Unlocking Land to Solve Kenya’s Student Housing Crisis In Kenya

Kenyan universities and Technical and Vocational Education and Training (TVET) institutions have faced a student housing crisis for years, and there seems to be no solution coming any time soon because there is simply no money to put up hostels.

Kenyan institutions are facing severe financial problems, including billions owed to suppliers and controversy over a new funding model. Amid this financial chaos, the discussion about developing student housing has been sidelined.

But even though they are facing a cash crunch, these institutions have lots of land, key assets that can solve the student housing crisis.

The solution lies in Public-Private Partnerships (PPPs), particularly joint ventures. Under such arrangements, institutions could contribute land, while private developers finance, build, and manage hostels or purpose-built student accommodation (PBSAs). Students would gain access to safe, decent housing, and developers would earn a sustainable return.

But for this to work, universities and TVET institutions must work with experienced and credible PBSA developers, and the best in the market is undoubtedly Acorn, Kenya’s and Africa’s largest developer of hostels or PBSAs, and currently manages 4,500 beds housed under seven properties.

Acorn develops these PBSAs under the Qwetu and Qejani brands of hostels.

Acorn develops and operates purpose-built student accommodations through two vehicles: the Acorn Student Accommodation Income Real Estate Investment Trust (ASA I-REIT) and the Acorn Student Accommodation Development Real Estate Investment Trust (ASA Development-REIT).

Both REITs have consistently demonstrated that it is possible for a private sector developer to sustainably put up student housing that meets the demands of today’s learners.

Evidence of this is seen in the high occupancy rates for Acorn’s properties, which stand at 81%. This could have been higher were it not for the student holiday breaks that punctuated rent payment cycles.

Additionally, student tenant satisfaction is high. All Qwetu properties recorded an annual Customer Satisfaction (C-SAT) score of 5.1 in 2024, above the minimum threshold of 4.2.

The way forward

Some institutions are beginning to see the potential. In 2022, former University of Nairobi Vice Chancellor Prof. Stephen Kiama signaled openness to using PPPs to unlock the school’s massive land holdings. For instance, the university has 40 acres behind ANP Hostels in Loresho, Nairobi—land that could accommodate tens of thousands of beds.

Institutions of higher learning should knock on Acorn’s doors to partner to develop PBSAs.

Read Also: Acorn’s ASA I-REIT Continues To Outpace Nairobi Property Market As Vuka Takes Lead