Central Eastern Europe Regional Session

April 9, 1pm

Warsaw

JLL
Warsaw Spire
Plac Europejski 1
00-844 Warszawa

The rise of university cities in Central Eastern Europe

It is exciting to witness the purpose build student accommodation sector showing high growth potential in Central and Eastern Europe, where demand is generated largely by growing numbers of international students. Poland, for example, has twice as many higher education institutions as the UK, but remains among the least internationalized in Europe. New government strategy and financial commitment to internationalization is about to change the outlook on higher education. Recent reform of higher education management will further help consolidate the positioning of universities and campuses in Polish cities. In general, a wide range of university programmes, historic cultural heritage and affordable tuition and rents attract a growing international student community in Warsaw and Prague.This will have meaningful implications for the situation of student living.
While student demand is quite strong because of the current low cost of living, low provision of professional student accommodation calls for the introduction and expansion of much needed PBSA brands and products. Furthermore, cities and regions need a mechanism to attract and stabilize global talent in order to be competitive. Purpose build student accommodation provides this much-needed mechanism to improve recruitment of international talent into these emerging higher education sectors. It is high time to shift focus and explore the university cities of tomorrow in the East.

Outlook

Highlights

  1. With 250.000 students in the Warsaw region and only 18.000  beds available, there is an immediate need for investment in student accommodation. This includes radical refurbishment of the 14.000 beds which were built by public universities in the 1960s and therefore do not reflect contemporary student preferences anymore, as reflected in recent studies showing that less then 10% of students are satisfied with university dorms.
  2. A majority of domestic and international students rent in the private rental sector (60-70%). This is reflected in a quick rise of private investors with small portfolios of 2 to 10 apartments. The price point of these non-professional landlords is low, but so are quality standards.
  3. For the City of Warsaw professional student accommodation is paramount in the competition for talent – with other European talent hubs, but also cities in the CEE region. City Hall reckons its responsibility in providing better regulatory frameworks like zoning and cutting down bureaucracy.
  4. It is not easy to be a first mover in the CEE market. The legal lounge with Crido clearly outlined how blurry tax rulings are, but the panel also touched upon political rhetoric providing little comfort for the long run.
  5. Public-private partnerships with universities, like nomination agreements, are not CEE. The model is rather direct let and this makes operators focus extensively on good marketing.
  6. Alike other European university-cities also in CEE location is key. En-suite rooms with good shared amenities are more sought after than studios, often providing a better price point.
  7. There is a big urgency for education of the sector ecosystem. The PBSA sector is dependend on the right kind of capital, and that means that banks and the various kinds of investors need to become more aware of the product characteristics.

Trends Panel

The trends panel explored the rise of the university city and the implications for student living and student accommodation. How do higher education institutions attract international talent, why is this a priority for urban government, and can we expect a surge in international programmes? Which countries or cities will attract the most foreign students? And what does this mean for demand in the PBSA industry?

Speakers

Billy Kontoulis

Business Development Director Europe

ASK4

Zdena Noack

Co-Owner

Zeitraum

Tomasz Bojęć

Founder

think.co

Piotr Sawicki

Director of Economic Development Department

Urząd M. St. Warszawa

Jorick Beijer

Director

The Class of 2020

Moderator

Investment Panel

This panel discussion focussed on PBSA investments and operations in Central and Eastern Europe: major new projects and transactions, yields/ROIs, demand-supply imbalances, differences in investment interest by location, shifting student demands and product type.
Market presentation

Maximilian Mendel

Head of Living Investment

JLL

Speakers

Harald Hübl

Investment Director

Milestone

Gracjan Kleger

CEO

Gent Holding S.A.

Armon Bar-Tur

Chief Executive Officer

BaseCamp

Philip Hillman

International Director

JLL

Moderator

Sponsors

Silver sponsor
Legal lounge sponsor
Hosting sponsor
Special participant

Share your posts of the Session using #CEERegional2019 and #TCO2020

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