Expanding into Hong Kong’s Student Housing Investment Sector

2024-06-01

Centaline Investment plans to invest in approximately 2,000 student dormitory beds in Hong Kong over the next two to three years. This investment targets the new policy of the Hong Kong government to increase the subsidised UGC-funded quota for non-local students, anticipating a substantial rise in accommodation demand. With the local property market adjusting downwards, Centaline believes this is an opportune time to introduce the plan. Since 2016, Centaline has invested in student housing in the US and the UK, providing substantial returns for investors and hopes to bring this successful overseas experience to Hong Kong. Currently, Centaline has negotiated with several landlords, aiming to implement the plan in the short term.

By the 2027/28 academic year, the number of non-local students is expected to reach 67,800. After accounting for on-campus dormitory quotas, about 50,000 students will need off-campus accommodation. Referencing the infiltration rates in the US and UK, the value of the local student housing market could reach HKD 45.8 billion within five years. Investing in student housing provides stable returns and effectively diversifies risk. Centaline’s investment strategy includes purchasing target properties, refurbishing them, and renting them out as student apartments. Before acquiring a property, market fundamentals, geographical location, student population, and project potential will be considered. Partnerships with other investment institutions are welcomed to initiate this new project.

If you are interested in more details, please email info@centacbi.com or call (852) 2533 3848 to contact our investment advisor .

The Founder of Centaline Group, Shih Wing Ching, highlighted that the shortage of student dormitory beds in Hong Kong, combined with the government’s recent increase in the cap for non-local student admissions to 40% in subsidized higher education institutions, has created a significant demand. In response, Centaline Investment is actively seeking suitable projects to leverage their successful experience in overseas student housing investments.

The Chairlady of Centaline Subsidiaries, Janet Shih, noted that the current property market in Hong Kong is not promising, and advised investors to diversify their portfolios. Investing in real estate funds can help spread risks and reduce the hassle of property management.

The CEO of Centaline Investment, Kavis Yip, stated that the company has student housing projects in both the US and the UK. She highlighted that projects in Texas and Georgia have achieved considerable returns. Yip attributed this success to rigorous property analysis and careful site selection, ensuring the properties have renovation potential and are located near universities.

Josephine Kong, Managing Director of Centaline Investment, noted that the government’s plan to increase the UGC-funded quota for non-local students to 40% will result in about 67,800 non-local students by 2027/28, with around 50,000 needing to rent accommodation. She highlighted that if Hong Kong’s student housing market reaches a similar infiltration rate to the UK and US, its market value could reach HKD 45.8 billion.

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