Converting an office or other building into student accommodation involves a change of use, usually requiring full planning permission because purpose-built student accommodation typically falls outside permitted-development rights, and is financed with development or conversion finance drawn against cost and gross development value. Lenders advance up to about 65 to 70 percent of total cost, capped at around 60 to 65 percent of finished value, released in stages against a monitoring surveyor, then repaid by stabilisation and a refinance onto an investment loan. This is finance to convert a building into student accommodation as an investment, not a student maintenance loan.
- RouteChange of use to student accommodation
- PlanningUsually full permission for PBSA
- Loan to costUp to about 65 to 70%
- Loan to GDVAbout 60 to 65%
- DrawdownStaged, against a monitoring surveyor
- ExitStabilise, then refinance to a term loan
Why conversion is attractive
Planning and change of use
- Change of use: converting an office to student accommodation needs the right planning consent
- Permitted development: limited and usually not available for PBSA, so plan for full permission
- Local plan and student-accommodation policy: cities often have specific PBSA planning policies
- Building standards: fire, amenity and space standards the conversion must meet
How conversion finance works
| Measure | Indicative level |
|---|---|
| Loan to cost | Up to about 65 to 70% |
| Loan to GDV | About 60 to 65% |
| Term | 18 to 36 months |
| Site funding before consent | Often bridging, then development finance |
What lenders assess on a conversion
Conversions can add beds where they are needed, faster than a new build. Knight Frank counts around 19,000 PBSA beds under construction for 2026/27, below the ten-year average of about 21,000 a year, and most of that is concentrated in a few large cities. A well-located conversion near a strong university, in a town adding little new stock, meets real demand.
The exit
