Foreign capital fueling rise in student dorms in Spain
MALAGA, Spain — While learning how to develop video games, David Leon Serrano, 21, has been enjoying a fairly novel experience for a Spaniard: living in student accommodations on the southern coast of Spain, a five-hour drive from his home in Madrid.
Studying away from home is a familiar experience in many parts of the world, but a relatively new phenomenon in southern Europe. In Spain, only about 17% of students get their higher education outside their home region, according to the Spanish government. In the United States, residents account for less than 20% of the student population in most states.
“I think that young people now are starting to understand that if we at least move around our own country, it is good for our development,” Leon Serrano said, “not only in terms of finding the best place to study what we want, but also in terms of gaining independence and becoming a more complete person.”
His studio apartment, which includes a kitchenette and a bathroom, costs close to $800 a month, paid for by his parents. The Malaga residency is among 13 such student housing facilities run by Livensa Living, which is partly owned by Brookfield Asset Management in Toronto.
The rising mobility of Spain’s student population is fueling a surge in investments in student dorms, largely funded by foreign capital. Investors are also tracking the growing appeal of Spain among foreign students wishing to study there.
The sunshine and outdoor lifestyle of Spain have helped make it the top choice for students taking part in Erasmus+, the European Union’s university exchange program. Spain has also increasingly begun to attract Latin American students, especially those whose mother tongue is Spanish, and it is a popular choice for participants in U.S. study-abroad programs.
Life on campus was mothballed for much of 2020 by the pandemic, but students have returned in high numbers, particularly eager to enjoy the community lifestyle that they missed while much of the world was on lockdown. Real estate investors have followed suit.
In Malaga, the number of student housing beds rose almost 50% over the past year, according to a study published in September by JLL, a real estate services company. Underlining the rebound, new investments in the sector reached $160 million in the first half of 2021, up 140% from a year earlier.
Spanish lawmakers are also making it easier for developers to obtain construction licenses for dorms, not only to help students but also to free up housing for other residents in their crowded cities.
Spain has about 1.6 million students in its universities. There are about 100,000 beds in student dorms, a shortfall of about 450,000 beds needed, according to JLL. Even as the pace of housing construction picks up, the gap is expected to grow over the next decade, because the number of students in need of housing is likely to rise even faster.