In a mixed picture for Scottish property investment, student accommodation performed strongly and drove growth year on year for alternative asset classes north of the border.During 2015, investment in more conventional areas such as commercial property fell steeply, by 11% from 2014’s investment total, to around £2.1 billion. A hangover from the Independence Referendum, one eye on the EU Referendum and an upheaval in Scottish politics generally have all be apportioned part of the blame for the slump. This is bad news when compared to figures from the UK as a whole, where investment in commercial property rose overall.
However, there were pockets of positive news in amongst the figures. Foreign investment in Scotland continues to rise, both in commercial property and alternative assets such as hotels, student accommodation and health facilities. The Scotsman reported that ‘Overseas investors were instrumental to the record year. Inflows from foreign buyers rose by 9 per cent and accounted for a record 50 per cent share of total UK volume. North America was the dominant buyer, making up 46 per cent of overseas investment.’
American funds and investors have been targeting UK and Scottish markets in recent years, with an influx of investment on student accommodation developments free project planning software.
In 2014 a report by a leading property group put Scotland top of the table for the best place to invest in student housing. Investors clearly took that prediction seriously, and the chance to enjoy large yields has drawn investors from all over the world to the Scottish student housing market. Aberdeen and Glasgow in particular have seen booms and continue to experience growth in thestudent accommodation market, ranking them up there with UK cities such as Manchester, Liverpool and Brighton as excellent places to invest.
Uncertainty around tenancy legislation and the political situation regarding the EU are definitely threats to Scottish investment and growth, but student housing so far has proven resilient to external dangers and continues to act as a driver for alternative asset classes in the Scottish market.
Whether external factors and global market shocks will weigh down and slow investment in student housing in 2016 remains to be seen, but the signs suggest it will still be a market targeted and considered safe by investors throughout the year.