Spain is consolidating as the most attractive European market for investment in student residences (PBSA, by its English acronym), according to the report released this Thursday by Savills and The Class Foundation, which highlights that the south of the continent reaches its greatest historical weight in this segment.
With 15% of the surveyed investors and operators placing Spain as their preferred market, the country moves ahead of Italy and the United Kingdom, both with 13%, according to the "European Purpose-Built Student Accommodation Investment Barometer 2026". The study, prepared by Savills and The Class Foundation, is based on responses from 19 investors and operators that manage more than 107,000 beds in Europe, with assets valued at around 18.1 billion euros.
The respondents also anticipate a 93% increase in the number of beds in their PBSA portfolios in Europe over the next two to five years, which would mean adding roughly 99,200 new places and mobilizing an additional 15.8 billion euros in investment.
The analysis notes that Southern Europe already concentrates 27% of European investment in student residences, its largest share to date. Along with the leadership of Spain and Italy, 8% of the participants identifies Portugal as the preferred destination for this type of asset.
"These markets still have very low student residence coverage rates, while they are also seeing an increase in the number of international students—a combination that increases pressure on the existing supply and reinforces the need to develop new product," the authors explain in a statement.
Regarding the 13% preference for the United Kingdom, which in 2025 occupied sixth position, the document attributes this "renewed interest" to investors that have already created platforms of significant size in continental Europe and that now are assessing entering the British market for the first time.
Germany, with 11%, and France, with 8%, complete the group of five destinations with the greatest appeal. Both are among Europe’s largest university systems and have experienced annual increases of more than 3% in the number of international students over the last five years.
"Although they have coverage rates higher than those of some markets in Southern Europe, a significant portion of their publicly owned accommodation stock needs modernization, which opens up opportunities to develop residences specifically designed for students—modern, sustainable, and adapted to their new needs," the firms say.
"Growing relevance" of artificial intelligence
On the one hand, Savills expects that European PBSA will continue to be an attractive destination for international capital, although the source of this could vary. It recalls that North America concentrated close to two-fifths of cross-border investment between 2021 and 2025, while in the latest edition of the barometer, 63% of participants predict an increase in capital coming from Asia-Pacific.
The report also highlights the "growing relevance" of artificial intelligence (AI) as one of the main drivers of change for the sector, both in the way students search for and book accommodation and, in the medium term, in operational models, practices, and the margins of investors and operators.
On the other hand, The Class Foundation calls for closer cooperation between investors, operators, universities, and public administrations to reconcile the profitability of projects with affordability for students.
"A stable and predictable regulatory framework can provide more confidence to capital, while public-private collaboration can help unlock land and develop an offer aligned with sustainability standards and students' needs," they conclude.