PBSA market faces 'difficult year' but 'there's always going to be a need' for it

In an exclusive interview with Development Finance Today, Kevin Sharkey, co-founder of Key Land Capital (featured in the video above), expects it will probably be a “difficult year” for the student accommodation market, but is optimistic that normality will return by January next year.


DFT had asked Kevin what challenges and opportunities the PBSA and office-to-residential markets were currently facing.

“There [are] a number of challenges in the student sector at the moment, obviously with students not being at university,” he said.

He explained that if online learning is continued until later this year, or even up to the start of 2021, that would be a hurdle for the student accommodation market.

“They’re reliant on students moving to where the university is and living in situ."

He said this could result in a structural change if some courses are only delivered online.

“I think there’s always going to be a need for student accommodation — certain courses can’t be done online, just by their very nature.

“I would say that it’s probably going to be a difficult year for the student market, but we [are] optimistic that, by January next year, people will be back to a normal way of operating.” 

When discussing the office-to-residential market, he said that the challenges revolved around the available stock, considering a lot of buildings had been converted already as a result of PDR.

“We’ve got to a point now ... where there just [aren't] as many buildings available that can be converted into residential,” he added.

DFT asked Kevin whether the likelihood that more businesses will work from home after lockdown would bring more stock to the market.

“There’s going to be less people in the office, but I think that those that are will require more space, just because you can’t have a bank of six desks with people sitting opposite [each other] — it’s just not going to be permitted, now,” he said.

“I think there will definitely be a structural change, but I just don’t see vast amounts of office space suddenly becoming available."

In May, Kevin acquired full control of Birmingham-based development and investment business Key Land Capital, stating that it had ambitious growth plans and developments in the pipeline. 

Kevin discussed with DFT the importance of fintech and smart buildings in property development and construction, how it plans to use blockchain to enable investors to invest in its properties this summer, and whether MMC will become more popular in the future. 

The full interview can be viewed below.

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