Why TAL GP Projects Invests into Purpose-Built Student Accommodation (PBSA): Robust Fundamentals and Resilience
- natasha10928
- Oct 15
- 3 min read
Purpose-built student accommodation (PBSA) is supported by strong underlying fundamentals. Australia's consistently high global university rankings in recent years, its geographic proximity to Asian countries, and favourable exchange rates, have all contributed to a prompt post-pandemic recovery for the sector. The outlook remains positive, underpinned by an undersupply in stock, growth in student enrolments, and the sector’s counter-cyclical characteristics.
A Story of Undersupply and Rental Growth
The Australian student accommodation market has experienced below-average development completions over the past two years, resulting in a scarcity of supply within the sector. As of the end of 2024, the international higher education student-to-bed ratio across Australia stands at 4.0, with New South Wales significantly exceeding the national average at 5.8. A recent report, CBRE The Living Imperative August 2025, estimates that there is a current shortfall of 180,000 PBSA beds across the nation.
Conversely, demand continues to rise. In 2024, international enrolments across Australia reached approximately 500,000, nearly double the levels recorded a decade ago. Limited stock, combined with high levels of international student migration, underscores the market’s undersupplied condition.
These market dynamics have driven strong rental growth across the sector. Since 2018, average rental increases for single studio apartments have reached 50% in Sydney and 38% in Melbourne.
The sector is, however, shaped by an evolving policy landscape. Notable examples include the government’s failed proposal to cap foreign student enrolments at 270,000 toward the end of 2024, the introduction of a new Ministerial Direction in December 2024, and the addition of 25,000 student enrolments announced in August 2025.
Despite the dynamic policy backdrop, investor confidence remains strong. For instance, in May 2025, CBRE Investment Management committed in Scape’s $6 billion open-ended core fund, joining existing heavyweight investors such as Dutch firms APG and Bouwinvest, South Korea’s National Pension Service, Canadian pension investor CDPQ, and UBS Asset Management.
TAL GP Projects’ Role in Delivering PBSA Projects
In the PBSA sector, our pipeline consists of eight secured opportunities across Perth, Adelaide, Sydney and Melbourne, totalling just over 2,500 beds, whilst continuing to analyse new opportunities with a strong appetite to add further projects to the portfolio. Leveraging our hallmark approach to modern design and functional excellence, each of our development projects is tailored to user requirements with efficient layouts, while responding sensitively to the site context through integrated design solutions.
Our acquisition strategy focuses on tapping into undersupplied catchments, characterised by high volumes of international students, such as areas in proximity to The University of Sydney/ University of Technology Sydney, University of New South Wales, and The University of Melbourne/ Royal Melbourne Institute of Technology. The Accommodating the growth in students report released by CBRE in August 2025 estimates that there is an approximate shortfall of 10k beds in the Melbourne City/Inner North Melbourne submarket and an approximate shortfall of 25k beds in the Central/Inner-west Sydney submarket.
TAL GP Projects’ Strategic Capabilities: Research, Analytics, and Risk Management
We deliver a comprehensive, end-to-end development approach supported by deep expertise across the property value chain to develop PBSA assets yielding long-term value.
Our site acquisition strategy is informed by data-driven analytics and evidence-based methodologies to identify high-potential opportunities. We work closely with stakeholders, such as operators, capital partners, local agents, and consultants, to co-develop briefs that reflect evolving market needs. Throughout development, a rigorous risk management framework is leveraged, with extensive due diligence conducted prior to key milestones, for example site surveying and town planning. This disciplined approach mitigates risk and ensures optimal project outcomes.
Our team’s cross-disciplinary backgrounds, including construction, valuations, architecture, and urban planning, enable a holistic approach to development. Unlike traditional developers, TAL GP Projects embraces a partnership-focused model, balancing commercial outcomes with the needs of operators and end-users. Operator input is integrated from the earliest stages of site identification and continues through design and delivery, ensuring projects are both commercially viable and fit-for-purpose.
Agility in a Dynamic Market: TAL GP Projects’ Adaptive Operating Model
TAL GP Projects’ agile operating model enables the business to respond swiftly to emerging market trends and shifting dynamics in the PBSA sector. Through continuous engagement with operators and stakeholders, we are able to anticipate evolving requirements and make informed decisions throughout the development lifecycle.
This adaptability empowers us to adjust site selection criteria, refine design features, and recalibrate project strategies in real time, ensuring relevance and alignment with market demand. Our hands-on, collaborative culture fosters rapid execution without compromising on quality or long-term vision. This positions TAL GP Projects as a proactive and trusted partner in the fast-moving PBSA sector.
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