CAMPUS QUARTER Australia’s Purpose-Built Student Accommodation market 2025
Scape Franklin, Melbourne
AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
Cedar Pacific UniLodge. Kensington
KEY TAKEAWAYS
Record-high occupancy and rent growth
Supply will improve but challenges remain
Provision rates remain structurally low Australia has 3.4 international students per bed and 8.7 total students per bed; a much lower provision rate than global benchmarks. This underscores a significant runway for growth.
Most stabilised assets are operating at 95-100% occupancy, rents have seen double digit growth since 2022 and lease up periods are shortening with booking windows opening earlier. Constrained supply will keep upwards pressure on rents.
There are just over 10,000 beds under construction nationally. Improving cost of finance and economic outlook, along with stabilising construction costs should help more projects move from DA stage to construction.
Investor appetite returning, but stock is tightly held
Policy reforms have largely spared the core PBSA cohort Despite headline noise, most new visa measures have targeted sub-university segments, with full-time university students — PBSA’s key tenant base — largely unaffected.
ESG in focus Accommodation that has a strong student well-being offer and environmental performance is increasingly important for renters. Strong sustainability credentials can increasingly help unlock funding.
Capital is re-engaging, particularly via platform plays and forward-funding deals, as stabilised opportunities remain scarce and very sought after. Global capital is increasingly targeting Living sectors and growing transactional evidence and opportunity for scale will help activity.
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AUSTRALIAN PROPERTY INSIGHTS
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SECTOR OVERVIEW
Sentiment has rebounded following pandemic era challenges. Occupancy has recovered to record highs, rental growth is strong and demand remains structurally underpinned. Investor interest has returned following a subdued 2024, characterised by capital markets challenges and policy risk.
With over 550,000 international students and a growing pool of mobile domestic students, Australia’s PBSA fundamentals are grounded in global education demand, liveability, and sustained housing need. Australia significantly lags more mature global markets in terms of provision rate and institutional depth, indicating a very promising runway for growth. An improving economic picture, bringing lower finance costs, alongside more policy clarity on international student numbers, will help unlock more investor capital. GLOBAL CONTEXT AND MATURITY COMPARISON Despite being one of the most popular destinations for international students, PBSA in Australia remains relatively underdeveloped. Fewer PBSA beds are offered, and a smaller proportion of students are housed in professionally managed stock, than peer countries. Most domestic students live at home or in private rentals, and international students compete for limited options. The PBSA sector is roughly a $20 billion market in Australia compared to around £90 billion ($184 billion) in the UK. Australia thus has the demand profile of a mature market, but the supply and institutional depth of an emerging one. That paints a very attractive picture for investors – particularly as Australian universities continue to attract international students.
CHART 1
STUDENT TO BED RATIO
12
1,200,000
10
1,000,000
8
800,000
6
600,000
4
400,000
2
200,000
0
-
US
UK Canada Australia
Number of Beds
Students per Bed
Source: Cushman & Wakefield Research
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AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
CHART 2
MAJOR AUSTRALIAN PBSA OPERATORS BY MARKET SHARE
EPIISOD/dwell
Yugo
Student One
Journal
The Switch
UniLodge (GPT)
UniLodge (Cedar Pacific)
Accolade
Iglu
Scape
0
5,000
10,000
15,000
20,000
25,000
Operational
Pipeline
Source: Cushman & Wakefield Research
MARKET STRUCTURE AND LEADING PROVIDERS The Australian PBSA market is led by a handful of scaled owner-operators. Scape is the largest participant, owning and operating around 41% of the country’s off-campus PBSA beds. Scape has used a strategy of acquisitions – including Atira Student Living (about 3,500 beds, acquired in 2019) and Urbanest (about 6,800 beds, acquired in 2020) – as well as a steady pipeline of new development to fuel its expansion since entering the market in 2013. As at 2025, Scape manages 18,890 operational beds across 38 assets, with a further 3,600 beds in the pipeline. Other key players include Iglu, Accolade and UniLodge, each with strong metro footprints. Most institutional platforms follow a vertically integrated owner-operator model, managing both the real estate (PropCo) and operations (OpCo) under the same umbrella. This structure, which is also common in the UK, gives operators tighter control over service delivery, asset performance and improves operational efficiency.
