Unite reaffirms 2025 earnings guidance amid resilient UK student housing demand

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1. https://www.investing.com/news/stock-market-news/the-unite-group-reiterates-fullyear-eps-guidance-on-rental-growth-of-4-4276274 - Please view link - unable to able to access data
2. https://www.investing.com/news/stock-market-news/the-unite-group-reiterates-fullyear-eps-guidance-on-rental-growth-of-4-4276274 - The Unite Group PLC has reaffirmed its full-year adjusted earnings per share (EPS) guidance of 47.5p-48.25p, supported by a 4% rental growth for the 2025-26 academic year. As of 30 September 2025, 95.2% of beds for the upcoming academic year were reserved, slightly down from 97.5% at the same point last year. The company also reported stable valuations for its portfolios and progress on its acquisition of Empiric Student Property plc. The Unite UK Student Accommodation Fund (USAF) portfolio was valued at £2,853 million, unchanged on a like-for-like basis for the quarter and up 1.4% for the year to date. The London Student Accommodation Joint Venture (LSAV) portfolio was valued at £2.11 billion, up 0.4% on a like-for-like basis for the quarter and 1.9% for the year to date. The company expects the acquisition of Empiric to become effective by the second quarter of 2026, subject to conditions set out in the scheme document.
3. https://www.investing.com/news/stock-market-news/unite-students-maintains-2025-eps-outlook-sees-4-5-rental-growth-4125730 - Unite Students has reaffirmed its adjusted EPS guidance for FY2025 at 47.5-48.25p and maintained its rental growth forecast of 4-5%, according to its Q2 trading update. The company reported that 85% of beds for the 2025/26 academic year have been sold, down from 94% at the same point last year. It still targets 97–98% occupancy. Nomination agreements from universities account for 56% of total beds, compared to 57% last year. Unite attributed the lower figures to a later sales cycle, aligned with pre-pandemic trends, and said demand remains strong, with U.K. 18-year-old university applications up 2% and total applications up 29% year-on-year through May. Rental growth helped drive modest valuation gains across the company’s two major property funds. The Unite U.K. Student Accommodation Fund (USAF) portfolio was valued at £2.94 billion as of June 30, reflecting a 0.6% like-for-like increase. Rental income grew 1.3% during the quarter, with yields unchanged at 5.2%. The USAF portfolio includes 24,326 beds across 61 properties in 19 cities. The London Student Accommodation Joint Venture (LSAV) portfolio rose 0.7% in value to £2.09 billion, with 0.6% quarterly rental growth and stable yields at 4.5%. LSAV comprises 9,710 beds in 14 properties across London and Birmingham. USAF recently refinanced £395 million in bonds maturing in 2025 with a new £400 million eight-year secured loan from Rothesay Life, priced at a 5.6% interest rate. Unite said the transaction was factored into its EPS guidance, which assumes a 4.1% weighted average cost of debt for 2025. On development, Unite secured planning for a 2,000-bed scheme with Newcastle University, with delivery of the first phase expected in 2028/29. A joint planning application with Manchester Metropolitan University for 2,300 beds was submitted in May, with entry into that venture expected by end-2025. Four additional planning applications are under review by the Building Safety Regulator. Policy updates pose mixed signals. The May Immigration White Paper proposed reducing the post-study visa period from 24 to 18 months and introducing a levy on international student income. Unite said it does not expect these changes to materially affect demand. Further details are expected in the Autumn Budget. Meanwhile, the Renters’ Rights Bill, expected to become law this year, will exempt purpose-built student accommodation (PBSA) from new housing rules if it complies with approved codes of practice. This exemption would likely apply from the 2026/27 academic year. Unite expects the bill to increase costs for students in the shared housing (HMO) sector and reduce its supply, which could benefit PBSA operators over time. The company said its outlook remains positive, supported by strong application trends and growing university partnerships.
