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Student accommodation investment in Bradford: A property investor’s guide

Bradford student accommodation property investment guide
May 26, 2016

This guide discusses all aspects relevant to student property investing in Bradford. In it, you will discover the economic drivers behind Bradford’s projected growth, the growing reputation of its university and find out why purpose built student accommodation is an ideal alternative investment to buy to let.

It analyses the key factors that continue to make this vibrant city a sought after student destination, as well as introducing the University of Bradford – one of the highest climbers in this year’s league tables. Read our guide to find out the ins-and-outs of investment property in Bradford.

 

Contents

Click on the above link to jump to the category or scroll down to look through the property investment guide:

 

An overview of Bradford

Globally respected management courses

Bradford was first established nearly 1,000 years ago and its textile industry catalysed enormous growth during the industrial revolution. The city is today a vibrant, multicultural city that is attracting extensive investment.

The city’s location in the heart of the UK means that it benefits from excellent national and international connectivity. It is six miles from the Leeds-Bradford International Airport – one of the UK’s fastest growing airports, providing three daily flights to London. It also has strong motorway infrastructure and Manchester is only one hour away by train.

Bradford is developing into one of the UK’s cultural hotspots, with an extensive range of exhibitions and year-round events across the district. It is the world’s first UNESCO City of Film and its National Media Museum is the most visited museums outside London. The Saltaire Model Village is one of only two World Heritage sites in Yorkshire, while the Lonely Planet recognises the Yorkshire Dales National Park as one of the top tourist destinations in the world.

The city was recognised as a top 40 UK retail destination even before the flagship £260 million “The Broadway” Shopping Centre opened in November 2015, attracting 10 million visitors each year (CACI Retail Footprint data). It joins the Kirkgate Centre and Foster Square Retail Park, as well as a thriving independent scene, and the council estimates that The Broadway will catalyse over £500 million of investment into the city centre.

 

A fast-growing economy

Largest UK retail centre to open in 2015

A vibrant city with ambitious development plans, Bradford’s economy is valued at over £8.3 billion – the 3rd largest economy in Yorkshire, after Leeds and Sheffield. It is home to 15,200 businesses, with a combined workforce of 192,200 people. Economic growth since 2008 has outpaced the regional and national averages and it is projected to increase to £9.6 billion by the end of 2016.

The city’s financial and business services sector generates over £13 billion a year and it is estimated that this will increase by a further 50% by 2022. Bradford’s £1.5 billion regeneration Masterplan, alongside the government-backed £35 million City Centre Growth Zone, is increasing its attraction as an investment location.

A £21.96 million contract between local West Yorkshire authorities and BT, completed in 2015, has further improved connectivity.

Bradford is home to over 40 large companies that together employ 370,000 people across the country. These include:

  • Freeman Grattan Holdings: UK arm of the Otto Group (the world’s largest distance-selling organisation)
  • Hallmark Cards: Largest greetings card company in the world
  • Morrison’s: Fourth largest supermarket chain in the UK
  • Pace: The world’s largest developer of set-top boxes
  • Provident Financial: 60% market share of home credit provision
  • Santander: One of the UK’s leading personal financial services companies and mortgage providers
  • Yorkshire Building Society: Second largest UK building society
  • Yorkshire Water: The largest landowner in Yorkshire

Development initiatives

Award winning city centre meeting place

Bradford’s city centre is experiencing an extensive makeover, with £525 million invested in public spaces in 2014 alone, as well as improved interconnectivity and restored historic architecture. Highlights of this include:

  • The £260m Broadway Shopping Centre, projected to attract 9 million more people to Bradford each year
  • City Park – a new £24.5m city centre public meeting space and concert venue. Since opening 3 years ago, the council estimates that it has attracted 500,000+ people and generated £7million+ of additional spending
  • £18m conversion of Bradford Odeon building into a 3,500-seater live music venue
  • A £780,000 redevelopment of the National Media Museum is close to completion and will be boosted by a further £1.5 million, which will be used to create an interactive science gallery

 

The University of Bradford

One of the UK's fastest climbing universities

The University of Bradford was formed as The Mechanics Institute in 1832 in response to the city’s need for workers with cutting-edge skills. It was awarded university status 50 years ago and has a strong and growing reputation for academic excellence that includes:

