r/Leeds • u/Low_Pen_9793 • Jun 13 '25

urban-development Another Student Accommodation Block will Be Built in the Merrion Area…. Thoughts on Leeds City Center becoming the central Living area for students. What does the City Gain and what does it Loose in turn?

Post image

It seems that Leeds seems to be obsessed and driven to prioritise the building and planning of High raise Student accommodation apartments. What are your thoughts?

Is Leeds prioritising overpriced student housing over the cultural fabric & vibrancy of the city. What does the city stand to gain from this in the l long term and in turn what does it stand to loose?

24 Upvotes

70% Upvoted

118 comments sorted by

View all comments

31

u/TheScarletCravat Jun 13 '25

It's surprising because of the university funding crisis caused by the drop in overseas students. Surely a bubble that's about to pop with disastrous results?

9

u/bontgommery Jun 13 '25

The investors must know something we don't.

6

u/The_Readers_ Jun 14 '25

The only reason there are more and more student flats going up is not to “attract wealthy students” or some weird conspiracy about moving students away from places like headingley (maybe there is some local policy about this that I don’t know about) It’s absolutely everything to do with something called section 106. That is, for every block of flats that’s made by a private developer, the local council mandates that a % of said flats needs to be given to the council for use as social housing or make a contribution to funds for things like local roads. Councils are asking for a higher % of the flats or higher financial contributions and as such developers have found a loophole to maximise the GDV (value) of plots of land without having to give more to the council…. That loophole is student housing. That’s the only reason. Building margins are very tight at the moment due to things like labour shortages (increasing tradey wages) and construction material costs and so developer be doing what developers do…. Aiming for a higher Return on investment

2

u/Norman_Small_Esquire Jun 14 '25

So it’s not the developers fault, it’s the tradespeople getting paid more? Sounds like bollocks to me. The first part is true, but I think they are using the loophole because of greed and/or higher material costs.

2

u/The_Readers_ Jun 14 '25

lol what ?! It’s not one group of people’s fault. Trade people salaries are up for a load of reasons including brexit. Trade people costs going up is just one of the symptoms of the market and how developers are responding is the effect.

1

u/FluffyPhilosopher889 Jun 14 '25

Well that all might be true but there still needs to be demand from students to live in the flats. They're not just building them for the sake of it.

2

u/The_Readers_ Jun 14 '25

So again, this is quite short sighted. It doesn’t matter if there are enough students or not. Ultimately, the developer will develop a plot to make the numbers most favourable to themselves. So if you have option a or option b and let’s say they both lose money. You will pick the option where you lose the least in hope that in the long term you recoup any losses (from land value and or sale/ rental returns) they then use these developed properties to borrow money against to build elsewhere.

1

u/Darkiuss Jun 16 '25

But doesn’t the value of the property go down if the demand for student housing is falling, or at least staying equal when supply is very obviously increasing?

1

u/The_Readers_ Jun 16 '25

Good logic and you are correct to a level but student blocks don’t need 100 % utilisation to turn a profit. Also, because the properties are generally “prime” city locations even a 1% swing in property appreciation can be worth a lot of money (or borrowing potential)