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UK student housing provider Unite sees lower profit on reduced occupancy

By Reuters

– UK’s Unite Group Plc forecast annual earnings to be at the lower end of its expectations, as the student housing provider struggles from reduced occupancy and rental income due to the COVID-19 pandemic, sending its shares down more than 4%.

The company, which provides homes to students in university towns and cities including Leeds and Manchester, said it expects earnings per share for the year ending Dec. 31, 2021 at the lower end of its outlook of 27-30 pence.

Unite also said the impact from lower rents in the second and third terms of the 2021/22 academic year would reduce rental income for 2022 fiscal year by 8 million pounds ($10.87 million) to 10 million pounds, compared with the management’s previous expectations. The UK’s academic year runs from September to June.

The company added that 94% of bed spaces are now let across total portfolio, slightly below management’s expectations for 95%-98% occupancy for the current academic year as pandemic-related international travel restrictions continue to hurt demand from China.

However, Unite said a strong outlook for student demand remained and projected rental growth of 2.3% for the 2021/22 academic year.

($1 = 0.7358 pounds)