Unite Group, a leading provider of purpose-built student accommodation (PBSA), is adjusting its strategic focus to prioritise occupancy rates over rental increases for the upcoming 2026/2027 academic year. This decision comes in light of revised lettings expectations, although the overall guidance remains unchanged. The company signals a shift towards a greater emphasis on filling available rooms rather than solely increasing rental prices as the sales cycle approaches its conclusion.
Revised Expectations for Occupancy and Rental Growth
In its recent trading update, Unite disclosed that it now anticipates occupancy levels to fall between 94% and 96%, alongside a modest rental growth forecast of 1% to 2%. This is a change from previous expectations, which had estimated occupancy at a lower range of 93% to 96% and a rental growth projection of 2% to 3%. Despite these changes, the company continues to guide a like-for-like income growth of 0% to 2%.
Implications for Income Performance
This revised outlook suggests that Unite is placing increased reliance on higher occupancy levels to drive income, rather than depending on elevated rental rates. The shift follows positive developments in recent weeks, with 86% of Unite Students’ beds already reserved for the 2026/2027 academic year, a figure that slightly surpasses last year’s reservations at the same time.
Unite attributes this strong leasing performance to effective direct-let sales strategies and targeted pricing adjustments in key markets, alongside ongoing dialogues with university partners in light of undergraduate offers.
Broader Industry Context
For many PBSA operators, there is often a heightened focus on occupancy rates during the later stages of the lettings cycle. This trend is particularly relevant when the majority of available rooms have already been filled. In such situations, selective pricing strategies can effectively attract remaining demand, thereby supporting overall income performance. Unite appears to be adopting this strategy for the 2026/2027 academic year.
A parallel trend is evident within the Hello Student portfolio, which has benefitted from Unite’s acquisition of Empiric Student Property. Occupancy reservations have risen to 71%, a significant increase from the 61% recorded at this time last year, and the expected occupancy level has been adjusted to at least 87% for the forthcoming academic year.
Unite’s targeted pricing reductions have contributed positively to sales performance, with rental growth projected to align closely with that of the Unite Students portfolio. Although the overall income guidance remains unchanged, this latest update provides valuable insights into how the company plans to achieve its financial objectives. As the sales cycle for 2026/2027 unfolds, the emphasis on occupancy is set to become increasingly significant alongside a more cautious approach to rental growth.