European PBSA 101: Top of the Class is the first paper in our three paper series on Purpose-Built Student Accommodation (PBSA). Here we set out why the European PBSA sector provides a compelling investment opportunity.
There are more than 14 million students across Europe, yet only one-in-five domestically mobile or international students are able to access a PBSA bed.
Underpinned by 70 universities ranked in the world’s top 250, Europe’s higher education sector benefits from supportive polices aimed at lifting attainment rates, along with a large domestically mobile student base and rising international student numbers.
Wider housing market shortages and growing demand for rental accommodation are also contributing to the growth in PBSA demand. With an undersupply of modern, high quality PBSA beds, favourable demand-supply dynamics are supportive of rental growth.
At the same time, lower volatility of returns means the sector offers investors strong risk-adjusted returns.
Still in its infancy, the sector offers a scalable investment opportunity. Back of the envelope calculations suggest the size of the institutional market could triple from around EUR45 billion to over EUR155 billion.
There is also significant scope for increased liquidity. Despite having four-times as many students as the UK, average annual investment in European PBSA is only a little over half that of the UK.
A lack of existing supply implies a significant funding opportunity, while a fragmented operator landscape and recent correction in pricing provides an attractive entry point for acquisition and/or consolidation opportunities to scale up.
The sector is increasingly catching the eye of investors. In INREV’s 2025 Investor Intentions survey 67% of investors reported a preference for investing in European PBSA, well above the five-year average (35%) and up from 45% in INREV’s 2024 survey.
With strong demand-supply fundamentals and countercyclical characteristics, Europe’s PBSA sector represents a strong asset class, offering investors an attractive, scalable opportunity.