Student Coliving to attract $700M investment In India by 2023
As per the latest report named “The Herald of a New Chapter – Student Accommodation in India” by global realty consultant firm CBRE and the Student Accommodation Provider Association of India (SAPFI), the student coliving segment is witnessing a rapid growth across all the major markets in the country and is expected to witness a growth of 36 percent between 2019 to 2023. The Student Accommodation Provider Association of India (SAPFI) is an organization of student accommodation providers, managers, and related service providers.
Student enrolment in the country has increased from 32.3 million in 2013-14 to 36.64 million in 2017-18, only 1 hostel bed is available to 6 students enrolled for higher education.
Major Highlight of The Report
- Student enrolment in the country has increased from 32.3 million in 2013-14 to 36.64 million in 2017-18, only 1 hostel bed is available to 6 students enrolled for higher education.
- Tapping this gap, the top 30 players in student housing/co-living space offer a cumulative stock of more than 250,000 beds; stock to witness a CAGR of 36% between 2019-2023.
- More than USD 700 million have been committed as investments in the student housing/co-living sector by players such as Warburg Pincus, Sequoia Capital, Goldman Sachs, HDFC amongst others.
- Going forward, systemization of the student accommodation industry expected; govt. support critical to ensure the sector achieves its growth potential.
- New operation models to emerge, a targeted approach by operators is critical to ensure product acceptability.
- Affordability, safety and flexibility to remain key to success; being located in mixed-use developments can help cater to the live, work, play generation.
- The student housing or co-living space is expected to witness an investment worth $700 million, and an addition of 0.6 million beds by 2023 across the country,”
- Additionally, there are numerous Tier II markets with a significant student population. Tapping the gap in the segment, the top players in student housing or co-living space offered a cumulative stock of more than 2,50,000 beds as of August 2019.
- Also, as the number of female students constitutes more than 47 percent of the total student enrolments in India, it is imperative that student coliving & housing accomodations tick the boxes on safety, security, and service, the report said
- “The government is targeting a gross enrolment ratio (GER) of 30 percent by 2020-21, which will result in a further increase in the number of students enrolled for higher education,” the report said.
Increased mobility among students and a growing number of private higher education institutions has led to the emergence of new educational hubs in the country. So the bigger and better business opportunities are evolving in the students coliving and shared living space sector in India.
Larger states such as Uttar Pradesh, Gujarat, Maharashtra, Karnataka, Rajasthan, Madhya Pradesh, Tamil Nadu, and Andhra Pradesh account for a major share in colleges across the country. Consequently, cities such as Bengaluru, Jaipur, Hyderabad, Pune, Nagpur, and Mumbai housing prominent educational institutions have emerged as educational hubs
Some challenges faced by the student accommodation industry in India is maintaining the affordability quotient, as the rental housing market in India remains unorganized and opaque, quality and trust issues are the top challenges that both landlords and tenants face, to tackle all these sorts of problem the emergence of co-living startups may solve the problem of student accommodations and shared living spaces in India.
By looking at the above highlights of the co-living space industry sector, it is a great business opportunity for the Indian startups to grab this opportunity and to provide better students and shared living accommodations to the end-users.
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