PROVISION RATE: ROOM FOR GROWTH
Australia’s PBSA provision rate remains low relative to global peers. While purpose-built stock has expanded over the past decade, availability still falls short of demand in key education cities like Melbourne and Sydney. This structural undersupply is a defining feature of the Australian PBSA landscape and sets the stage for continued growth.
Scape Swanston, Melbourne
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AUSTRALIAN PROPERTY INSIGHTS
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DEMAND DRIVERS A STRUCTURALLY SUPPORTED DEMAND BASE
PBSA demand in Australia is anchored by two complementary cohorts: international students and a growing base of mobile domestic students. Together, they form a resilient tenant pool that underpins occupancy across key education precincts. INTERNATIONAL STUDENT DEMAND: A CORE ENGINE In 2024 Australia welcomed just over 500,000 international students, a level that now exceeds pre-COVID peaks. Demand is driven by a mix of globalised student preferences, relative value to competing countries, closer proximity to home for Asian students, the strength of Australia’s tertiary institutions, and supportive visa and post-study work settings. Early indicators are suggesting that international students are increasingly looking at alternatives to the US due to concerns over immigration policies. This will likely be supportive for Australian demand in the coming years. Recent visa reforms have shifted the narrative toward quality over volume. These changes have primarily impacted the non- university sector. PBSA-relevant students, who are typically full-time, degree-enrolled, and financially secure, have been largely unaffected.
CHART 3
INTERNATIONAL STUDENTS’ CHOICE OF DESTINATION (2023)
Malaysia
Netherlands
Japan
China
France
Australia
Canada
Germany
UK
USA
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Number of International Students
Source: UNESCO, Statista
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ANNUAL COST OF AN UNDERGRADUATE DEGREE FOR INTERNATIONAL STUDENTS IN ANGLOPHONE COUNTRIES CHART 4
120,000
100,000
80,000
60,000
40,000
20,000
-
USA
UK
Canada
Australia
New Zealand
Tuition
Accommodation
Living Cost and others
Source: Times Higher Education (2023)
SUSTAINED ASIAN MOMENTUM Much of Australia’s international student demand is concentrated in Asia. This regional orientation gives Australia a distinct competitive edge over other the US or Europe: • S horter flight times and minimal time zone difference F rom most major Asian cities, Australia is significantly closer than the US or Europe. Australian cities are within 1 to 3 hours of most Asian time zones, compared to 8-to-12-hour time differences with the US or UK. • Relative value T he Australian dollar has depreciated against the Chinese and Indian currencies over the last year and is significantly weaker than the currencies in the US and UK. Along with this, tuition fees are substantially lower than the UK and US. • D omestic Student Mobility: A Growing Force G rowing domestic student mobility is also adding to PBSA demand. In 2024, over 230,000 Australian students chose to study interstate. This represents 21% of total full-time enrolments, up from just 12% in 2009. W ith limited on-campus stock and traditional shared housing less viable for first-year students due to rising rents, making PBSA the most suitable option for this group.
Cedar Pacific UniLodge. Kensington
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CUSHMAN & WAKEFIELD
AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
Scape Franklin, Melbourne
CHART 5
DOMESTIC STUDENTS STUDYING INTERSTATE
250,000
22%
20%
200,000
18%
150,000
16%
100,000
14%
50,000
12%
-
10%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Source: Department of Education, Cushman & Wakefield Research
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AUSTRALIAN PROPERTY INSIGHTS
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SUPPLY SNAPSHOT
CURRENT NATIONAL FOOTPRINT Australia’s off-campus PBSA stock remains highly concentrated with stock primarily clustered in capital cities with major universities, particularly Melbourne, Sydney, and Brisbane, where education infrastructure and demand are most concentrated but where land and delivery constraints are most acute.
