With India’s changing demography tilted toward the young, student relocation, in the country, which currently stands at approximately 11 million, is expected to touch 31 million by 2036 according to a report released by property consultancy Colliers on Wednesday.
However, only 7.5 million student beds exist across on-campus accommodations pan-India while off-campus offerings continue to be dominated by unorganised players. The clear demand-supply gap presents immense opportunity for organised real estate players to tap into this segment.
The organised players currently occupy a sub 1 per cent market share with roughly 1.25 lakh beds, as opposed to 1.3 crore outstation students relying on off-campus accommodation, pointed out Venayak Gupta, chief revenue officer of co-living and student housing provider your-space.
“Pre-pandemic, many start-ups ventured into the purpose-built student accommodation sector, and very few have survived to become seasoned players with large portfolios across the country,” noted Swapnil Anil, executive director and head of advisory services at Colliers India.
Others agreed.
“No one has been able to figure out the unit economics in this segment,” reasoned Dr Nikhil Sikri, co-founder and chief executive of co-living major Zolostays, which forayed into the segment for on-campus accommodation this academic season starting June 2023. The biggest value proposition in this play is brought by the landlord who leaves little room for profits, he explained.
“We're on our way to becoming a mature market in 5-6 years,” Gupta projected.
Student housing rentals post-pandemic have seen a steady 10-15 per cent year-on-year rise, the report highlighted. With a continued growth in rentals, Gupta does not see any respite in sight for students and professionals going forward.