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PBSA in focus: what’s happening in the Midlands?

Last year we published a report on purpose-built student accommodation (PBSA) exploring the data, influence, and policy behind this growing sector across the UK and Ireland. As the new university term starts, we’re taking our national lens local, focussing on the Midlands.

The UK and Ireland PBSA report is available here. 

With students across the country returning to university, or starting for the first time, the national press is debating where the most acute shortages of accommodation are being experienced. Our research finds that across the Midlands, Birmingham and Nottingham in particular, there’s a critical need for more PBSA development. 

Key findings

• There is a general theme across the Midlands that there is a shortfall in supply of student accommodation.
• PBSA represents a clear solution to tackle this undersupply.
• Evidence suggests students prefer purpose-built accommodation.
• PBSA can help rebalance housing stock and assist in addressing the housing crisis – affording an opportunity for houses lost to HMOs to be converted back to family dwellings.
• PBSA delivery supports universities’ growth and expansion, in turn supporting the key strategic role they play in knowledge- and innovation-based economies.

Wider context

It is now commonly recognised by local authorities that increased provision of high-quality PBSA is required to address shortfalls in supply of student accommodation and redress localised imbalances that have been created through the historic conversion of family dwellings to Houses of Multiple Occupation (HMOs). The latter has further restricted supply of family dwellings at a time of growing demand thus acutely exacerbating the existing housing crisis. This has also led to seasonal local economies and an imbalance in the mix of uses within communities of high HMO concentrations.

Birmingham

Birmingham is home to five universities: University of Birmingham; Aston University; Birmingham City University; University College Birmingham, and Birmingham Newman University, all of which have ambitious growth plans which will increase the city’s student population. The city also hosts campuses from University of Bedfordshire, Roehampton University, University of Wales Trinity Saint David, and Ulster University, generating additional demand for student bedspaces across the city. 

Recent trends illustrate the effects of increasing demand and supply can vary across the city.

Addressing issues in Edgbaston and Selly Oak

Perhaps the most immediate issue for Birmingham is addressing the significant shortfall in supply of PBSA within the areas of Selly Oak and Edgbaston (up to 15,050 bedspaces as of March 2023), with demand largely driven by University of Birmingham. This is also an area with a significant imbalance in housing stock due to the high number of HMOs that have been created over the past decades. The loss of such family homes has occurred against the backdrop of ongoing pressure to build more typical residential dwellings to address the significant housing requirement for the city. There has been an active Article 4 Direction in Selly Oak since 2014, and city-wide direction since 2020, removing permitted development rights to change such dwellings to HMOs, demonstrating that the council sees PBSA as the solution to addressing the shortfall. This approach also opens the door for existing HMOs to be returned to family housing to rebalance the housing stock in the city. 

At the political level, some members of the Planning Committee have, however, been sceptical of the assertion that students prefer PBSA to HMO accommodation and have publicly disputed their own officers’ assessments of need for PBSA. In response to such scepticism, our Strategic Communications team, alongside our PBSA developer clients, are currently producing evidence (through online surveys of West Midlands students) to demonstrate this preference for PBSA over HMOs.

The city centre

In Birmingham City Centre, the situation is quite different. This part of the city has seen the most significant PBSA development activity in recent years, both in terms of planning applications and approvals. Of late, the shortfall in the city centre has reduced significantly; in September 2023 our analysis concluded a shortfall of 2,371, with a number of major schemes in the pipeline which could reduce this figure significantly. 

The perception of over-supply/saturation of PBSA in the city centre has become increasingly contentious to some members of the Planning Committee. However, owing to the planned growth of the city centre universities, demand for bedspaces is expected to continue to rise over the coming years. This will place increasing importance on locating new PBSA in the ‘right’ locations – ones which balance need with political concerns on overconcentration.

We have noted that the location of PBSA development between the city centre and the Edgbaston/Selly Oak areas, close to Five Ways Railway Station, has proven successful. Its proximity to areas of demand in Edgbaston/Selly Oak and the city centre means PBSA development in such areas can address the current spatial imbalances of the student resident population and existing shortfalls. This is evidenced in the recent approval of a PBSA scheme at ‘The Trees’ site, which attributed proportions of its supply to each of the two areas of need. This could become a more common approach to the issue moving forwards.

Nottingham

The number of students attending University of Nottingham (“UoN”) and Nottingham Trent University (“NTU”) that require accommodation has increased by more than 25% from 2016/17, from c.40,000 to 51,000. This figure is set to rise to 56,582 by September 2025 according to NCC figures published in 2022. 

Similar to Birmingham, Nottingham has a high concentration of student occupied HMOs around its universities, with the city fast becoming the fourth largest HMO market in the UK. Issues of poor HMO quality and lack of community cohesion have been identified as key impacts of current student accommodation provision and concentrations. As in Birmingham, the loss of family dwellings to HMOs over recent years has further intensified the need to increase the number of PBSA bedspaces to satisfy the growing need for student accommodation.

Nottingham City Council (in collaboration with and endorsed by UoN and NTU) is preparing a ‘Nottingham Student Living Strategy 2023-2028’ seeking to guide development to meet demand for student accommodation, and will continue to promote PBSA as the preferred approach and reflect this in local planning policies. The council recently approved various PBSA schemes that will deliver more than 10,000 student bedspaces; but despite this pipeline, the strategy notes that PBSA provision has not kept pace with demand to-date and more bedspaces are required. Moreover, less than one year ago, the council’s Director of Planning and Regeneration quoted a shortfall of 5,500 bedspaces in the city, though this figure is understood to have risen since then. 

The opportunity for PBSA development remains significant in this key student city.

Final thoughts

The Midlands is a region where there is a critical need to support the growth of major universities, which are often a significant contributor to local economies. Delivering PBSA to satisfy the growing need for student bedspaces is fundamental to helping these universities grow and expand. 

By overcoming local complexities to address the identified shortfalls in support of the region’s universities’ growth and expansion, PBSA plays an integral role in delivering local authorities’ wider strategic goals, supporting the expansion of knowledge- and innovation-based economies.

We have a strong understanding of the PBSA sector across both the East and West Midlands. Our work spans the entire region, with recent high-profile PBSA projects in almost all major cities, and a strong pipeline of proposals at pre-application stage. 

If you would like to know more, please contact Sam Cripps. 

 

6 October 2023