Written by: Claire Halliday, Editor of Build-it’s sister publication EducationDaily.
When Federal Treasurer Jim Chalmers presented the Federal Budget 2024-2025, he outlined the proposed cap on international students by saying: “We will limit how many international students can be enrolled by each university based on a formula, including how much housing they build”.
Scape is the largest owner, developer and operator of purpose-built student accommodation (PBSA) in Australia, and says it is committed to working collaboratively with all levels of government and the education sector to ensure all students have access to high-quality accommodation options.
Scape PBSA co-founder, Craig Carracher, acknowledges the release of the Australian Government’s Draft International Education and Skills Strategic Framework, highlighting its importance as a policy lever for the sector.
Scape is particularly encouraged by the draft Framework’s emphasis on:
• Maintaining a high-quality education system. This aligns with Scape’s commitment to providing students with a safe, secure, and well-equipped living environment that complements their educational experience.
• Sustainable growth. Scape recognises the importance of managing student numbers for long-term success. Purpose-built student accommodation plays a vital role in addressing infrastructure pressures and ensuring a positive experience for international students.
• Focus on skills development. Scape supports efforts to align education with Australia’s skills needs. A highly skilled and thriving international student population will benefit the education sector, as well as the broader Australian economy in the short-term and long-term.
“While the Framework represents a significant step forward, ongoing collaboration is crucial to ensure its success,” Mr Carracher says.
“It took a global pandemic for the immense value of international students and the PBSA sector to our economy to be understood and recognised. Recent NAB research confirmed their critical contribution, with international students supporting *50 per cent of 2023 GDP growth. But poor decision-making at state and local level has dissuaded investment in the sector since the pandemic as the industry tried to get back onto its knees just months after the lockdown while student accommodation buildings were still largely empty.
“This inconsistency with state decisions, like Victoria imposing penalty surcharge taxes that discriminate against the development of purpose-built student accommodation (PBSA), Brisbane rate levies that single out student accommodation providers for increased rate hikes and New South Wales that introduced co-living planning regimes and failed to consider the PBSA sector needs cause confusion. A nuanced approach is required, and we are encouraged that this Federal Government has convened a National Cabinet to address the issue and to commence the conversation wrapped around the quality and sustainability of our international education strategy.”
Mr Carracher says “we know the importance of international education as our third-largest export and our top non-extractive industry having felt its loss back in 2020”.
“A strong international education sector not only underpins Australia’s education system for domestic students but also strengthens our global standing. Importantly, National Cabinet has come together to acknowledge the important role of international students which we hope will encourage our State Governments to remove impediments and inconsistent tax treatment to support the essential investment into the social infrastructure that underpins our education sector.”
Inconsistencies must be addressed
Anouk Darling is CEO at Scape and says “we commend the Federal Government’s commitment to understanding the sector’s nuances, however, inconsistencies at the state level create uncertainty for investors”.
“For instance, Victoria grants exemptions to Build-to-Rent projects while imposing taxes to PBSA that discourage investment. This creates a mixed message that is not conducive to a vital PBSA sector.”
“Preparedness over predictions, we’re here to continue to work with the higher education sector to deliver their accommodation needs whether it be existing availability in our portfolio or future growth,” Ms Darling says.
She told EducationDaily that universities are in the business of education and “Scape is in the business of world-class living – from capital raising, development to operational experience and resident well-being”.
“Affordability, expertise, and the significant investment required for large-scale development remain key challenges for universities,” Ms Darling says.
Whilst universities can unlock land, Ms Darling points to the new Metro in Sydney and Victoria’s Big Build that she says have opened up further opportunities.
“However, the real challenge is in zoning and planning process with local government inconsistencies,” she told EducationDaily.
“Nationally, our university precincts are typically located within the CBDs of our capital cities, where land is tightly held and often without the appropriate zoning to facilitate the delivery of PBSA. In order for the private sector to support Universities with well-located PBSA, we need support from local and state government to review the zoning controls that will facilitate this both on and off campus.”
Rezoning will unlock accommodation options
Just as NSW recently finalised the accelerated Transit Oriented Development precincts across major growth nodes in Sydney, Ms Darling says “we should also be looking at an expedited rezoning process around our key universities to ‘unlock’ the delivery of student housing”.
Guidelines around what type of accommodation must be suitable for international student housing provide important parameters that must be adhered to, she says, to ensure quality accommodation is provided.
Ms Darling says key criteria for high-quality student housing should include:
- Strategic Location – “Our developments are strategically located near campuses and public transportation hubs, ensuring easy access to educational institutions and local amenities. International students don’t use personal vehicles.”
- Leading Safety Standards – “We prioritise our resident safety through comprehensive security measures, creating a secure environment for all students, including CCTV, access control systems and on-site security.”
- Inclusive Design Philosophy – “Our design philosophy promotes cultural inclusivity through thoughtfully curated colour palettes, furniture choices and joinery, beautiful and practical social spaces that foster a sense of belonging, understanding how homesickness can be crippling for a younger resident.”
- Sustainable Living – “Our green star ratings, fully electric built environments (ie no gas) and biophilic design reflect the values of our residents as well as Scape’s, contributing to a considered future. “
- Smart Technology Integration – “We go beyond simply offering high-speed Wi-Fi! Smart building technology enhances the resident experience by promoting efficiency, safety, and a seamless living environment to support them doing the best work of their educational career.”
Not an overnight solution
PBSA developments can take up to six years in the planning phase due to roadblocks with local planning and zoning, says Ms Darling, adding that, “post-DA, it’s only an 18-month construction period”.
With Australia facing a skills shortage in the building industry, Ms Darling says simply finding available construction workers can be problematic.
“This is a significant challenge, and the limited labour pool and can impact timelines and costs – particularly for Scape, who will not allow this to impact quality standards,” she told EducationDaily.
Ms Darling says Scape Student Living welcomes National Cabinet engagement on international education and calls on state governments to remove disincentives and red tape to support the focus on quality and sustainable growth in Australia’s international education strategy.
“Serious consideration to our skilled migration programs, attracting qualified tradespeople from overseas and streamlining the visa processing and incentivisation could greatly assist here. There are some cities, like Brisbane, where there simply isn’t the workforce to meet the demands of ongoing a