4. https://www.investing.com/news/stock-market-news/unite-group-shares-climb-on-strong-earnings-and-positive-outlook-3888226 - Shares of Unite Group climbed more than 2% following its earnings report, which reaffirmed strong rental growth and a solid financial outlook. Analysts at Morgan Stanley noted that the student accommodation provider delivered "another set of strong results," with market rent increasing by 9% in 2024 and a total NAV-based return reaching 10%. The company reported a net asset value (NAV) per share of 972 pence, a 6% increase year over year. While this figure came slightly below Morgan Stanley’s estimate of 978 pence, it still placed the stock at a 12% discount relative to its NAV. Investors reacted positively to the news, particularly as Unite announced a final dividend of 24.9 pence per share, bringing the total payout for the year to 37.3 pence—an increase of 5% from the previous year. Unite’s portfolio valuation saw a 5% like-for-like increase, in line with expectations, as robust rental growth helped counteract a minor expansion in yields. The company’s reported portfolio yield stood at 5.1% at the end of 2024. Operationally, Unite continues to demonstrate resilience, with occupancy levels remaining high at 98% for the 2024/25 academic year and rental growth projections maintained at 4-5% for 2025/26. For the 2025/26 academic year, the company has secured 70% occupancy of its student accommodations, a metric they interpret as a return to typical demand levels after a particularly robust previous year. They also confirmed their 2025 EPS forecast, projecting a 2% to 4% increase, resulting in 47.5 to 48.3 pence, which is slightly above market expectations. Morgan Stanley remains optimistic about Unite’s prospects, maintaining an "overweight" rating on the stock.
5. https://www.investing.com/news/stock-market-news/unite-group-makes-offer-for-empiric-student-property-amid-7-rental-growth-93CH-4190782 - Empiric Student Property plc reported a 3.3% increase in revenue to £43.8 million for the six months ended June 30, 2025, alongside the announcement of a firm and recommended takeover offer from The Unite Group PLC. The student accommodation provider achieved 7% like-for-like rental growth during the period, while EPRA earnings rose 5.1% to £14.3 million. On a per-share basis, EPRA earnings declined slightly to 2.2 pence from 2.3 pence a year earlier, which the company attributed to a temporary effect from its equity raise in late 2024 and an anticipated weakening in operating margin. The company’s portfolio valuation increased to £1.16 billion, reflecting a 0.8% net like-for-like increase, while EPRA net tangible assets per share rose 0.5% to 120.2 pence. Empiric declared dividends of 1.85 pence per share for the first half, up 5.7% from the same period in 2024, and reconfirmed its minimum dividend target of 3.7 pence for the full year. The company reported that its eligible re-booker rate for the 2025/26 academic year exceeds 60%, with current occupancy at 77%. Empiric expects to achieve 97% or better occupancy for the upcoming academic year, despite what it described as a "normalised" sales cycle. During the period, Empiric completed two acquisitions in Manchester and Birmingham using proceeds from its October 2024 capital raise. The company also continued its postgraduate accommodation conversion program, with three properties on track to open in September and a fourth due in early 2026. Empiric maintained a loan-to-value ratio of 30%, below its long-term target of 35%, with cash and undrawn committed facilities of £73.4 million. The company has no refinancing requirements until 2028 and reported a weighted average cost of debt of 4.5%. The takeover offer from Unite Group was announced separately on August 14, according to the press release statement.
6. https://www.investing.com/news/stock-market-news/morgan-stanley-sees-uk-student-housing-boom-as-bright-spot-in-europe-4218079 - Morgan Stanley has identified student housing as one of the most resilient areas of Europe’s property sector, naming Unite Group as its new top pick. The brokerage noted that demand for student accommodation in the United Kingdom is set to strengthen as tighter immigration rules in the United States, Canada, and Australia push more international students toward British universities. According to UCAS data, undergraduate acceptances for the 2025/26 academic year are up 3% compared with last year, with non-EU international students rising 5%. These trends, combined with limited new supply, are expected to sustain rental growth above 4% for longer, compared with the 3-4% modeled by consensus. Unite has guided to like-for-like rental growth of 4-5% and occupancy above 97%. Despite these fundamentals, Unite’s shares have underperformed, closing at 709p on Aug. 28, near decade lows and significantly below Morgan Stanley’s price target of 1,000p. The brokerage said the derating reflected slower booking progress this summer, though it attributes that mainly to students delaying reservations after some operators offered late-cycle discounts in the prior year. Unite’s financials underline the resilience of the sector. The company reported net asset value per share of 972p in 2024, with Morgan Stanley estimating 1,034p for 2025 and 1,226p by 2027. Earnings per share are forecast to rise from 46.6p in 2024 to 52.5p in 2027, while dividends are projected to climb from 37.3p to 41.9p over the same period. Leverage remains moderate, with net debt to EBITDA expected at 6.7x in 2025 and an EPRA loan-to-value ratio of 26%.