Already back in 2012, Savills released a report pointing out opportunities for investors in the Italian student housing market. A low number of beds and private operators made room for these opportunities. On a population of 1,7 million students there were only 50,000 beds in dedicated student accommodation, which corresponds to a provision rate of only circa 3%. And of these 50,000 beds, only 3% was offered by private PBSA providers.
Since then, Italy suffered fom a severe debt crisis, which caused an economic downfall and some years of economic stagnation. During these years new student housing developments have been initiated by various regional foundations (like Fondazione CEUR and Fondazione RUI) and collegi universitari (Collegio di Milano etc). A fundamental to the Italian student accommodation market is the strong prevalence for students to live at home during study and the observation that domestic mobile students, moving from south to north for studies, typically find themselves in shared apartments scattered around the city.
While Italy is still behind its European peers – not only when it comes to PBSA provision, but also when it comes to the number of English Taught Programmes (ETPs) and university rankings – there has been an increasing interest of international investors, developers and student housing providers in the last two years.
 Spotlight: Student Housing in Italy, Savills, 2012
Camplus for example continues to grow at a rapid pace in Turin, where it will soon be reaching 2,000 beds. They also manage the Mario Luzzatto Student House (240 units) that opened on the campus of the Humanitas University in Pieve Emanuele (near Milan). In addition, they will manage 650 units at the Santa Marta campus in Venice that will be completed in 2019, and open in Rome (178 units; delivery expected for 2020) and on two locations in Bologna (95 units; expected to open in 2021).
Bologna is in the spotlight for other Italian investors and developers. Recently rtmliving opened a new location in Bologna along with the investor Stone Hill that planned a student complex with 300 units in Bologna. Delivery of the project is expected for 2020. DoveVivo is also active in this market, as well as Milan, Rome, Turin and Como. The company just acquired H4U srl, a residential building management company with a portfolio of around 70 apartments in Milan and Rome, pushing their total portfolio to approximately 850 assets with a total of 3,500 units. In Domus will open a location with 104 units at Viale dell’Innovazione in Milan in 2020. Besides this, CampusX will open in Milan, but first they are planning to open a location with 246 beds in Florence in 2019 as well setting a plan in motion to open in Turin.
Various universities are similarly expanding their supply of student housing. The University of Camerino opened a complex of 456 units, and the Opera Universitaria di Trento opened a complex of 130 units. Politecnico di Milano announced to open an accommodation of 350 student units, and the University of Lucca plans to open a complex of 100 units in 2020.
Among international investors it is mainly The Student Hotel that has caught attention as a first-mover into the market. Recently TSH opened the doors of their first location in Florence (390 rooms), and has two more projects planned in the same city. Besides this, there are openings confirmed in Bologna and Rome. The Student Hotel group plans to have more than 10 Italian properties open, in development or secured by 2023, accounting for hundreds of millions in investments. Alongside with this, investor Avenue Partners is planning to open a student complex of 357 units in Turin in 2020.
Hines has been keeping an eye on Italy and specifically on Milan. A noteworthy development is the new Bocconi campus, in the southern part of the city, where Hines announced an investment of €160m for two new student residences, with a total of 1,300 rooms that will be delivered in 2020/21. The company also revealed to invest €340m in other housing schemes in Rome, Florence, and Venice.
Even though Italian politics have gotten used to some volatility, the recent elections held in March 2018 empowered a Eurosceptic coalition that caused significant uncertainty. This reflects for example in non-residential real estate investments, which dropped 40% compared to last year. According to analysts this is partly caused by the instability concerns that international investors have regarding the new government. However, this trend seems not to be affecting alternative products such as student housing. These assets are facing an increasing attention from investors that want to further diversify their portfolios, and the foreseen promise of higher yields.
EDUCATION & MOBILITY
Half of the 1.7 million Italian students move away from their home towns for their tertiary education. In addition to this, Italy welcomes circa 95,000 international students per year. This amount is comparable to the number of international students that come to The Netherlands every year, while its population is much smaller (60m vs 17m). This trend is caused by a mix of a low amount of English Taught Programmes and the relatively low international rankings of the Italian universities.
According to the 2019 QS World Ranking the three best Italian universities are Politecnico di Milano (156), Scuola Superiore Sant’Anna (167) and Scuola Normale Superiore di Pisa (175). A more competitive advantage is to be found in the private schools in Italy that excel in their niche and have a strong international perspective as SDA Bocconi in Milan, Polimoda in Florence and Istituto Marangoni in Milan. A further increase of English Taught Programmes in both Bachelor and Master programmes might give birth to a new renaissance in Italian higher education.