Shortage of student accommodations offers potential for investors
In Switzerland, only one in ten students finds accommodation on campus or in a residence hall. Global Real Estate of Credit Suisse Asset Management recognized this potential as long as ten years ago.
The trend toward growing numbers of students at Swiss universities continues. The Swiss Federal Statistical Office anticipates annual growth of between 0.6% and 1% up to 2027. Compared to 2017, when around 247,000 students were enrolled at Swiss universities, a decade later the figure will have increased to approximately 267,000. The students need affordable accommodation, which is already scarce in the city centers, where most educational institutions are located.
Supply is rising, but is not sufficient
Although the supply of student accommodation is increasing, it is still far from meeting demand, which is why the shortage of accommodation offers attractive investment opportunities. While many institutional investors are only just discovering this potential, Global Real Estate has already been making targeted investments in the education sector and particularly in residential real estate for students for ten years. The properties held by Global Real Estate in the education sector include Belvédère in Leysin and Europe in Montreux.
One special segment comprises international students in Switzerland, including in the field of hospitality management, where Swiss training establishments have an outstanding reputation worldwide. Global Real Estate is therefore working with Swiss Education Group (SEG), among other organizations, which is one of the ten largest operators of residence halls in Switzerland.
Going to school at a hotel
One exceptional property owned by Global Real Estate is the former Hotel Mont Blanc Palace in Leysin in the Canton of Vaud, where the Swiss Hotel Management School run by SEG is located. The unique concept enables students to work, learn, eat, and sleep in the rooms in the hotel that have been renovated. As part of their training, they manage the kitchen, the restaurant service, the offices, and the reception, and run the hotel for their fellow-students, who benefit as guests from all the amenities. This includes the use of the spa area and eating in the fine dining restaurant. Teaching takes place in the former ballroom, in the conference rooms, and in the renovated hotel rooms. Demand for places in such courses is high – as are occupancy levels.