According to GSA's Xavier Scheibli, who manages the German portfolio, there is a culture change where more German students are joining and coming to its assets.

International Investor GSA Tackles Diversity of German Housing Submarkets: Tech-Driven Cities Attract New Students, while Older Cities Create Opportunity

January 19, 2024

SHURE Initiative

The number of post-secondary students in Germany has increased by roughly one million in the last 20 years, and the country is one of the most sought-after for international enrollment. As such, International PBSA investor GSA focuses on the range of activities impacting mature and immature submarkets in Germany.

Despite this increase in the student population, there are significant differences in the university cities across Germany. A SHURE Initiative session in Zurich recently covered the DACH region of Europe (DACH is the business acronym for Deutschland, Austria, and Switzerland) or essentially the German-speaking European countries.

Indeed, the German market opportunity is very diverse, from more mature markets such as Munich, increasing due to its AI industry, to markets in the Eastern region with outdated housing stock dating back to the Cold War era.


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“Every time they come to us, the students want to stay with us because they like our products, so we need to do more in Germany,” said Xavier Scheibli, German Portfolio Director of GSA. “But you must go to every country to find the local developers, especially in Germany. They can help you build your product.”

GSA entered the German market in 2016 and currently maintains five properties.

GSA’s Urbanum in Frankfurt’s Gallus District contains 268 single-studio apartments (268 beds). Amenities include bicycle storage, parking, a gym, a study area, a lounge, and rooftop terraces.

According to Statista, there were 2.92 million students enrolled in universities across Germany in the winter of 2022/2023. Two decades earlier, in the winter of 2002/2003, approximately 1.94 million students were enrolled. In other words, enrollment in Germany increased by approximately 50% over the last 20 years.

The post-secondary system in Germany dates back to 1386 with the founding of Heidelberg University. The University of Hagan is the largest by-enrollment university in Germany, with 86,889 students.

Top 5 universities by enrollment in Germany:
1) University of Hagen – 86,889
2) University of Munich – 51,025
3) University of Cologne – 48,962
4) Goethe University Frankfurt – 46,961
5) RWTH Aachen University – 44,517

Like many countries with growing student populations and a lack of new housing delivery since the pandemic, Germany now faces a housing affordability crisis, which is hitting its student population particularly hard.

“Germany is the largest economy in Europe,” noted Scheibli. “If you want to invest in Europe and PBSA, you must be in Germany. There are many students, not only in the big five to seven cities but also in what I would call secondary cities.”

There are 25 cities in Germany with more than 40,000 students, and the provision rate in the cities is very low.

However, the development timeline, especially the complexity of building permits, is a barrier to entry in Germany. The cost of building permits is a very capital-intensive part of the development process in Germany and one of the highest among the Eurozone countries.

Xavier Scheibli, Portfolio Director – Germany, GSA

“If you want to build a building, that is, let’s say, cost of $40 million to $50 million, you need to put $3-4 million aside to get to your building permits, and you never know if you will have the right thing,” said Scheibli. “Permitting in Germany is a very capital-intensive part of the development cycle.”

GSA is an international student housing investor/operator with assets in Australia, China, Japan, Dubai, Germany, Spain, the UK, Ireland, and the US. GSA operates several divisions within its organization, including the DOT Group, the website student.com, the management firm Yugo, and a debt fund dedicated to PBSA financing and PBSA development financing.

Scheibli concludes his remarks with optimism for continued growth in the German market. ” You have the potential to deploy capital in a really liquid market – there is plenty to do.”

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