WBC LPF is a private real estate fund platform focusing on dormitory and co-living assets. It transforms residential properties into assets with stable cash flow through acquisition, renovation, and professional operation and management.
While Hong Kong’s office and retail leasing markets are still struggling through a cyclical downturn, one once-marginal property niche is drawing a flood of global capital: student accommodation.
"In recent months, we’ve seen a significant uptick in clients exploring student housing investments in Hong Kong. Previously, it was mostly foreign funds and local investors. Now, Chinese institutions, large listed companies, and even Southeast Asian funds are also taking a close look," said Stephen Yun, Executive Director and Head of Capital Markets at CBRE Hong Kong, in an interview with National Business Daily. "We’re still fielding enquiries from clients about student housing. The momentum is clearly building."
Behind this growing interest is a deliberate push by the Hong Kong SAR government to promote the "Study in Hong Kong" brand, with the goal of positioning the city as a regional higher education hub. Investors, in turn, are betting on the steady inflow of international and mainland Chinese students coming to Hong Kong for their education.
In the first half of 2025, as part of the government’s "Study in Hong Kong" push, the Education Bureau announced that the non-local student quota for the city’s eight publicly funded universities would be raised from 20% to 40% starting in the 2024/25 academic year. That cap was further increased to 50% in September of the same year.
The result was a marked acceleration in capital deployment throughout 2025.
According to data released by Midland Commercial & Industrial in November 2025, a total of 16 transactions involving hotels, guesthouses, or entire residential buildings being converted into student accommodation were recorded between January and October of that year, with a combined value exceeding HK$6.1 billion. Hotels accounted for the bulk of these conversions, with six deals totalling HK$4 billion.
A partial tally by our reporters shows that, on the local front, in late July 2025, Wang On Properties (HK01234), together with US private equity firm Angelo Gordon, acquired a hotel in Mong Kok for HK$435 million through a deal brokered by CBRE. The property is widely expected to be converted into student housing. The two partners had previously teamed up in late 2022 to acquire the Pentahotel Hong Kong in Kowloon for HK$2 billion, which they later converted into the student residence "NISI."
In mid-August 2025, Centaline Investment launched its first Hong Kong student accommodation project, "Step 117," in Tsim Sha Tsui. The property, formerly a three-star business hotel, was acquired for HK$180 million and has since achieved 100% occupancy. Later that month, Centaline Investment announced the acquisition of another property, "Bonham Crest" in Bonham Road, Mid-Levels West, which it plans to convert into student housing with an initial capacity of around 200 beds under its student accommodation brand "Y.X."
On the mainland capital side, in late 2025, China Merchants Commercial REIT disclosed it had acquired a hotel property for HK$206 million, with plans to convert it into student accommodation offering 85 beds, targeting Hong Kong’s growing international student population. Around the same time, China Resources Longdene acquired a hotel in Kwai Chung along Castle Peak Road from the Tang Shing Bor family for HK$950 million. Market sources suggest the property is earmarked for conversion into student dormitories, potentially providing over 1,000 beds.
Commenting on this trend, William Chan, Chief Investment Officer at Hong Kong-based property development and investment firm Crystal Investment, told our reporter in a written interview: "The Hong Kong SAR government has rolled out initiatives like the ’City-wide Student Housing Scheme’ to streamline the conversion of commercial buildings into student residences. At the same time, the expansion of non-local student quotas by local universities has created a supply gap of over 70,000 beds. This makes student accommodation a counter-cyclical asset class with stable rental income and high occupancy, which is attracting both major developers and international funds."
Chan added that Crystal Investment entered the student housing space five years ago and has accelerated its push over the past three years. Its subsidiary, Y.X, currently operates four student apartment buildings near universities, with further investments planned.
In recent years, a combination of factors—higher international rankings for Hong Kong universities, the continued expansion of one-year master’s programmes, favourable IANG visa policies, and tightening US study visa restrictions—has kept demand from mainland Chinese students consistently high.
At the same time, on-campus dormitory beds remain scarce, and non-local students face stiff competition for them. As a result, most international and mainland students end up renting either standard residential flats or purpose-built student accommodation.
