Parents will have to dig deep to pay for student digs
Cantillon: Monthly charges of up to €1,400 are beyond the means of many college students
Students at Trinity College, Dublin. The general squeeze on accommodation in Ireland has spilled over into the student market. Photograph: Frank Miller
Students – and possibly their parents – are presumably on the hunt for accommodation for the coming academic year, if they have not already nailed down a place to stay.
The general squeeze on accommodation in Ireland over the past number of years has spilled over into the student market, which is really an offshoot of the private rental sector.
The shortage is most keenly felt in cities and large towns that are home to third-level institutions. Obviously, this is at its worst in Dublin.
This appears to be good news if you’re investing in specialist student accommodation. US-backed Bain Capital Ireland and its partner Carrowmore last year bought a site in Brickfield Lane in Dublin 8, with planning for 270 student beds, for €8 million from three private individuals.
Now that work is under way, US multinational Invesco Real Estate has pledged to pay €47 million for the building once it is completed next summer, just in time for the 2019/20 academic year. Invesco is also funding part of the construction cost, which will run somewhere north of €30 million.
Modern, purpose-built student accommodation is a far cry from the bedsits and house-shares that were a staple of the market for years. The rooms are self-contained and in buildings featuring lots of facilities, often gyms, meeting rooms, even miniature entertainment venues.
They are also expensive to build. Figures from Linesight, the consultancy that produces regular data on construction costs, show that purpose-built student accommodation costs between €1,850 and €2,690 per sq m. Linesight’s figures for apartments are €1,601 to €2,380.
They are also expensive to rent. Earlier this month, the Union of Students of Ireland complained that the monthly charges of €1,000 to €1,400 were beyond the means of many members.
This could well ease when demand catches up with supply, but that still seems some way off. Bain won’t need to concern itself with that, as it will already have banked a tidy profit from its brief foray into the sector.