With construction and finance costs constraining viability, investors are giving greater consideration to refurbishment-led strategies in the living sector. Acquiring well-located existing assets can create opportunities to improve the student experience, strengthen operational performance and capture rental growth. Crucially, refurbished schemes may still offer rents below those needed to support new development, widening the addressable demand pool. The PBSA planning pipeline continues to expand. At the end of June 2026, around 103,000 beds across Russell Group cities had detailed permission or applications submitted, up from approximately 88,000 in early 2024. Yet a larger pipeline does not necessarily translate into more construction.

Unite estimates that new schemes outside London now require a weekly rent of £230 to be viable. This exceeds prevailing average PBSA rents in more than three-quarters of UK student cities, restricting the locations where new schemes can progress.

Rising construction and finance costs are making many schemes harder to deliver. Against this backdrop, existing stock offers a growing opportunity. Across Russell Group cities, almost three-fifths of PBSA was built before 2015, with a further 30% completed between 2015 and 2020. Many assets are therefore reaching the point at which targeted investment could materially improve their competitiveness. The strongest opportunities are likely to be well-located buildings in markets with robust underlying demand, but where the resident offer, specification or operational performance has fallen behind newer competitors. Refurbishment can help close this gap, capture rental reversion and improve returns. In many cases, rents can remain below new-build levels after works, supporting affordability and access to a deeper pool of students.

The characteristics that create the opportunity can also introduce delivery risk. Older buildings may contain hidden defects, outdated services and more complex regulatory requirements. Investors should test physical, operational and statutory constraints alongside rental and capital-value upside from the outset. Technical due diligence should cover the structure, façade, roof, building fabric, and mechanical and electrical services.

It should also identify potential liabilities including asbestos, damp, fire-compartmentation deficiencies and incomplete health and safety information. These findings should inform the programme, cost plan and contingency. If identified too late, material defects can quickly erode the returns that supported the case for refurbishment. The strategy should also consider operational carbon, energy efficiency and thermal performance. Older assets may have oversized communal areas, redundant space or inefficient layouts. Subject to building constraints, reconfiguration may create additional lettable rooms and increase net operating income and capital value within the existing envelope. Extension or increased density may also be possible.

Any increase in occupancy must be tested against planning, means of escape, compartmentation, accessibility, amenity provision and building-services capacity. Where an asset falls within the higher-risk building regime, the Building Safety Act 2022 and the Building Safety Regulator are central considerations. Gateway 2 approval is required before construction can begin, so programmes should allow for coordinated design and complete fire and structural safety information.

_{Read the articles within Savills Build: Perspective report below}