Unite Group reiterates rental guidance after solid Q1

The company reiterated its guidance to deliver rental growth of "at least 6%" for the 2024/25 academic year, down from 7.4% last year.

Demand is said to be "strong", with the percentage of beds sold for the upcoming year rising to at 86% by 31 March, up from 80% at the time of its full-year results in February, though down from 90% the same time the year before.

By the end of March, the Unite UK Student Accommodation Fund (USAF) was valued at £2.98bn, a 0.5% reduction on a like-for-like basis, as rental growth of 1.7% was offset by a 2.0% negative impact from the loss of Multiple Dwelling Relief (MDR) – the tax relief that was abolished as part of the Spring Budget which had benefitted a number of Unite's properties.

Meanwhile, the London Student Accommodation Joint Venture (LSAV) valuation increase 0.8% to £1.94bn, as 1.3% rental growth offset the 0.3% negative impact of losing MDR.

"Student demand is strong for the 2024/25 sales cycle, reflecting the continued appeal of our fixed-priced, all-inclusive offer and a growing shortage of high-quality student homes," said chief executive Joe Lister.

"Together with our alignment to the UK's strongest universities, this supports a positive outlook for rental growth for the 2024/25 academic year and underpins our property valuations."