Students landlord Unite could face £3.5m hit in wake of Grenfell Tower fire

Student digs landlord Unite on Wednesday warned it could be forced to temporarily close a number of bedrooms and take a £3.5 million hit in the wake of the Grenfell Tower fire.

The FTSE 250 property developer has been forced to make minor adjustments to six of its 132 properties which feature aluminium composite material cladding. These include buildings in King’s Cross and Wembley.

They did not meet the standards set out in an initial test for high-rise landlords after the June fire. The properties have now been deemed safe by experts.

However, Unite, which owns 49,000 bedrooms, said it is awaiting the results of a second phase of Government testing which is looking at the performance of different cladding systems.

If the cladding needs to be replaced, the number of beds it has available for the 2017/18 academic year could fall by as much as 600 while it does construction work.

That could result in lost earnings of up to £1.5 million for the accommodation provider, with the work costing as much as £2 million over two years.

Separately, the company noted a fall in applications to UK universities for the upcoming academic year from EU students and from older people who are choosing to remain in employment.

However, reservations for Unite’s accommodation are still at record levels, and the firm expects full-year rental growth of 3%-3.5%.