Scape Group plea to let in overseas students or face plunge

The country’s largest student accommodation provider Scape Group has warned occupancy levels in the sector could plunge.

Scape executive chair Craig Carracher.

The country’s largest student accommodation provider Scape Group has warned occupancy levels in the sector could plunge unless the federal government prepares a scheme to allow international students to return from countries that have controlled coronavirus outbreaks.

Scape is backing calls by universities under which students from countries where the virus is under control would be isolated and tested to confirm they are COVID-19-free and then return to their courses as institutions seek to combat the slowing in visa applications.

Scape executive chair Craig Carracher expects occupancy to drop from 60 per cent to around 30-45 per cent “if we don’t introduce the safe corridor to ensure the market retains long-term confidence in our commitment to the international education sector in Australia”.

“There is real support in China and Southeast Asia from students wanting to fly into Australia, including Melbourne, to study through a safe corridor that would protect them and our communities,” he said, with the company ready to pay for charter flights if necessary.

He acknowledged tensions with China, a major source of students, saying education providers “still have to battle the Chinese-Australian relationship issues which are hovering over the sector”.

Mr Carracher said Victoria’s proposed stage 4 restrictions meant international students were more likely to stay in specialist towers as they were safer and they would not leave the country as some of their home nations are at greater risk.

“Australia is considered a controlled and safe environment and for students, who are not in the at-risk demographic, it’s more about the social inconvenience of not being able to study with peers and not be able to attend face-to-face lectures,” he said.

“Stage 4 restrictions in a managed and controlled community represents a safer option than uncontrolled COVID-19 spread in other markets like the US and UK,” Mr Carracher said.

Scape is expanding in Melbourne and has just bought the Oxfam Australia head office building in Leicester Street, Carlton. The property was acquired via Scape’s second joint-venture fund raised in 2019, which is now almost fully deployed. Oxfam’s sale was undertaken after advice from Ernst & Young that the Carlton building no longer suited the charity’s long-term needs.

Scape has been active even during the crisis and acquired the $2bn-plus Urbanest portfolio of 14 student accommodation buildings this year. It comprised almost 7000 student beds in four buildings in and around the University of Melbourne.

Scape also bought Atira Student Living last October, including the 576-bed student accommodation buildings on Peel Street near the Oxfam site.

The company pointed to the purchases as confirming expectations of international students returning over the long term, despite the impact of COVID-19.

Scape is operating at about 60 per cent across its Urbanest, Atira and Scape brands. Typically Scape would be above 90 per cent, with most students signing up annually. It is building another 9200 student accommodation rooms in Melbourne.