By Ben Morley, managing director of true student
In the midst of a brutal cost of living crisis, getting value for money has understandably become the number one priority for students searching for accommodation this September. Yet despite a huge shortfall in beds in the UK, students are becoming increasingly discerning in their property choices, often seeking rental agreements that are inclusive of utility bills and making their decisions based on which deals offer the highest levels of financial security.
Accommodation providers who absorb the volatility of energy-cost inflation and offer year-long all-inclusive packages to students have started to gain the upper hand – a trend which is undoubtedly working in favour of PBSA (Purpose Built Student Accommodation) and against the PRS (Private Rental Sector).
Spurred by the popularity of these contracts, PBSA is now widely considered a better value option for students. A Knight Frank comparison recently revealed that in 80 per cent of the 16 university towns and cities that it analysed, the average all-in cost of PBSA was now lower than the average for the wider rental market.
But winning the value-for-money-battle undoubtedly comes at a heavy cost.
Utilities are now often the largest operational overhead for PBSA providers, who are often reluctant to pass on uplifts to students in order to keep their offerings affordable and competitive – and this can leave them particularly exposed to the unpredictable nature of the energy markets. However, there is plenty that PBSA providers can do to cushion this blow.
Knowing the numbers
Modern PBSA buildings often contain a number of “Smart Building” features and a large amount now integrate PropTech to help measure, monitor, track, manage and automate energy usage and performance, in particular. Having access to real-time data on energy consumption means that providers can now gain incredibly valuable insights on how energy is being used throughout the building. This includes identifying the days of the week and times of day when usage levels spike, understanding the areas, components, features and devices within a building that consume the most energy and, crucially, revealing when, where and how energy is being wasted.
As an industry, I’d say we are very much at the start of our PropTech journey in terms of investment and implementation, however we won’t realistically be able to unleash its full potential until we understand that these innovations are just one part of a bigger puzzle.
Sustainability strategies
Having all this information at your fingertips is one thing, but knowing what to do with it is another, and this can make all the difference. Looking beyond their BREEEAM ratings, PBSA providers are increasingly turning to more all-encompassing ESG strategies, particularly when it comes to sustainability.
Tirelessly forging the right partnerships and collaborations with experts and innovators in this field is fundamental. At true student, as part of our wider ESG strategy, we recently decided to take our commitment to carbon footprint reduction to the next level by partnering with Mission: Net Zero to help reach our goal of achieving Planet Mark certification. Not only does this partnership and accreditation ensure that our buildings are on the right path towards Net Zero, but it also means that we can set ourselves benchmarks and targets for reducing energy usage, emissions and waste, and measure our progress towards a definitive objective – an objective that will lead us to becoming more sustainable and energy efficient in the process.
The perfect partners
In a recent survey we carried out with over 2,000 young people (age 15-22), climate change and environmental issues were revealed as one of the top three most important issues to them. Students generally care deeply about the planet and are extremely willing and supportive of endeavours to cut emissions, lower consumption and live more sustainable lifestyles.
Operators and providers can really capitalise on this by making the reduction of energy consumption a truly collaborative process that students can get involved in. At true student we try to do this with our student guests in an informative, transparent and fun way (without being too condescending!). We recently launched an awareness and engagement campaign in all our buildings to help students understand the main contributors towards high energy consumption. We are also set to launch a competition between our sites to incentivise energy reduction further, rewarding those who make the biggest reductions.
The energy crisis has been a bitter, and financially crippling, pill to swallow for the student accommodation sector. But the burden of these massive operational costs is leading us to carve out new paths towards our sustainability goals. By implementing innovative new technologies, building new alliances with experts in the field and working closely with our enterprising and savvy student tenants, we can ride out the crisis together.
