THE UK-headquartered Global Student Accommodation (GSA) has acquired five properties in Dublin from its joint venture partner Harrison Street in a deal worth €400m.
GSA provides student housing in eight countries around the world.
The properties are made up of 1,971 beds, primarily serving students at Trinity College, the Royal College of Surgeons, TU Dublin Grangegorman and UCD. They include Ardcairn House, Kavanagh Court, New Mill, The Tannery and Broadstone Hall.
Average rents range from €240 per week for a shared flat to €350 for a studio. The portfolio has an average occupancy rate of 97pc. The group said it would continue to partner with Chicago-headquartered Harrison Street across Ireland and other European markets, including engaging in a separate joint venture in Dublin and Cork consisting of around 1,300 beds.
Assistant professor Orla Hegarty, a housing expert from UCD's School of Architecture, Planning and Environmental Policy, said the yield for this type of specialist accommodation was particularly attractive as rents in Dublin were "very high".
She said: "Developers' gross income is up to €10,000 for nine months on the single- occupancy en-suite rooms from students, where the prices range €200 to €260 a week and students have to take the contract for 40 weeks.
"Then they have three months of tourists when they can earn up to double the rent from students."
This niche accommodation was a strategy from the Department of Education to try to increase available high-quality space for predominantly international students, she said.
"It has allowed the third-level colleges to grow their international intake, who pay higher fees, so it has been a strategy that has been successful for the education sector and it has brought income into it," Ms Hegarty added.
However, she warned it was done without consideration of how it would as to how it would impact upon the rest of the property and land market. "If you are looking more broadly at the housing crisis, it has diverted a lot of development investment and construction capacity to prioritise international students over people here in a housing crisis," she said.
The recent increase in high-end student accommodation, alongside the growth of the private rental sector and co-living, has 'exploded' land values: "Standard residential apartment building just isn't happening in Dublin; it's high-rent, build-to-rent, student accommodation, co-living and hotels."
Whether the market for expensive student accommodation continues to grow remains to be seen.
"Anecdotally, people are saying that the market for premium-rate student housing may now be saturated - that there is vacancy," the UCD housing expert said.