This is, on balance, a welcome direction of travel. The draft policies recognise both the diversity of the modern PBSA sector and its growing role in supporting affordable housing delivery, reflecting how the market has evolved in practice over recent years. Yet, the increased focus on locally defined need and borough-specific priorities also raises the stakes for site selection and location strategy. For developers and investors alike, securing the right site in the right place may become more important than ever.
Nominations flexibility
The relaxation of nominations requirements is perhaps one of the clearest examples of the Draft London Plan aligning policy with market reality. While support from Higher Education Providers (HEPs) remains important, the draft policy moves away from requiring the majority of bedspaces to be tied to nominations agreements and instead focuses this requirement on affordable student accommodation only. This reflects a growing recognition that a one-size-fits-all approach is not always compatible with the increasingly diverse nature of the PBSA sector.
Over recent years, greater flexibility has emerged (formalised through the 2024 PBSA LPG) through the use of reasonable endeavours and cascade mechanisms on private bedspaces, reflecting both operator experience and the business model of universities in securing accommodation. By embedding this flexibility within draft policy HN5, the Draft Plan not only provides greater certainty for delivery but also signals increasing confidence in the maturity of the sector and its ability to respond to student housing needs without overly prescriptive controls.
PBSA to unlock C3 affordable housing
Seeing acknowledgement of the role that PBSA can play in unlocking and delivering much-needed affordable housing was a welcome sight in this draft.
The Draft London Plan version sets out three ways in which boroughs can seek affordable provision for PBSA schemes:
- through affordable student rents
- a mix of affordable rents and payment in lieu for conventional affordable housing
- on-site conventional affordable housing only
Significantly, the draft also brings PBSA within the scope of the new residential Fast Track thresholds set out in Policy HN3, which range from 20% to 35%. This marks a notable departure from the temporary approach adopted through the Support for Housebuilding LPG, where PBSA and purpose-built large-scale living (PBLSL) schemes were treated separately from mainstream residential development for Fast Track purposes.
This is a positive and pragmatic shift. By aligning PBSA more closely with wider residential planning policy, the Draft London Plan has the potential to improve scheme viability while continuing to secure meaningful affordable housing outcomes. It also reflects the direction of travel already emerging across the sector, with developers increasingly tailoring affordable housing offers to respond to local priorities and identified needs.
Recent schemes demonstrate the value of this approach in practice. We recently secured planning permission for the Former Blackfriars Crown Court, Loman Street, Southwark redevelopment, where PBSA played an enabling role to deliver an enhanced level of social rent provision. At a time when London faces acute pressures across both its student and conventional housing markets, the Draft London Plan's recognition of PBSA as part of the affordable housing solution is a welcome and necessary evolution in policy thinking.
Location and targets: The new battleground for PBSA delivery
The Draft London Plan retains the long-standing expectation that PBSA should be located in well-connected locations - now defined as being within 30 minutes of higher education institutions or key services by sustainable modes of transport. It also continues to emphasise the role that student accommodation should play in supporting mixed and inclusive communities. The draft policy also builds upon the LPG (2024) guidance noting that LPAs may consider overconcentration in their plan-making (grouping PBSA with PBLSL).
The more significant shift, however, lies in the Plan's approach to target setting and what this could mean for the future geography of PBSA delivery across the capital.
Under the current London Plan, London-wide targets sought the delivery of 3,500 student bedspaces per year, equivalent to 35,000 bedspaces over 10 years. While delivery has consistently fallen short of this ambition, the target nevertheless provided a strategic, city-wide framework against which need could be assessed. The Draft Plan replaces this with a target of 31,500 additional student bedspaces over the next decade, distributed across individual borough targets.
On the surface, this creates greater borough-level accountability and provides a clearer basis for understanding the role each borough is expected to play in meeting London's student housing needs. However, PBSA demand does not always neatly align with borough boundaries. Unlike conventional housing, PBSA serves a highly mobile population whose accommodation choices are often driven by access to institutions and transport networks rather than administrative geography.
This makes borough-level targets difficult to set and creates some notable anomalies within the proposed targets. The targets appear to be broadly informed by the approach taken to housing targets, resulting in areas such as Westminster and the City of London receiving no identified PBSA requirement despite being home to major HEPs, significant employment centres and some of London's most connected transport infrastructure. Such outcomes raise questions as to whether a borough-led target methodology, set at a regional level, fully reflects the realities of student accommodation demand across the capital.
There is also a risk that the proposed monitoring approach could inadvertently constrain future delivery. The draft policy suggests that completions delivered after the 2026 baseline can be netted off against borough targets. While logical in principle, London's current PBSA pipeline has suffered from under-delivery against previous targets and delivery of much of it has been subject to delays arising from regulatory and legislative changes, including second staircase requirements and Building Safety Act processes such as Gateway 2. As a result, schemes consented under previous policy regimes may contribute towards future borough targets despite not reflecting the scale of need that will emerge over the coming decade. It also doesn’t consider outdated schemes that may be repurposed during the plan period.
Perhaps the most important unanswered question, however, is how these targets will be applied in decision-making. The Draft Plan is clear that targets will be kept under review to respond to changing circumstances within the higher education sector, but it is less clear whether borough-level figures should be treated as minimum expectations, indicative benchmarks or effective ceilings on delivery. This distinction matters. Without greater clarity, there is a risk that some authorities could view target achievement as justification for resisting additional schemes, even where demand remains strong and sites are in highly sustainable locations.
Ultimately, the draft London Plan signals a future in which location will become increasingly important to the success of PBSA proposals. While the policy framework is, in many respects, becoming more flexible, developers will need to demonstrate not only that schemes are well located and connected, but also how they align with local priorities and borough-level delivery expectations. Ensuring that these targets support, rather than restrict, future delivery will be critical if London is to meet the needs of its growing student population.
Out of term time uses
One notable omission from the Draft London Plan is the lack of guidance on how out-of-term occupation should be considered. This is a significant issue unique to the purpose-built student accommodation (PBSA) sector, where development programmes are driven by immovable deadlines linked to the academic year. Schemes must be delivered in time for September intake, yet buildings can remain vacant or underutilised for extended periods outside term time, often in highly accessible and sustainable urban locations.
In recent years, we have observed a wide range of approaches adopted by local planning authorities to facilitate non-term-time occupation. These have included broader descriptions of development supported by “switch-on/switch-off” planning conditions, as well as detailed provisions within Section 106 agreements defining the circumstances and categories of occupier permitted to use accommodation outside term time.
Greater clarity within the London Plan on how such ancillary uses can be secured, and the extent to which they should be controlled, would provide welcome consistency across boroughs. This would help maintain the viability of PBSA schemes, particularly where construction programmes are affected by factors beyond a developer’s control, such as Gateway 2 delays, while also ensuring more efficient use of well-located sites and reducing the risk of seasonal ‘ghost populations’ within London’s urban centres.
For more information on the Draft London Plan’s position on PBSA please contact Alice Yau or Catriona Fraser.
17 August 2026
