Unite, the specialist student accommodation provider, recently reported that 99% of its rooms had been reserved for the 2008-09 academic year, with a like-for-like rental growth of +11% over the last academic year.

While job losses and a consumer slowdown affect demand in the offices and retail sectors, there is no sign that student numbers are in decline. There are about 2.4 million students in the UK, an increase of +27% since 1999, and Unite forecasts that this will rise to three million by 2014. Student applications are up +9.4% for the 2008-09 academic year, according to UCAS.

Unite has 37,000 beds in 250 purpose-built blocks built off university campuses. The sites under management and in development are worth more than £2.9bn. However, the company has not been immune to the downturn in the property sector – reporting a fall in net asset value of -2.3% for the six months to 30 th June 2008 – but it has easily outperformed other areas of the property market.

There are other providers of student accommodation that operate different business models, including University Partnerships Programme (UPP), which works jointly with universities. UPP has a portfolio of more than 17,000 rooms and plans to invest a further £1bn in the next two years. Unite is the biggest, however, and wants to double the size of its UK business by 2012, although is now taking a more cautious view on the market.