Hello Medway Investors,
I was interested to read an article just over a week ago that announced the closure of the University for the Creative Arts (UCA) campus in Rochester in September 2023.
In addition to this, the university has said that it will be stepping back as a further education provider in order to focus on undergraduate, postgraduate, and research degrees.
It is my understanding that financial pressure as well as estimated £18m costs to carry out repairs are the main reasons for the decision. According to their website, the UCA has several campuses including UCA Canterbury, UCA Epsom, UCA Farnham, UCA Rochester, Maidstone TV Studios or the Royal School of Needlework, so it seems to be that a decision was made that they think it will be more profitable to focus on these other campuses.
Alongside working professional tenants, Medway’s student population is one of the big draws for HMO investors so I wanted to share my thoughts on what this could mean for the Medway HMO market.
The campus has over 150 staff, around 1,000 students, and was built in the 1970s.
Given how the creative arts industry has suffered over the past year, I do also wonder how much COVID-19 has impacted this decision and whether there has been a marked downturn in applications. This seems likely due to the fact that a large proportion of the students studying at UCA Rochester were international travel students. An article I read, for example, commented that there has been an estimated 16% fall in international students due to COVID-19 equating to around 170,000.
There is public outcry about the closure; even to the point where there is a change.org petition that requires 2,500 signatures for the matter to be debated by the local council. It will be interesting to see how many signatures this receives as at the time of writing, it has received over 1,800.
MPs have also written an open letter objecting to the closure; however, I really do fail to see how the closure could be prevented without additional funding being made available.
So, the question on my mind is what will happen with the building. I’m not sure what you think, but it is quite likely that, given Rochester’s future potential as demonstrated by developments such as Rochester Riverside and others, that the building will either be sold on for redevelopment into apartments or purchased by Medway Council and redeveloped as we have seen with the plans for the Pentagon shopping centre in Chatham to be developed into Mountbatten House.
In terms of the HMO market, I don’t think that there will be too much of an impact thankfully. It is extremely challenging to calculate the exact number of students living within the Medway area, however, it will certainly be significantly more than the 1,000 attending the UCA as Medway has three other main universities situated within its boundaries (Canterbury Christ Church University, University of Kent and University of Greenwich).
As the country hopefully continues to adjust to more of a normal way of life, it will certainly be interesting to see how and if this will impact the way universities deliver lectures and whether this will have any effect on where students base themselves. I personally don’t think that there will be all that much change, however, it is something to watch; particularly for landlords relying on a student tenant demographic!
I’d be keen to hear your thoughts on this announcement and in particular, what you feel could be done with the site. As the Medway Towns continue to be developed, it could be a great development opportunity and is certainly one to watch!