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10 August 2018

Demand for higher education in Australia by Chinese students is strengthening despite rising education standards in competing markets, such as Canada.

While the quality of Australia’s education plays a substantial role in attracting international students, the lifestyle, safety, language, employment opportunities and climate are also cited as reasons to study in the country.

A recent report by Knight Frank shows that as of April 2018, Chinese enrolments in Australia stood at 124,000, which is Australia’s largest cohort of all international students.  Annual growth over the same period last year was up 17%, while there has been 40% growth since 2016 and 77% growth since 2014.  Projecting the trend at a conservative 5% per annum, Knight Frank predicts that Chinese enrolments will reach 193,500 by 2027, an additional 68,800 students.

However, based on past growth and a greater emphasis on international student recruitment, it is more realistic that the trend will grow at a rate closer to 10% per annum. Therefore, Chinese enrolments in Australia would be closer to 294,000 by 2027 – an increase of almost 170,000 enrolments from today.

The international student population provide a strong customer demand group for purpose-built student accommodation. This very positive demand metric underpins part of the strength of the Australian PBSA investment market, which will see a total of 8,290 student beds become operational in 2018. Sydney, Melbourne, Brisbane and Adelaide have attracted 80% of the new supply, while the remaining 20% has been delivered across Hobart, Geelong, Wollongong, Cairns and Perth.

GSA Coral continues to see the positive impact of this unprecedented student enrolment growth in terms of real tenant demand for operational assets. The fund’s investments currently include 2,127 beds across five assets. University Square (Melbourne) opened recently and is seeing strong current and subsequent academic year demand. Early marketing indications from Infinity Place (Melbourne) and The Boulevard (Perth) which are to open in 2019 are showing similarly strong student demand.

The maturing and growing Australian market is a key area for the current and future investment strategy of GSA Coral and we are pleased to share this encouraging demand information.


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