A recent survey by Cushman & Wakefield reveals that a notable 80% of European living sector investors are gearing up to expand their investments over the next five years, with Purpose Built Student Accommodation (PBSA) and the Private Rental Sector (PRS) emerging as top priorities. This trend reflects a surge of optimism attributed to demographic shifts, supply shortages, and favourable regulatory environments.
In 2024, the PRS dominated the investment landscape, accounting for €33 billion of the €45 billion invested in European living. However, the PBSA market has gained significant traction, with 75% of investors intending to increase their exposure within a three-year timeframe. This interest largely stems from PBSA’s impressive fundamentals, which include inflation-beating rental growth and fewer regulatory hurdles compared to more traditional PRS markets.
The survey also indicates that co-living spaces are becoming increasingly popular, with investor interest expected to rise from 33% today to 44% by 2028. This signals a broader shift towards innovative living solutions that cater to changing tenant needs and preferences.
Patrick Hogan, Head of EMEA Living Capital Markets at Cushman & Wakefield, emphasised that investments in the living sector not only provide stability and diversification but also generate social value, aligning with environmental, social, and governance (ESG) goals. He noted, “Core European markets remain a primary focus for investors at this stage of the cycle, with a diverse range of capital actively participating in more liquid markets.”
Moreover, the UK continues to hold its position as the most favoured market for investors, with Spain now ranking second, having overtaken Germany. The survey highlighted a shift in acquisition strategies, with forward commitment structures becoming significantly more popular—29% of respondents preferred this approach in 2025, compared to just 18% in 2024. This increase indicates a willingness among investors to engage earlier in the development cycle for prime opportunities in an increasingly competitive landscape.
Despite the promising outlook, concerns remain regarding pricing mismatches, viability, and political changes, which could pose challenges for the sector. Nonetheless, the overall sentiment among investors is optimistic, with expectations of increasing investment activity in EMEA’s living sector in the coming years.
As the PBSA market continues to evolve, stakeholders should remain vigilant to navigate the opportunities and challenges ahead. Embracing flexible investment strategies and adapting to market trends will be vital for success in this thriving sector.