A Market Driven by Unwavering Demand
The numbers paint a clear picture. In 2024 alone, university and TVET enrollment surged, fueled by increased government funding through HELB loans, which grew by a massive 59.5% to KES 46.9 billion. Yet, only about 10% of Nairobi's over 240,000 students are accommodated on campus. This creates a colossal, evergreen demand for safe, modern, and well-located housing. Unlike other real estate sectors that can be swayed by economic downturns, the demand for education—and therefore student housing—remains remarkably stable.
The Financials of PBSA: A Compelling Case
- **Superior Rental Yields:** Purpose-built student housing in prime areas near universities, such as Karen and Thome, has demonstrated rental yields as high as 11.1%, significantly surpassing the average residential yield of 5.8% in the Nairobi Metropolitan Area.
- **High Occupancy Rates:** With a constant influx of students each year, well-managed PBSA facilities boast consistently high occupancy rates, often exceeding 80-90%, providing a predictable and steady cash flow.
- **Recession-Proof Nature:** Education is a non-discretionary expense for many families. This ensures that even during economic slowdowns, the demand for student accommodation remains robust, making it a defensive and resilient asset class.
"Investing in student housing is more than just real estate; it’s investing in the infrastructure of Kenya’s future workforce. The social impact is profound, and the financial returns are equally compelling."