Investment in the UK’s purpose-built student accommodation (PBSA) sector hit £2.1bn during Q1 in a "capital-strong" start to the year, according to Knight Frank.

The agency said this marked the strongest start to a calendar year for the sector in more than a decade, driven by Unite Group’s £723m acquisition of Empiric Student Property, which added 68 assets with around 7,700 beds across 22 cities to its platform.

Knight Frank also revealed that 65% of deals – 13 out of the 20 in the quarter – were for operational assets.

Four land transactions represented 20% of Q1 activity, while three joint venture deals made up the remaining 15%. Five of the Q1 deals transacted at prices above £150m.

Based on analysis of the UK’s operational PBSA stock, schemes under construction and prevailing weighted average rents, the UK’s professionally managed student accommodation market was valued at £84.8bn as of April 2026, Knight Frank said.

In November, the firm revealed investors had committed around £50bn into the UK’s PBSA sector over the course of a decade, accounting for 33% of all global PBSA investment since 2019.

Merelina Sykes, joint head of student property at Knight Frank, said: “While the opening quarter was capital heavy, it was not deal heavy. A total of 20 transactions were completed, broadly consistent with long‑term norms, indicating that activity was driven by a number of capital‑intensive transactions rather than a broader expansion in deal flow.

“The fundamentals underpinning the UK PBSA sector remain exceptionally strong. As we move through 2026, we expect investment to remain selective but competitive, with well-located operational assets and scalable platforms commanding the greatest interest as investors prioritise income security and long‑term growth.”

Katie O’Neill, associate in the global living sectors research team at Knight Frank, added: “The tilt towards a preference by investors for existing assets is expected to continue in 2026, with investor demand concentrated on mid‑market and lower‑entry pricing points, particularly assets offering embedded rental reversion while retaining alignment with affordable market thresholds.”