While the university-led development of the city is transformative, encouraging young people at university to continue living centrally once they move into work is a big opportunity for any university city. Belfast has the challenge of enticing home-grown graduates to return once they have completed studies in Great Britain. 36% of Northern Irish students who studied in Great Britain are working in Northern Ireland six months after graduation, with net student migration estimated to be in the region of -14,000 each year.
While current financial conditions are forcing more graduates to live with parents7, for those graduating from university and wanting to stay in Belfast city centre, there is a fundamental challenge of there being no obvious supply of accommodation.
A typical market response in other cities has been to deliver more build-to-rent, which has not yet happened in Belfast. These aim to improve the overall quality of the rental stock while offering amenities that are free to use (e.g., gym, co-working space, spaces to hire for gatherings), that improve the experience of the occupant and provide them with flexibility to relocate easily. Build-to-rent schemes appear to suit casual renters such as young professionals. While there are proposals in process, such as City Quays 4, no build-to-rent developments have broken ground to date.
Build-to-rent projects are an excellent source of evidence for markets to analyse and share with institutional investors. Like purpose-built student accommodation in Belfast, the expectation is that once the concept is proved, the markets for demand and supply will develop.
There has been some progress on smaller scale residential developments throughout 2022, with two new projects breaking ground. The schemes which started construction are Coyle’s Place, a 38-home development located beside the existing Portland 88 building (completed in 2019), and 20 College Square North, a 48-home social housing development. Other projects which fall below our scale threshold (25 homes) have also progressed, including Wilton House (23 homes) and a site on McClure Street (22 homes).
Despite these green shoots, Belfast Crane Survey data over the last six years has found been a persistent lack of residential developments. Belfast’s difficulty in getting larger schemes off of the ground stands out, with other Deloitte Crane Surveys highlighting residential development as the predominant sector in other cities such as Leeds, Manchester and Birmingham over the same period. While each city is different, there is undoubtedly a deficit in city centre residential stock in Belfast as a result of both historic and contemporary factors.