Unite Group has lowered its adjusted earnings per share (EPS) guidance to between 41.5p and 43p, reflecting the impact of lower income from the recently acquired Empiric Student Property and occupancy across its portfolio.

The student living company reported that in the year to 31 December, its occupancy rate stood at just over 95%, with rental growth jumping by 4%.

Year-on-year, its earnings increased by 9% to £232.3m, while its EPS rose by 2% to 47.5 pence per share.

The latest update comes as the number of UK 18-year-old applicants for the 2026/27 academic year increased by 5% year-on-year, with continued demand from “strong university partners”, Unite said.

Furthermore, it announced today that it has sold its 571-bed St Pancras Way property in London to Unite UK Student Accommodation Fund (USAF) for £186m.

Chief executive at Unite Students, Joe Lister, said that the firm has delivered a robust 2025 performance, with strong trading across the majority of its portfolio being offset by weaker demand in a small number of cities.

He added: "Growing domestic demand for higher education, improving international mobility and constrained housing supply underpin the long-term prospects for the sector. Students continue to place high value on the residential university experience, supporting sustained demand for the high quality accommodation and living experience that we provide.

"We have started to deliver on the strategic plan set out at the end of 2025, focusing on closer alignment to the strongest universities, building on our university partnerships and taking decisive action on costs. We have also demonstrated our disciplined approach to capital, having commenced a £100 million share buyback in January and this morning announcing the sale of St Pancras Way to USAF."

In its outlook, Unite said that demand for UK higher education remains strong, and together with constrained housing supply, this supports sustainable growth in its rents and earnings over the long term.

Despite this, the firm expects its income to be at the lower end of its guidance range of between 2% and 3% rental growth, while its occupancy is set to be between 93% and 96% in the current year.

Furthermore, Empiric Student Property’s income is set to be below expectations. The acquisition completed last month and has increased its annual cost synergy to £17m per year.

Following the trading update, shares in Unite dropped by over 9%.

Head of property research at Quilter Cheviot, Oli Creasey, said that the latest results are a "reminder of the challenges" faced by the company in 2025.

He concluded: "With occupancy dropped to around 95%, the lowest in recent years, the impact was felt across both the income statement and balance sheet, although it should be noted that rental growth remained strong at 4% on a like-for-like basis for the start of the current academic year.

"Of greatest concern for investors will be the guidance for 2026 issued this morning. Management first provided guidance on 2026 numbers at the company investor day in November 2025 when a reduction in EPS was flagged, but today's update downgrades those forecasts further.

"The key question being asked about Unite in 2025 was whether the occupancy figure was a blip that would be quickly recovered from, or a sign of longer-term issues. With a further drop now likely in the coming year, it seems the answer is more likely to be the latter."

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