Work is due to start this year on a £6m scheme to convert an office block in Sheffield city centre into student accommodation.
Sovereign House in Queen Street is due to be turned into 178 studios for sale in time for the September start of the 2015/16 academic year.
The developers said this week that they are responding to “an acute under-supply of student housing” in Sheffield, and the go-ahead for construction comes at a time when more student accommodation is planned in other parts of the city.
From council offices, Sovereign House will be turned into “studio rooms with boutique furnishings”. They will have access to “a range of luxury communal facilities including a TV/cinema room and a state-of-the-art gymnasium”.
A spokesperson for Knight Knox International said the accommodation “will provide a much-needed boost to the student housing sector, in addition to providing desirable accommodation to students due to its location within walking distance of the city’s universities”.
Price start at £59,995, with investors being told they will receive an assured rental yield of circa 8.35% for the first two years.
The company, which is working with Fortis Developments, says there remains a shortage of student accommodation in Sheffield whose student population has grown to over 60,000.
In particular, developers are looking to meet a demand from overseas students, especially from places such as China, Malaysia and Singapore, who are prepared to pay more for better facilities.
The continuing trend is for better quality purpose-built accommodation, which, it is argued, releases houses in student areas or families.
A proposed development between Broad Lane and Garden Street on the edge of the University of Sheffield campus has almost 400 bedrooms and is designed to appeal to overseas and mature students.
Behind the project is student accommodation specialists Watkin Jones, who already have a block across the road.
Meanwhile, more student flats are planned on the doorstep of Sheffield Hallam University.
Homes for up to 245 students are due to be built on the site of the former Gatecrasher ‘superclub’, at the corner of Matilda Street and Arundel Street, which was destroyed by fire. The developers are City Estates.