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Empiric Student Property Plc, a UK-based student accommodation operator, has reported a decline in occupancy to 89% for the ongoing academic year, compared with 95% a year ago, and expects to miss its 97% target. The drop is mainly due to fewer Chinese student tenants, slower booking activity, and supply-demand imbalances in certain regional cities. UK students now make up 43% of the total occupancy. The company, currently being acquired by Unite Group Plc, still expects rental growth of around 4.5% this year.
Empiric Student Property Plc, which owns and manages purpose-built student accommodation across the UK, has said that its occupancy for the 2025/26 academic year has dropped to about 89%. This figure is lower than the 95% achieved last year and below the company's target of 97%. The company attributed the fall mainly to a decline in Chinese student tenants, geopolitical factors affecting overseas enrolments, and a slower booking pace since the start of the new academic cycle. Advertisement
Empiric mentioned that some cities, including Nottingham, Sheffield, and Glasgow, have been impacted by localised supply-demand imbalances, resulting in an estimated five percentage point drop in occupancy in those regions. However, the company highlighted that domestic students now represent about 43% of total tenants, reflecting steady demand from the UK market. Empiric continues to forecast like-for-like rental growth of roughly 4.5% for the current academic year.
The student housing developer, listed on the London Stock Exchange under the ticker ESP.L, operates under the 'Hello Student' brand and manages around 8,000 beds across major UK university towns. The business is in the process of being acquired by Unite Group Plc, one of the country's largest student accommodation providers. The acquisition deal values Empiric at approximately GBP 710 million, with shareholders set to receive 0.085 Unite shares plus 32 pence in cash per Empiric share. Including a special dividend, the total transaction is valued at about GBP 723 million.
The proposed merger is currently being reviewed by the UK Competition and Markets Authority (CMA). Unite Group has expressed confidence in completing the deal, noting that its assessment had already factored in lower occupancy and rental growth levels. The company believes it can improve Empiric's performance over the next three years through its operational systems, scale advantages, and existing university partnerships.
Empiric's latest occupancy performance contrasts with the strong results it achieved in previous years. In the 2023/24 academic cycle, the company had reported record revenue occupancy of around 99% and like-for-like rental growth exceeding 10%. The latest decline highlights the broader shift in the UK student housing market, where a reduced intake of international students particularly from China is beginning to influence occupancy trends. Analysts have noted that changing visa rules and geopolitical tensions have affected the mobility of overseas students, especially from key markets such as China.
Despite these challenges, the company remains optimistic about maintaining stable rental growth and believes domestic student demand will help offset part of the decline in international bookings. Empiric stated that it will continue to monitor reservation trends and adjust its marketing approach in affected regions to stabilise occupancy levels in the months ahead.
Source Reuters
5th Jun, 2025
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