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By Steve Umidha
Student Factory Africa, a consortium of architects, last week announced its entry into the Kenyan market – in partnership with a Dutch-based private equity firm to launch a hostel project in the local market.
The brand’s entry into the Kenyan market highlights the growing demand for such housing concepts among investors, funders and developers keen to fill the existing gap.
Student Housing, or purpose-built student accommodation (PBSA), refers to housing that has been designed specifically to meet the demands and requirements of the modern-day student.
The concept has gained much traction globally and has become a mainstream investment class asset gaining more attention from institutional investors especially in developed European markets and the United States, driven by the huge student enrolment numbers and a failure on the institutions’ part to provide accommodation that is commensurate with the increase in student enrolment populations.
The venture’s 4,500-bed student accommodation will cost Sh5 billion and will be located in Karen, next to Catholic University of Africa. The hostels will be primarily for students from Catholic University.
Expected to break ground in April and the first phase to be finished in 12 months, this will be the country’s second branded hostel after Acorn Group’s Qwetu, which launched in 2017.
Student Factory Chief Executive Chris Osore said universities have highlighted the need for formalized student accommodation.
“These institutions have been asking for it. And it is just that investors have not been able to tap into that market,” said Mr Osore last Friday when the firm signed an agreement with Betonbouw B, a private equity firm that will provide close to a third of the financing for the project.
Student factory plans to put up an estimated 4,800 of such housing units in 18months which will be fitted with Wi-Fi, housekeeping and laundry services, app-enabled living in an air-conditioned environment as well as fresh and wholesome meals.
The cost per student per month will range between USD $100 and $180, according to Paul Karuma, Managing Director Tracom Services Limited.
Kenya’s lacklustre response to student housing stands in sharp contrast to trends in countries like the UK, US and Australia, where it is an evolved and profitable real estate segment.