Key facts
- Unite Students reported a £417m pre-tax loss for the six months to June.
- The loss was driven by a £530m revaluation of its property portfolio and challenging building costs.
- Unite plans to divest up to £400m of its property assets.
- Occupancy rates are expected to reach 94-96% for the current academic year.
- Unite criticized new regulations and rising costs for making new student accommodation development difficult.
Unite Students reported a £417 million pre-tax loss for the first half of the year, a sharp reversal from the £186 million profit in the prior year. The loss was primarily attributed to a £530 million revaluation of its property portfolio and significant increases in building costs. Adjusted earnings fell 2% to £142 million. The company plans to divest up to £400 million of property to concentrate on students at the UK's strongest universities. Unite anticipates occupancy rates between 94% and 96% for the current academic year, with rental growth of 1% to 2%. The acquisition of rival Empiric last August contributed to an 11% increase in rents to £262 million. Unite warned that soaring construction costs, tighter regulation, and lower investment values are making new student accommodation developments unviable across much of the country, requiring rents above £300 per week outside London to be financially feasible, compared to the current average of £190 per week. Unite shares fell 3.4% to 538p.