Student accommodation sector on the ‘brink of significant evolution’

The rise of ‘flex’ strategies has the PBSA sector on the ‘brink of...
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The rise of ‘flex’ strategies has the PBSA sector on the ‘brink of significant evolution’, says provider AXO Student Living.

 

The accommodation provider believes ‘flexible living’ will be a key industry trend in 2024, with operators seamlessly blending long-term contracts with short-term leases. AXO Student Living first adopted a hybrid rental strategy during the height of COVID, in a bid to fill some of its inventory that would usually be occupied by international students. By partnering with property management platform Lavanda, and gaining permission from local authorities, it was able to convert a variety of its buildings into ‘pop-up hotels’, offering travellers short-stay options to boost occupancy rates and overall NOI. By changing its operations, AXO Student Living was able to generate £20,000 a month at its property in Oxford Circus, London, which would otherwise have remained empty.

 

This gave AXO Student Living a ‘glimpse of the future’ and, as soon as normality resumed, the provider continued investing in its flex strategy during the summer months to fill vacant units when students weren’t there. Lavanda takes care of the empty stock, promoting the apartments on popular OTAs such as Airbnb and Booking.com and managing pricing strategies. Lavanda’s property management software (PMS) also enables AXO Student Living to achieve fast turnarounds with its housekeeping, which enables operators to see the clean/dirty status of every unit in their property, automatically generate cleaning tasks precisely when they are needed and track each one through to completion.

 

Thomas Bush, Sales and Marketing Director at AXO Student Living, comments:

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“The pandemic posed considerable challenges in maintaining occupancy and filling rooms that were traditionally occupied by international students. We recognised we had to adapt to the difficult situation we were in, so diversifying our revenue streams at that point was an absolute necessity in order to make it through a turbulent time.

“It opened our eyes to how we could be flexing our approach during gaps in tenancies every summer. This is a major trend within the PBSA sector, which now seems to be on the brink of a significant evolution in terms of how assets are used year-round. It’s given us a glimpse of the future, and we suspect more operators will start to explore flex options in 2024 as they realise the increased NOI potential of not simply relying on one type of resident.”

 

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Fred Lerche-Lerchenborg, CEO at Lavanda, added:

“Adaptability was vital for those businesses weathering the economic storm during COVID. AXO Student Living spotted an opportunity to diversify and make use of some of its empty properties, and now this flexing of residential assets is something that is slowly becoming the norm within PBSA. 

“By offering short, medium and long-term stays, PBSAs can add to the financial strength of these buildings, turning them into all-weather assets, with broad appeal to different audiences at different times of the year.”

 

About AXO Student Living

AXO Student Living is an accommodation provider which is committed to providing students from around the world with much more than just a room. The company aims to give its residents a unique living experience which will enhance their academic journey and ensure their time at university is packed full of great experiences and amazing friendships whilst they enjoy wonderful secure living spaces. AXO Student Living also offers flexible tenancies in convenient locations to accommodate different needs. For more information visit https://axostudent.co.uk/

 

About Lavanda

Founded in 2015, Lavanda is an award-winning flexible rental platform helping residential real estate businesses better connect with their customers and stay one step ahead. Lavanda technology enables its users to open up their residential portfolios to the full spectrum of rental demand and deliver incredible customer experiences at scale. 

Clients include industry leaders Blackstone, Greystar, Brookfield and Starwood Capital amongst many others. For more information visit www.getlavanda.com.

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