Dorm no longer the norm. Student housing in non-metros gets upscale
Smaller cities are now stepping up to provide co-living spaces to students. They offer comfortable rooms, WiFi, cafeterias, food courts and recreational activities.Updated: Sep 08, 2019 12:57 IST
For students, shifting to a new city to study, hunting for a safe home near campus, and dealing with budgeting, housekeeping and commuting can be nothing short of an odyssey — especially in non-metro cities that have less infrastructure to help them settle in.
Student housing start-ups are beginning to make that process as simple as checking into a hotel. They’re developing lodgings similar to those now available in the prime metros: shared rooms pre-fitted with air-conditioners, co-living projects with entertainment zones, in-house laundry services, 24x7 food courts, social events and biometric security.
One advantage in the smaller cities is that there is room to grow and experiment. Land costs are lower too, and yields are higher.
“There are substantial investments being made in newer educational destinations such as Dehradun, Manipal, Indore and Kota, to name a few,” says Samantak Das, chief and head of research and REIS, JLL India. “Student housing and organised co-living will increase at a faster pace in the next three to five years, though it will not replace PG and unorganised student housing. Both will co-exist.”
Private student housing developments can only cater to certain income categories, for instance. But within that segment — which is a large chunk of the 36 million Indian students out there — demand is high.
“Returns are actually three to four times as much as traditional rents in the same area,” Das says. “And there is a lot of latent demand, so in the next three to five years, this realty segment is likely to grow quite fast.”
Stanza Living, for instance, already has student housing projects in ten cities, offering between 75 and 500 beds per project. As with most developers in this space, the offerings are student hostels taken over and entirely rehauled.
All rooms are fully furnished; there are study spaces, common areas and entertainment zones. A chef plans daily meals, there’s housekeeping and laundry services, wifi, biometric access, a CCTV network and guards around the clock.
“On average, 10 million students migrate domestically for higher education every year, and are in need of housing. Most educational institutes are only able to accommodate 15% to 30% of their students in their own residence facilities, with a majority dependent on private housing arrangements. Currently, 55% of our residence-base comprises students migrating from and within non-metro cities,” says Anindya Dutta, co-founder and MD of Stanza.
At Oxfordcaps, present across eight metro and non-metro cities (Delhi, Bengaluru, Dehradun, Pune, Greater Noida, Indore, Jaipur and Ahmedabad), students have access to custom-designed spaces, the usual housekeeping and recreational infrastructure, and even a range of meal plans. “We also host array of events and activities focused on career development,” says CEO Annu Talreja.
Ayushi Chauhan, a first-year student at Jaipur’s International Institute of Hotel Management, had never lived away from home before and says living in an Oxfordcaps addresses most of the concerns about safety and convenience. “I see my college friends living in PGs. I’m in a better environment,” she says. “We can have a friend over for the day. My college is four kilometres away, and the hostel van drops and picks me up.”
Rahul Sharma, a second-year BCA student at the University of Petroleum and Energy Studies in Dehradun and a resident of Stanza’s Koh Samui House in Dehradun, says when Stanza took over, their hostel got water filters on every floor, a TV in the lounge, sandwich-makers, washing machines and vending machines. “They listen and take action on feedback and complaints,” he adds.
Stanza’s Pattaya House in Dehradun has a swimming pool. Sharma’s hostel has a gym and students get access to both. They also have a bus and cab service to and from the campus, about 6 km away.
A NEW ASSET CLASS
Anuj Puri, chairman of Anarock Property Consultants, says student housing helps more than just students. “For developers, it provides a fresh avenue of diversifying from the currently tepid Indian residential market. For investors, it is an emerging asset class with high potential for returns.”
Challenges lie ahead before the returns roll in. “The costs of construction and land in bigger cities are high,” Puri says. “Private equity investments into student housing were as minimal as Rs 6 crore in the last two years. There are no specific tax rebates for student housing ventures to attract developers. And universities are reluctant to collaborate with student housing operators.”
First Published: Sep 07, 2019 20:20 IST