In mid-December 2025, our reporters visited the Y83 student residence in Hung Hom, a joint investment by Crystal Investment and AEW, a fund management firm backed by Natixis Investment Managers, and operated under Crystal Investment’s student housing brand, Y.X.
A check on the Amap mapping app showed that Y83 is about a five-minute drive or a 15-minute walk from both Hong Kong Metropolitan University and Hong Kong Polytechnic University. According to property managers, the 25-storey building offers around 600 beds across approximately 120,000 square feet of gross floor area.
Room configurations are mainly twin and single rooms. Twin rooms rent for HK$9,000 per person, while singles go for HK$13,000 per person. Utilities and internet are included.
During our visit, we found the property equipped with study spaces, a gym, and a dance studio. At the time of reporting, Y83 was fully occupied, with nearly 60% of tenants coming from Hong Kong Metropolitan University.
Notably, the management said the majority of tenants are from mainland China, with a smaller number hailing from the UK, Spain, South Korea, and elsewhere. To help mainland students better navigate Hong Kong’s job market, the residence even offers optional Cantonese classes.
Elsewhere, in late December 2025, student housing provider Student Living EduVation reportedly filed with the US Securities and Exchange Commission for an initial public offering. The company manages five dormitory locations in Hong Kong, serving about 400 individual clients annually—95% of whom are from mainland China, with an average tenancy of one year.
In his interview, CBRE’s Stephen Yun noted that compared to fragmented private residential leasing, institutionally operated student housing has distinct advantages. "Its appeal lies in the community atmosphere among students, strict security management, various social and career development activities, and fully furnished units," he said. "It is more of a service-driven product than a simple rental space."
Most of the current supply of student housing comes from the conversion of existing properties. According to Yun, acquiring three-star hotels or entire older buildings for retrofitting is the main approach, while developers rarely build student housing from scratch.
On large-scale projects, foreign and private equity funds are the primary investors. The typical model involves identifying a target property, forming a partnership with a local operator, acquiring the asset, and carrying out upgrades. The property is then either operated directly by the investor or handed over to the operator under a management agreement, with returns shared as per the contract. Local private investors and family offices also participate, but their investment size tends to be more limited.
"Foreign funds typically invest between HK$1 billion and HK$2 billion per deal, while local capital is mostly in the range of HK$100 million to HK$300 million," Yun said.
William Chan from Crystal Investment noted that his firm uses a combination of its own capital and that of strategic partners (private equity funds). "Typically, operations involve acquiring properties at market prices and renovating common areas. Rents are set at levels close to university standards, and the return cycle relies on high occupancy and long-term demand stability."
As to whether the market is in danger of overheating, Chan remains cautiously optimistic.
"The risk of oversupply in the short term is relatively low," he said. "Demand from both non-local and local students still significantly outstrips supply. With the government’s policies to attract international talent, market fundamentals are expected to remain solid for the next five to seven years."
In a press release on Centaline Investment’s website about its August acquisition, Centaline Investment CEO Teresa Yip was quoted as saying: "Student housing is a resilient and fast-growing segment of Hong Kong’s property market. Driven by the continued rise in non-local student numbers, these investments offer not only stable returns but also capital appreciation potential. Our experience in student housing investment and operations in the US, the UK, and Hong Kong reflects our market insight and management capabilities. This latest project is a key step in our plan to expand our presence in Hong Kong’s student accommodation market, with a goal of increasing our bed capacity to at least 3,000 in the near term."
Still, CBRE’s Stephen Yun cautions that the firm’s role as advisor involves carefully evaluating conversion costs, payback periods, and returns for each project, while also assessing individual risk profiles. "Currently, investment yields for student housing range from 5% to 5.5%. That yield is calculated by factoring in all costs—acquisition, renovation, and so on—against rental income from students," he explained.
By Li Xukui / National Business Daily
WBC LPF is a private real estate fund platform focusing on dormitory and co-living assets. It transforms residential properties into assets with stable cash flow through acquisition, renovation, and professional operation and management.
