In Kenya, Purpose Built Student Accommodation (PBSA) has emerged as a promising real estate asset class with substantial growth potential. Tailored specifically for students, PBSA prioritizes amenities such as separate study rooms, a gym, CCTV coverage, games room, biometric access, common areas, tuck shops, laundry services, and DSTV connectivity.
Key players in the Kenyan PBSA market include Acorn, Century Developments, Defoca, and Student Factory Africa.
According to a report by Cytonn the demand for student accommodation is robust, fueled by a significant annual increase in university enrolments. In the fiscal year 2022/2023 alone, university enrolments surged to 562,925 from the previous year’s 562,066. However, available beds fall short, with Acorn reporting only 280,000 beds against a university student population of 600,000 in 2021.
Investors strategically position PBSA projects near universities for enhanced accessibility, as seen in Qwetu Parklands catering to Law students at Nairobi University, Kenyatta University, and Mount Kenya University. PBSA stands out as a resilient investment, offering a hedge against economic downturns due to consistent year-on-year university student enrolment, minimizing voids and vacancies.
The sector’s growth potential is underscored by the escalating demand for student housing driven by population growth. As the student population continues to rise, more market players are expected to enter the PBSA segment.
Notable initiatives include collaborations between high-net-worth individuals, such as city architects, the Kenya Conference of Catholic Bishops, and Betonbouw B, a Dutch private equity firm, pooling resources to establish student accommodation projects. This positive momentum indicates a collective effort to address the accommodation deficit and capitalize on the expanding market.
