Back in session: Student accommodation market revived

Last month, Singapore-based development group Centurion Accommodation acquired a new 732-bed EPIISOD facility in Sydney’s Macquarie Park for $345 million. It’s the real estate investment trust’s first foray into student accommodation in the harbour city. 

At $471,000 per bed, this deal sets a new benchmark in values for the student accommodation market and blows Sydney’s typical range of $325,000 to $388,000 per bed out of the water.

And in Adelaide, a prime corner site at 2747 square metres has been sold for $26.29 million to student accommodation developer Journal Student Living this month. In a partnership with Brookfield Management and Citiplan Property, the company plans to build a $400 million student housing project.

It will be located on North Terrace in Adelaide’s CBD – the same street as a proposed 33-storey student accommodation tower by developer Trinity City.

Increasing international student numbers were attracting off-shore investors to Australia’s student accommodation market, said Vanessa Rader, head of research at Ray White Group.

“The appeal is obvious,” Rader said. “International student enrolments have reached record levels, exceeding 1.09 million students in 2024, representing a 15 per cent increase from pre-pandemic levels. The latest data through October 2025 shows total international student numbers sitting at just over 1 million across all education sectors. 

“This strong demand is occurring during broader housing market pressures and creates a compelling investment case for groups experienced in operating student accommodation assets in other mature markets.”

Rader’s research shows Australia’s current level of student accommodation is not meeting demand. The privately owned and managed sector offers approximately 90,000 beds, while on-campus and college accommodation accounts for about 134,000 beds.

“When you consider there are more than 1.6 million students enrolled in Australian universities annually, the supply-demand imbalance becomes obvious,” she said.

“It’s this fundamental undersupply that continues to attract capital from North American, European and Asian institutional funds looking to leverage their operational expertise in a market that remains relatively underdeveloped compared to the United Kingdom or United States.”

The latest Urbis Student Accommodation Benchmarks reveal that 40,000 beds are now in development across the country. Rader said this is an increase from 36,000 beds recorded in early 2025.

The increase in student accommodation is being propelled by the Australian Government’s policy to ease housing pressures by linking university international student visa allocations to demonstrated investments in student accommodation.

Australia’s abundance of outdated office buildings has presented opportunities for developers pursuing adaptive reuse projects. Dexus, the largest private owner of on-campus student accommodation in Australia, has converted a 27-storey former government building in Brisbane into an 1180-bed student accommodation facility.  

It is believed to be the first office to purpose-built student accommodation transformation in Australia.

Dexus project director James Curtin said 41 George Street, which will open in June this year, was a government office for 43 years and now has the latest in housing and amenities for students. 

“These guys will have access to theatres, to music rooms, to a commercial grade laundromat and commercial cooking spaces and each room has its own cooktop,” Curtin said.

“There is a gym area with an enclosed balcony. So holistic wellness and running those programs for students is also very important in the current design of PBSA (purpose-built student accommodation).”

Curtin said the company is eyeing another two office buildings for conversion to student accommodation as the market continues to surge.

“International students want to know they’re coming over to a guaranteed place and a guaranteed bed, and to not have to think about buying furniture and buying the bed and the chair and the study desk et cetera, knowing that it’s all available to them and locking down their place to be able to accept and their university place is very important,” he said. 

“Even domestic students are now starting to realise that at least for the first 12 months of their university education, that maybe being in one of these facilities where it’s term care and they can settle into uni before they get tied into leases and having to buy furniture and establish themselves is definitely a growing market.”