CHART 6
NUMBER OF OFF-CAMPUS PBSA BEDS BY STATE/TERRITORY
NT 300
QLD 16,000
WA 1,900
SA 7,100
NSW 11,000
ACT 750
VIC 26,000
TAS <100
Source: Cushman & Wakefield Research
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AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
WHAT’S IN THE PIPELINE? Australia’s national PBSA pipeline of 21,900 beds overstates what’s actually progressing; over 10,000 beds are under construction today, with the remainder in early feasibility, planning, or approvals. The volume of beds that will be delivered in the next 2 to 3 years is low, particularly in markets already under acute supply pressure. While demand is clearly visible, project conversion challenges exist. Many proposed projects sit with DA approval but no construction contract or funding commitment in place.
This is a result of several factors including zoning complexity, urban infill restrictions, limited site availability, construction costs, debt costs and uncertain valuation exit assumptions. However, the cost of finance is improving with the rate cutting cycle underway and there is appetite from commercial lenders and debt funds to deploy capital. Construction costs, while still high, are stabilising and the policy picture is more certain. This environment should help more schemes move from DA approval to construction. Developers and universities are also exploring solutions – including public-private partnerships and conversions of other property types – but these will take time to bear fruit.
UNDER CONSTRUCTION
2,600 beds SYDNEY
2,000 beds MELBOURNE
1,600 beds PERTH
3,170 beds BRISBANE
675 beds ADELAIDE
CHART 7
NATIONAL PBSA SUPPLY FROM 2016 TO 2030+
0 1000 2000 3000 4000 5000 6000 7000 8000 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Completed
Under Construction
Source: Cushman & Wakefield Research
CHART 8
STUDENTS PER BED
4 6 8 10 12 14 16
0 2
Sydney
Melbourne
Brisbane
National
International
Total
Source: Cushman & Wakefield Research
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AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
Cedar Pacific UniLodge. Kensington
NATIONAL PBSA SUPPLY AND DEMAND IMBALANCE CHART 9
PROVISION RATES TRAIL DEMAND Australia’s PBSA provision rates remain well below global benchmarks – both on a per-student and per-city basis. Across the country, there are around 3.6 international students per PBSA bed, and 8.5 total students per bed (including domestic enrolments). By contrast, markets like the UK have closer to one international student per bed. In Australia, the structural shortfall is most pronounced in Melbourne and Sydney where population growth, high international enrolments, and a lack of affordable private rental stock converge. Unlike the UK and US, Australian universities have typically focused on their core function of education rather than providing accommodation and have historically leant on the private sector to house students. As a result, a tight private rental market has compounded the under provision of student housing. Students are increasingly being priced out of private rentals or are struggling to secure leases amid competition from other demographics. Along with this, the desire for the living experience that PBSA can provide – community, amenity and well-being, helps lend to the sector’s appeal. Chart 9 shows the composition of the Australian student cohort relative to purpose built accommodation, illustrating the significant structural nature of the imbalance.
1400000
1200000
1000000
800000
600000
400000
200000
0
2024 Students
2024 Student Housing Beds - On/O campus & Pipeline
International
Rural
Interstate Domestic
Source: Cushman & Wakefield Research
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AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
OCCUPIER MARKET
OCCUPANCY AT RECORD HIGHS Australian PBSA assets are currently operating at their highest occupancy levels since the sector’s emergence. Most stabilised buildings are reporting occupancy between 95% and 100%, with even newly completed assets letting up quickly. Letting cycles have shortened, booking windows are opening earlier, and pre-commitment rates are rising.
