Planning matters

The publication of the Draft London Plan marks an important moment for London's purpose-built student accommodation (PBSA) sector. Interestingly, one of the biggest changes isn't the introduction of a new policy - it's the removal of one.

For years, PBSA has benefited from its own dedicated policy within the London Plan. In the draft Plan, that standalone status has disappeared.

Instead, PBSA now sits alongside co-living, specialist housing, supported accommodation and older persons' housing within the new draft Policy HN5: Managing Specialist Accommodation.

At first glance, this might appear to downgrade the sector. However, it may signal the opposite.

Rather than treating PBSA as a niche product requiring its own bespoke policy, the GLA increasingly appears to recognise it as an established component of London's housing supply and economic infrastructure. For a sector that historically had to justify its role in London, especially in the early years of the London Plan 2021, this may represent a significant shift in thinking.

The consolidation of specialist housing into a single policy inevitably creates a longer and more complex policy. However, it also reflects the fact that PBSA is no longer viewed as an exception.

In practice PBSA has become part of London's wider housing solution - reducing pressure on conventional housing stock, supporting affordable homes and helping deliver economic growth. The Draft London Plan appears to recognise this more explicitly than the current London Plan.

Although the structure of PBSA policy has changed, the fundamentals remain largely unchanged.

PBSA developments are still expected to:

• be located in accessible, well-connected locations;
• contribute towards affordable housing in accordance with Policy HN3;
• support mixed and inclusive neighbourhoods; and
• secure affordable student accommodation through nomination agreements where appropriate.

Importantly, PBSA continues to contribute towards borough housing delivery, with 2.5 student bedspaces counting as one home for monitoring purposes. That recognition of student accommodation as part of London's housing supply remains firmly embedded within the Plan.

 

 

Perhaps the most significant policy shift in the draft London Plan is the move from simply looking to manage applications for student accommodation to actively planning for PBSA.

Draft Policy HN5 now requires boroughs to meet student accommodation needs and identify opportunities to support delivery. Alongside this, the Draft London Plan introduces:

• a London-wide target of approximately 31,500 PBSA bedspaces between 2027 and 2037; and
• individual borough level targets, with Barnet, Brent, Croydon, Ealing, Greenwich, Hillingdon, Newham, Southwark, Tower Hamlets and Wandsworth the ten boroughs earmarked for the highest levels of PBSA delivery.

This represents a notable departure from the 2021 London Plan, which deliberately avoided borough-specific student housing targets.

The evidence underpinning the approach to need, the Student Accommodation Need: Analysis and Review of Evidence (July 2026), concludes that London's demand for PBSA will remain strong throughout the Plan period, driven by affordability pressures and international student demand. Importantly, the GLA has adopted a cautious growth assumption, recognising the challenges experienced in parts of the UK where oversupply has emerged following changes in student demand.

The borough targets have been derived using housing growth forecasts, accessibility to higher education institutions and the availability of suitable development locations, including Opportunity Areas, town centres and Green Belt station catchments.

Overall, this should encourage boroughs to take a more positive and proactive approach towards student housing.

However, targets can cut both ways.

Once boroughs consider their target to have been met, there is a risk that they begin resisting further proposals, even where market demand remains. Likewise, the suggestion that boroughs should allocate specific PBSA sites could reduce flexibility if plans are unable to respond quickly to changing market conditions.

As we highlighted in our previous PBSA Insight, Unlocking London’s Student Housing Potential successful plan-making depends upon retaining sufficient flexibility to accommodate future shifts in demand. Broad ‘residential’ allocations allowing for PBSA (and other living sector uses) in Local Plans are surely preferable to inhibitive PBSA-specific allocations.

 

Whilst the Draft Plan is broadly supportive of PBSA, it places considerably greater emphasis on where schemes should be located.

The GLA now states that PBSA should generally be located within around 30 minutes' travel time - whether by walking, cycling or public transport - of a university campus, while also benefiting from good access to services and public transport.

The Draft Plan also introduces a greater focus on concentration.

Under Policy HN5, boroughs are encouraged to consider whether clusters of student accommodation are beginning to undermine mixed and inclusive communities. Where evidence of over-concentration exists, local planning policies may be justified to remedy this.

