Failing upscale student blocks hand the cost of collapse to their tenants

Nathalie Sriwiboonrattan, a fourth-year game design student at Abertay University, was at home with her family in Thailand when she found out the owner of her studio flat had gone bust ^[6]. "I was like, my hands are tied. I'm not in the country. I don't know what to do," she said ^[8]. She found new housing for the year and paid £850 to have her possessions moved ^[7].

The claim that universities and funders now carry counterparty risk rests on more than one failed block. Arrivals from China have stagnated ^[15], and financial institutions developed much of the recent building boom ^[16]. Even so, the reporting does not show any university with a contract with a failed operator, or any lender writing down a loan.

Nottingham's figures show how a surplus builds up. Between the 2022-23 peak and 2025-26, demand there fell by 4,005 beds, about 8.7% ^[19][21]. Add the 7,700 new beds ^[13] and the city's balance moved 11,705 beds toward oversupply over that period ^[20]. The Dundee collapse happened this term. Nottingham's surplus took three academic years to build, and I would expect it to last longer than one bad term, because beds that are already built stay on the market.

A skeptic would say this is a handful of overbuilt regional markets, and that London, which attracts the richest students, still has demand for upmarket rooms ^[5]. That is true, and it narrows the risk to particular cities. It does not reduce the risk for the institutions in those cities. Dundee, where Marketgait failed, and Nottingham, with its surplus, are two of the three cities where university staff walked out over budget cuts this week ^[9][13][14].

Price is the other pressure on demand. StuRents puts the average purpose-built rent outside London at £191 a week including bills ^[3], about £828 a month ^[18]. Soham Chougale, 23, a student at University College Birmingham, paid £660 a month including bills in university-owned halls in his first year ^[12]. He said that because he is an international student, his working hours are capped at 20 hours a week in term time, which means he cannot afford to live in PBSA ^[11]. "PBSA can be quite pricey," said Matthew Pointon, a real estate analyst at Capital Economics, who added: "Normally professionally managed buildings are better in terms of quality." ^[4]

For a university, the trade-off is between capital and control. In my view, each student who rents from a private block is a bed the university did not have to finance, and also a tenancy it cannot protect if the owner fails. This quarter's choice is whether to count the solvency of private blocks near campus as part of the university's own housing risk. If it does not, next summer's failures land on students who must find their own rooms. The fallback is already thin. In Bristol, the students' union's email to new students gave an emergency number for Shelter, the housing charity ^[17].