While PBSA traditionally sees seasonal softness during semester breaks, recent years have shown less volatility as more students opt to stay year-round, and mid-year intakes expand. The return of international students – particularly those from Asia – has reinforced base occupancy, while growing domestic mobility has added a secondary layer of demand. Operators are also reporting reduced churn, reflecting a student preference for secure, service-led housing in uncertain rental markets.
CHART 10
AUSTRALIAN PBSA OCCUPANCY 2018 - 2025
90
80
70
60
50
40
30
20
10
2018
2019
2020
2021
2022
2023
2024
2025
Source: Cushman & Wakefield Research
Scape Redfern, Sydney
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AUSTRALIAN PROPERTY INSIGHTS
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CHART 11
PBSA RENTS (AVERAGE ALL ROOMS TYPES)
$1,000
$800
$600
$400
$200
$-
Sydney
Melbourne
Brisbane
2023
2024 2025 YTD
Source: Cushman & Wakefield Research
RENTAL GROWTH MOMENTUM PBSA rents have rebounded strongly post-COVID and continue to trend upward. Studio rents jumped 20% from 2022 to 2023, and although growth has moderated more recently, benchmarks remain well above pre-COVID levels across all capital cities. Operators have generally adopted a measured approach to rent increases in recent intakes amid political sensitivity around affordability. Underlying fundamentals – tight vacancy, limited competition, and a strong demand base – continue to support sustained pricing power. The sector’s six-to-twelve-month leasing model also enables operators to reprice rents more frequently than traditional residential assets; this ability to mark rents to market is a source of income resilience.
AFFORDABILITY ADVANTAGE VS PRIVATE RENTALS Although PBSA headline rents can appear high, they compare favourably to private rental options when bundled living costs are factored in. PBSA typically includes; furniture, internet, electricity, water, security, students services and eliminates the need to enter competitive private rental application processes. All-in rental costs for private studio apartments are approximately 33% higher than PBSA in Sydney, 17% higher in Melbourne and 13% higher in Brisbane. These differences are particularly pronounced in inner-city precincts where students need to compete for private rentals with young professionals. Furthermore, PBSA offers access to on-site support, community programming, and an accommodation model designed around student schedules, additional features essential for student tenants.
CHART 12
PBSA VS PRIVATE WEEKLY RENTS
$1,000 $1,200
$- $200 $400 $600 $800
Sydney
Melbourne
Brisbane
Rent
Gym Furnishing Utilities Internet
Source: Cushman & Wakefield Research
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AUSTRALIAN PROPERTY INSIGHTS
CAMPUS QUARTER
CAPITAL MARKETS
GROWING INSTITUTIONAL DEPTH PBSA has evolved from a niche alternative into a core component of institutional living strategies. Over the past decade, the sector has attracted increasing interest from both domestic and offshore capital, drawn by a combination of defensive cashflows, demand resilience, and a structural under-supply backdrop. The student tenant base is seen as stable and less volatile than transient renters in traditional residential markets. GLOBAL CAPITAL STILL ACTIVE PBSA continues to attract global capital, even amid broader caution across real estate sectors. The latest ANREV Investment Intentions Survey saw 43% of respondents identify PBSA as a preferred investment sector in APAC. Large-scale transactions in the US and UK – often involving multi-asset platforms or institutional JVs – reflect long-term conviction in student housing’s demographic resilience and income stability. In Australia, while total volume is smaller, the deal profile has evolved. Early-stage acquisitions (2015–2020) focused on growth platforms and development pipelines. In recent years, capital has pivoted toward: • Stabilised platform acquisitions, such as Greystar’s AUD 1.6bn purchase of the Wee Hur portfolio, and Blackstone’s AUD 530m acquisition of Student One. • Partial interest stakes, such as GIC’s AUD 500m investment in Wee Hur in 2022. • Joint ventures and fund-through deals, often in partnership with local operators or developers. Notably, higher interest rates have not fully reversed yield compression – suggesting that investors are willing to price through the rate cycle based on asset scarcity, income durability, and longer-term positioning.