Supporting paragraph 3.72 reinforces that it is for applicants to demonstrate that schemes are appropriately located, designed and managed so that they contribute positively to neighbourhoods, while recognising that local planning authorities may identify spatially specific considerations through their Local Plans.

This balancing exercise, supporting delivery whilst avoiding over-concentration, is likely to become one of the key planning debates for PBSA over the coming years.

 

One of the most welcome changes is a shift in the approach to affordable housing policy.

The current London Plan merely promotes on site Affordable Student Accommodation (ASA) for PBSA schemes. ASA is defined as a bedroom with an annual rental cost at or below 55% of the maximum government maintenance loan for a student living away from home in London. Existing policy requires 35% ASA in qualifying PBSA schemes to follow the fast track route.

In our previous Insight, we identified three emerging models for delivering affordable housing within PBSA schemes. It is encouraging to see the Draft London Plan now proposing these as the three affordable housing options for PBSA.

Under draft Policy HN3: Delivering Affordable Housing new PBSA schemes would be able to provide affordable housing through:

1. on-site affordable student accommodation;
2. a combination of affordable student rooms (up to 10% below the policy threshold) alongside a payment-in-lieu towards conventional affordable housing; or
3. conventional affordable housing.

The relevant thresholds are set out table 3.2 of the policy and now vary from borough to borough and are dependent on specific circumstances. The relevant thresholds and circumstances, as well as further details on the affordable housing policy can be found in our blog, Affordable Housing Under the Draft London Plan: Progress or Further Complexity?

This shift introduces far more flexibility than the current policy, which favours affordable student accommodation secured through Nomination Agreements.

Indeed, Nomination Agreements are now only required for the affordable PBSA element itself. Under the new policy a scheme delivering 100% affordable student accommodation would not require one.

Helpfully, for Option 2 (combined ASA and PiL), the draft Plan also introduces a methodology for calculating the payment-in-lieu contribution. Until now, our own research identified that approaches have varied considerably between boroughs, with no strategic policy framework in place.

One issue we note with the current drafting, however, is that these affordable housing options appear to be framed solely around the Fast Track Route, with no reference to the viability-tested route set out in Part K of the policy. This is likely to require clarification as the Draft London Plan progresses.

Notwithstanding this, for schemes facing viability challenges, or for operators whose preferred affordable housing model differs from traditional nomination-based accommodation, the additional flexibility provides genuine choice and could improve deliverability while continuing to support wider affordable housing objectives.

 

The Draft London Plan also proposes changes to the accessibility requirements for PBSA developments.

Currently, PBSA schemes are generally expected to provide either:

• 10% wheelchair-accessible bedspaces; or
• 15% accessible bedspaces.

The draft policy instead proposes:

• 4% wheelchair-accessible bedrooms;
• 1% wheelchair-accessible bedrooms with tracked hoists and adjoining companion rooms; and
• 5% easily adaptable bedrooms.

These revised standards reflect the evidence contained within the supporting Student Accommodation Need evidence and represent a more targeted approach to accessibility provision.

 

Although not PBSA-specific, the Draft Plan also recognises the role that phasing can play in improving scheme viability.

The supporting text under policy MBUL1 Spatial Strategy, acknowledges that, for PBSA and purpose-built shared living developments, deferring affordable housing requirements from early phases may help establish scheme value and improve deliverability.

Questions remain as to how this approach would operate in practice and how local planning authorities would secure the delivery of the affordable housing. While this approach is likely to benefit larger multi phased projects more than standalone PBSA schemes, it nevertheless demonstrates an increased awareness of development viability which is welcomed.

Taken together, the Draft London Plan sends a clear message. The GLA increasingly views PBSA as more than an alternative investment asset. It is now recognised as an important component of London's housing needs and economic infrastructure.

We think the overall direction of travel is positive. Well-located, well-managed schemes that contribute appropriately towards affordable housing should continue to receive strategic support.

Rather than questioning whether PBSA should be delivered, the focus is increasingly shifting towards how much, where, and how it contributes to London's wider housing and growth ambitions.

This is a positive change. However, with viability pressures and wider market challenges continuing to affect the PBSA sector, we question whether the Draft London Plan provides sufficient flexibility and incentives to unlock the scale of delivery it envisages.