  • Top 100 Global Business School (Executive MBA Ranking 2015)
  • Fastest Growing Reputation of Any UK University – climbed 30 places in three years (Complete University Guide)
  • One of only 58 global business schools in the world to hold the Triple Crown of industry accreditations (AACSB, EQUIS, AMBA)
  • Top 10 MBA programme in Europe Top 20 University for Employability (Sunday Times University Guide 2013)
  • Top 25 University for International Students in six subject areas
  • Top 50 University for Research Quality

New university investment

One of the UK's greenest universities

The University of Bradford has invested £120 million on upgrading its buildings and teaching technology over the last decade. This is set to continue, with the university recently announcing a further £30 million investment programme. This will underpin proposals for a 30% increase in student numbers by 2024. Recent highlights include:

  • £1.5 Million Science, Technology, Engineering and Maths (STEM) Centre
  • £6m School of Management Bright Building (Education and Sustainable Development Centre)
  • Award-Winning £40 million The Green Student Village
  • £4.3 Million Refurbishment of University’s Faculty of Life Sciences
  • £8 Million Student Central building

Theses buildings have some of the highest sustainability ratings for their type in the world and Bradford is recognised as the eighth most environmentally friendly university in the world. It is also one of only 10 UK universities with a prestigious green flag award, normally reserved for parks and public green spaces.

The Learning Quarter & Bradford College

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Bradford University’s City Campus is located in the Learning Quarter. This is home to both Bradford University and Bradford College, and was developed in partnership with the Bradford Metropolitan District Council and private investors.

Designed to provide a centre of excellence through design, education and innovation, this £750 million development underpins the future development plans of these two institutions.

Bradford College is the fourth largest college in the country and the country’s largest provider of Higher Education outside of the university sector. It has a population of approximately 25,000 students, of which around 10,000 require accommodation locally. The college’s nomination agreement for just 120 rooms in nearby private student halls means that the vast majority of these students are left without purpose built accommodation.

Student life in Bradford

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Bradford is a diverse community of nearly 14,000 students from 130+ countries. The university has a larger percentage of overseas students (17%) than the UK average thanks to an extensive network of international offices and working partnerships with 15 global institutions. Students are attracted by the high employability level of graduates and the low cost of living.

The hub of student life is the university’s three-storey student central building. This contains various bars and cafes, as well as a 1,300 capacity nightclub. It also houses the university’s students’ union, library and impressive modern atrium.

It’s attractiveness as a student destination continues to grow as a result of the high levels of investment taking place across the city and within its academic institutions, as well as the growing reputation of its university.

Knight Frank estimates that an average of 26% of students have access to Purpose Built Student Accommodation across the UK. At 17.6%, Bradford is sitting well below this and it would continue to do so even with a 50% increase in the number of designated rooms available. This means that Bradford has one of the highest demand levels of purpose built student accommodation in the country, something that will ensure sustained demand for rooms.

 

The case for investing in student property

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Purpose Built Student Accommodation (PBSA) offers lucrative investment returns. While many assets in alternative industry sectors are under performing, PBSA has grown into the top-performing asset in the UK since 2011 (Knight Frank). It has also this year overtaken the US student property market for the first time.

Globally, investment in student housing has risen from $3.4 billion to $7.2 billion between 2007 and 2013. Although it is mostly institutional investors that have led worldwide investment (accounting for more than 57% in terms of overall sales volume), the private sector is claiming an ever-larger share of the market.

On the world stage, the higher education sector is currently being valued at approximately $164 billion, and predictions are that this figure will reach $200 billion within the next 10 years.

 

Ever-growing student population

The country’s total student population now sits at around 2.3 million, including 430,000 international students – the largest overseas student population of any country outside of the US.

They are attracted by the global reputation of the UK’s English-speaking academic system. Their number has doubled over the last decade and Knight Franks predicts growth of up to 20% over the next five years.EP_NewsImage_graph_Student-numbers

Reliable high yields

Student investment property in Bradford provides investors with reliable earning potential. Even though the rental contracts are relatively short, these properties are always in high demand and are currently still critically undersupplied. With student numbers expected to continue growing and a limited number of new developments in the pipeline, PBSAs are expected to remain a lucrative investment option for the foreseeable future.

 

Introducing Scholar’s Village

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Scholar’s Village is our newly released fully operational student property in Bradford. It has proven popular since 2006, with students drawn to the large purpose built en-suites, excellent range of facilities and professional onsite management – enabling hassle-free living.

Our property is just 120 metres from the main university campus. This prime location within the city’s Learning Quarter means that it can capitalise on demand from both the university and Bradford College – the UK’s largest higher education institution outside of the university sector. Discover more about our property here.

 

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