Unite Students has pulled the plug on its planned 605-bed PBSA scheme in Paddington and deferred delivery of a student scheme in Bristol.
The Group’s £147million Paddington scheme had finally been granted planning permission by the London Mayor’s office, despite being rejected twice by Westminster City Council. Unite said that the scheme was no longer financially viable.
The decision to walk away from the Paddington project will see the developer write off £10million in planning costs.
Unite said that its decision to delay the 500-bed Freestone Island scheme in Bristol will allow it to explore options to secure “best value” from the development. The decision will free up around £55million of capital that had been earmarked for construction.
In its trading update for the past year, Unite’s chief executive, Joe Lister, said that, despite a slower start to the next sales cycle, the business was still on track to meet its expectations.
Lister said: “Sales progress to date is consistent with our guidance for occupancy of 93–96% and rental growth of 2–3% for the 2026/27 academic year.”
“Our conversations with our university partners show continued demand for our high-quality, value-for-money accommodation, notwithstanding a slower start to the 2026/27 sales cycle.”
Unite also announced the introduction of a £100million share buyback, which would be funded initially through a reduction in off-campus development.
The trading update said that the Group would continue to invest where risk-adjusted returns were acceptable, which would lead to further surplus capital as planned asset disposals continue.
The developer said that its revised strategy reflects a wider slowdown in the supply of purpose-build student accommodation, which Unite says is a result of regulatory drag and more challenging scheme economics.
Unite says that minimum rents of around £230 per week are required to make new schemes viable, while delivery programmes were facing delays of up to 12 months due to Building Safety Act gateways.
Looking forward, the PBSA specialist said that it would focus on capital discipline and operational performance, which would deliver a return to earnings growth from 2027 onwards.