The dearth of student accommodation available in Cape Town presents a major opportunity for the private sector. By 2025, there’ll be close to a million “missing beds” countrywide to keep up with the government’s ambitious university enrolment growth plan. Helping to meet this need could be a major stimulus for the Mother City’s CBD.
In 2020 there was a 511 600 student bed shortage in our country, according to a Market Assessment Study by the International Finance Corporation (IFC). Add the South African government’s ambition to grow university enrolments to 1.6 million by 2025, and this demand gap is set to grow to around 781 000 beds.
With continuing public sector budget constraints, private property developers will have an important role to play in meeting this demand. Currently, there are 13 668 student beds in Cape Town and a student population of close to 75 000, leaving a 60 000-bed shortage for the University of Cape Town (UCT), Cape Peninsula University of Technology (CPUT) and the University of the Western Cape. All three institutions have campuses in and around the Cape Town CBD. This means ample opportunity for CBD housing initiatives.
The Cape Town Forecourt development by Eris Property Group at Cape Town Station.
CBD SET TO CAPITALISE ON MARKET
Says Rob Kane, chairperson of the Cape Town Central City Improvement District (CCID) and CEO of Boxwood Property Fund, “To capitalise on this market, it’s imperative that the CBD remains a welcoming, safe, and clean space for students and investors alike. The CCID plays a massively important role in this.
“We are excited about the continued influx of students, especially with the new development by the Eris Property Group, which secured the forecourt of the Cape Town Station on a long-term lease from the Passenger Rail Agency of South Africa for developing a completely reimagined and vibrant student precinct spanning 2.5 hectares.”
Jan van Vuuren, the executive head of student accommodation at the Eris Property Group, adds, “The first phase of this development will provide 6 700 m² of modern retail space, a 3 085-bed, purpose-built student accommodation facility and a new world-class public square.”
The group – which has purpose-built student accommodation (PBSA) developments across Africa – secured, amongst others, a R150-million boost from the World Bank Group to develop more dedicated student housing units.
This will be added to the R500-million injection into SASAII (South African Student Accommodation Impact Investments) by prominent investors such as Momentum Alternative Investments, Eskom Pension and Provident Fund, and the IFU through its Danish Sustainable Development Goals Fund.
The rise in the micro-apartment trend could meet student accommodation demands: both One Thibault (right) and Foreshore Place (left) have micro apartments.
IMPORTANCE OF VIBRANT INNER CITY
Commenting on the priorities in terms of spending these funds, Van Vuuren says that Cape Town and its vibrant inner city are very important markets for the group. “We are looking for opportunities across South Africa at almost all the universities. Cape Town has become attractive for developers and investors as it has a high density of students at universities as well as other tertiary institutions. Additionally, greater Cape Town’s councils and municipalities are fairly easy to navigate when it comes to the town planning process and bulk services are mostly available, thanks to organisations like the CCID, no doubt.”
RIGHT KIND OF ACCOMMODATION
According to published research, there is a clear correlation between student performance and the right kind of student accommodation. On- or near-campus accredited accommodation often works better as it’s designed to meet students’ specific learning requirements, is typically safe, and offers easy access to campus.
As more providers investigate student accommodation, it’s important a global standard is adhered to. To this end, the Department of Higher Education developed a policy on minimum norms and standards for student housing at public universities.
Says Desseré Badelt from Student At Home, which provides student accommodation in the heart of the Mother City, “The minimum norms and standards have an important role to play in PBSA in this country to ensure that ethical practices are adhered to by providers.”
Uxolo residential development in Vredenburg Lane, off Long St.
SAFETY FIRST
Safety is a top consideration when it comes to student housing. In the CBD, the CCID plays an active role in this as it has over 300 Public Safety Officers patrolling the CBD in shifts 24 hours a day.
Says CPUT student Zikhona Sami, “As a student from an Eastern Cape village, a safe environment is very important, and it is good to see CCID guards at all times – it makes you feel comfortable moving about in the CBD.” Her initial struggle to find suitable accommodation when she moved to the city emphasises the shortage of suitable student housing. “For example, I could not attend my first-year orientation, which was a big loss for me.”
Another CPUT student, Yandisa Sontsele, concurs, “Initially, I missed classes as I had to stay quite far from campus. Living in the CBD now, however, has improved my experience substantially – the Central City is clean, safe and the transport is reliable. I really enjoy living and studying here.”
LOCATION, LOCATION, LOCATION
Whether a student will live in PBSA, a rental property or one owned by their parents, the same factors need to be considered when choosing a residential area. The location should offer easy access to campus and attract other students, says Thibault Investments’ Grant Elliot. “As a board member of the CCID, I am proud of the work this organisation does to ensure that the CBD is poised as a student accommodation hub to alleviate the housing shortage.”
He concludes, “We believe the residential population – that’s to say permanent residents in the CBD – will double in the next few years, and while it puts more pressure on space and services, it is without a doubt a positive. A structure has no purpose without people – Covid-19 taught us that cities must do more to attract permanent and semi-permanent residents like students to keep it ‘alive’.”
IMAGES: CCID, Carmen Lorraine
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