI.

Purpose Built Student Accommodation – new student halls of residence.

Those studying for post-graduate degrees may have different accommodation requirements from under grads, for example they may need to stay in their accommodation for almost the whole year (generally 51 week stays), rather than the standard 42 weeks.

Most universities have to comply with procurement law in awarding contracts for services, works and supplies, including advertising obligations and rules around the conduct of a fair process. There is potential liability (and cost and delay) and reputational risk if the rules are not complied with. Leaving adequate time to conduct the required process and careful planning are key.

The timings of the construction works are crucial as accommodation needs to be ready for the beginning of the academic year.

The person carrying out the services day to day at the Property and interacting with students.  The requirements will be set out in Facilities Management agreements and SLAs.

High quality accommodation produces high demand and good returns.  It will be important to keep the accommodation well maintained using SLAs to set standards.

The Bill has been published and includes the abolition of section 21 (no fault) eviction and assured shorthold tenancies.   PBSA remains excluded from the assured tenancy regime and the rules about HMOs are not changing.  The Bill amends the grounds for possession in the Housing Act 1988. Ground 4 is amended to allow specified educational establishments recover possession if the property was let to students in the 12 months before the start of the tenancy.  The Government says that this ground will allow possession of short lets during student holidays.  A new Ground 4A will allow HMO landlords who always let to full-time students to recover possession. The Government says that "this new ground will allow the annual cycle of student letting to continue."

The income stream.  Several factors go into rent setting, with any planning requirements being the first consideration. Then there are the specific rent review procedures often set out in nomination agreements or project arrangements.

Funders may require restrictive covenants from a developer that it will not transact on any other student accommodation projects within a specific radius to protect the demand for a scheme.

42 weeks is standard for under graduates and 51 weeks for post graduates.

Compulsory checks may be required to make sure that a student can legally rent the property.  Failure to complete the checks which leads to renting to someone without the right to be in the UK could lead to a fine or, in some circumstances, to a prison sentence. But there are exemptions for halls of residence or HEI provided accommodation, as well as accommodation which is provided under a nomination agreement.

Service Level Agreements are negotiated between the parties to set the scope of services and the standards required (using KPIs to check that those standards are being achieved).

Once your accommodation is built and occupied with a regular rent stream, you have a stabilised asset.

The number of beds available per student in an area helps to calculate demand.  Is there a need for more student accommodation?

Unlike a hard nomination agreement, soft nominations do give a university the ability to nominate if they have the students, but no obligation to.  Soft nominations do not include a guarantee covering rent.

Beware, there are a number of tax considerations.  Our advice is always to consider the tax implications of any structure and scheme.

There is no specific Use Class for student accommodation. Generally, purpose built student accommodation is taken as being in a class of its own, or Sui Generis, meaning that any change of use to or from student accommodation requires planning permission.

UK universities will fulfil the criteria of HEI, but not all universities have the same requirements or demand for student accommodation – so location will be key to viability. 

The changes in the immigration rules for visas for post grad families (which have been widely covered in the press and suggest a decrease in the number of post graduates coming to study in the UK) will have an effect on demand.

Letting out rooms over the summer brings in extra income but who has the right to the rooms and who keeps the money?

Having no income from a room is a risk.  A student may not sign up to a tenancy for a room or they may not be willing to go into the alternative accommodation that is offered to them if the room is not ready at the start of the academic year.  What happens then? Who pays for the empty room?

Pastoral care is a priority for students.  It will be part of the commercial agreement to have some safeguarding and pastoral care and support in the building.  The number of resident wardens may be calculated on a ratio depending on the number of students.  The cost of the warden accommodation will also be negotiated.

Student landlords and agents in Wales will need to have a Rent Smart Wales licence. A licence is valid for 5 years.  This is as well as complying with any licensing requirements for HMOs.

Student experience is crucial.  Different students may want different things, but they all want their accommodation to have the X Factor.  And that helps with demand and your marketing cycle.

This is your return on investment.

You know the saying "You only live once" and that is true about life as a student so it is all about delivering a great student experience, providing the right amenities at the right price in the right place.  And then the students will do your marketing for you by word of mouth.  See X Factor and Marketing Cycle.

A different, more European approach to planning, where the general parameters of development and uses for an area are set by policy, and significantly less emphasis is placed on individual landowner or developer applications for planning permission. There is debate as to whether the planning system in England and Wales is heading in this direction.

Remember to take tax advice. Make sure that that the construction of your student accommodation can be zero rated for VAT purposes where possible.  Irrecoverable VAT will be an additional cost to the development.