First Read: Unite Group plc "2Q26 trading update: Strong occupancy offsets..."

Research evidence excerpt

First Read: Unite Group plc "2Q26 trading update: Strong occupancy offsets..."

reflecting higher interest rates and subdued transaction activity across

the investment market. Rental assumptions were broadly stable, with income declines Zachary Gauge

limited to 0.1% for USAF and 0.5% for LSAV in Q2. The update reinforces that while Analyst

zachary.gauge@ubs.comstudent accommodation occupational fundamentals remain resilient, capital values

+44-20-7901 5534

continue to be driven by financing conditions and valuation benchmarks rather than

rental growth. Charles Boissier, CFA

Analyst

charles.boissier@ubs.comCapital allocation: additional buybacks and Empiric update

+44-20-7568 4415

The integration of Empiric remains on track, with Unite having completed the transfer of

Nadir Rahmancity teams onto its operating platform and closed the legacy head office. Management

continues to target £9m of cost synergies in 2026 and £17m annually from 2027.

nadir.rahman@ubs.com

Trading at Hello Student has also improved, with reservations reaching 71% (+10pp y/y), +44-20-7567 1750

leading management to increase expected occupancy for 2026/27 to >87% from c.

85% previously. On capital allocation, Unite completed £165m of share buybacks

during H1 as guided, repurchasing 32.7m shares, equivalent to around 6% of issued

share capital, with the potential for more to come but dependent on the pace of

disposals and the availability of surplus capital.

Valuation: trades at a 45% spot discount to NAV.

Our PT is economic profit-based and equates to a 37% discount to EPRA NTA t+1.

Highlights (£m) 12/23 12/24 12/25 12/26E 12/27E 12/28E 12/29E 12/30E

Net rental income 257 276 294 333 330 343 370 405

EBITDA (UBS) 219 248 218 278 289 313 340 375