By comparison, prime BTR yields have compressed to the low- 4’s in Sydney and Melbourne. Factors driving yield positioning: • Operational intensity: requires dedicated on-site management, leasing and student services. • Turnover structure: With most leases on 6 to 12-month terms, operators manage higher tenant churn but benefit from more frequent repricing cycles. • Demand defensiveness: Student demand is relatively inelastic and counter-cyclical, supporting cashflows through downturns. Liquidity remains constrained not by demand, but by stock availability. Most large PBSA portfolios in Australia are now institutionally held or backed by long-hold capital, meaning traditional exit opportunities are rare. As a result, future activity is expected to concentrate around recapitalisations, development pipelines, and GP-led secondary transactions, rather than open-market sales. We have also seen the emergence of sustainability-linked financing for the sector, a theme which is common in Europe. The most notable example is Scape’s conversion of $1.4 billion loan into a sustainability-linked loan (SLL) to assist in meeting its environmental, social and governance (ESG) targets. SCALABILITY AND REINVESTMENT As the sector matures, attention is shifting from asset selection to platform scalability and long-term alignment. The recent transfer of Scape’s portfolio into an open-ended fund structure marked a pivotal moment – creating one of the largest unlisted real estate vehicles in Australia and signalling a more permanent capital orientation for the sector. This shift opens the door to greater reinvestment capacity, capital recycling, and co-investment opportunities.
PRIME STABILISED YIELD
4.75% SYDNEY
5.00% MELBOURNE
5.50% BRISBANE
5.50% CANBERRA
5.75% ADELAIDE
5.75% PERTH
Cedar Pacific UniLodge. Kensington
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AUSTRALIAN PROPERTY INSIGHTS
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OUTLOOK
POSITIVE LONG-TERM FUNDAMENTALS
RESILIENCE IN FOCUS The post pandemic period has highlighted the defensive characteristics of PBSA. Occupancy has rebounded ahead of expectations. Rents are at all-time highs. Capital is returning – not tentatively, but with a long-term view. And perhaps most importantly, the sector has proven it can weather policy turbulence, demand shocks, and construction delays without undermining core performance. Looking ahead, the key challenge for investors is not proving the value of the asset but gaining access. Australia’s PBSA sector is likely to remain tightly held, operationally defensive, and highly investable.
Core demand drivers – including growing international student mobility, domestic enrolment shifts, and rising urbanisation – remain intact and continue to reinforce a deep, stable renter base. At the same time, Australia’s broader rental market continues to face extreme pressure. Housing affordability constraints, low vacancy, and a shortage of rental stock in key university precincts are all pushing students toward PBSA as a secure, bundled, and predictable alternative. DEVELOPMENT PIPELINE RISKS High construction costs, lengthy planning approvals, and uncertainty around cost of capital have slowed project conversion across most major cities. As of early 2025, less than one-third of the national PBSA pipeline is actively under construction, and completions are unlikely to accelerate meaningfully before 2026. This picture should improve as macro tailwinds recede but supply will remain very constrained relative to demand.
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Research
Capital Markets
Josh Rose-Nokes Director, Living Research, APAC josh.rosenokes@cushwake.com
Conal Newland International Director, Head of Living, APAC conal.newland@cushwake.com
Dr Dominic Brown Head of International Research, APAC & EMEA Dominic.Brown@cushwake.com
Louise Burke Director, Living Capital Markets, ANZ louise.burke@cushwake.com
Lin Lee Senior Strategic Research Analyst, Australia lin.lee@cushwake.com
Paul Savitz Director, Living Capital Markets, ANZ Paul.Savitz@cushwake.com
About Cushman & Wakefield Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2024, the firm reported revenue of $9.4 billion across its core service lines of Services, Leasing Capital Markets, Valuation and other. Built around the belief that Better Never Settles, the firm receives numerous industry and business accolades for its award-winning culture. For additional information, visit www.cushmanwakefield.com.
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