Unite Group flags lower 2026 earnings on weak student housing demand, shares slump (updated)
27/11/2025 08:28
Corrects November 27 story to say Unite is grappling with slower growth, not a fall, in rental income in paragraph 1 and that it reported a drop in number of late-cycle Chinese postgraduate tenants, not overall number of students in paragraph 3 Nov 27 (Reuters) - Britain's Unite Group UTG.L warned of lower earnings in 2026 on Thursday, as the student accommodation developer grapples with lower student occupancy and slower rental income growth, sending its shares to a more than a decade low. Separately, the UK's competition authority cleared Unite Group's 634 million pound ($839.48 million) acquisition of smaller rival Empiric Student Property ESP.L. The deal comes as the sector faces headwinds, with both companies reporting a drop in the number of late-cycle Chinese post-graduate tenants seeking accommodation amid geopolitical uncertainty and rising costs. Unite Group, in a separate statement ahead of its investor event, said it expects a 7-10% drop in its 2026 adjusted earnings per share, as it grapples with lower student occupancy, a fall in rental income, and delays in development completions, among other factors. Earlier this month, Empiric reported a 6% decline in occupancy, citing a fall in reservations from Chinese student tenants. Unite said on Thursday that it expects to deliver rental growth of 2%-3% for the 2026/27 academic year, below the 4% reported for the 2025/26 academic year. The Bristol, England-based company also expects to report muted growth in occupancy for the 2026/27 academic year at 93-96%, compared to the 95.2% in the 2025/26 academic year. Shares in the company dropped 6% in early trade to their lowest levels since early 2015. ($1 = 0.7552 pounds) (Reporting by Simone Lobo in Bengaluru; Editing by Rashmi Aich) ((Simone.Lobo@thomsonreuters.com, +919920570373))