Short-term rentals driving business for student-housing provider
An initiative implemented during the coronavirus pandemic as fillip to lost business is now being highlighted as the primary driver of growth for 138 Student Living Jamaica, 138SL, for the June third quarter even as business from student rentals continues to trend upward.
The student-housing provider, which caters to the populace at the University of the West Indies, took a bet on short-term rentals in mid-2021 as an alternative revenue generator to business it lost from cancelled student bookings during the COVID lockdowns.
Its strategy involved hiring a marketing manager to secure more bookings from business and conference groups but had limited success in first few months in light of restrictions associated with the pandemic.
Fast-forward little over a year later, 138SL Chairman Ian Parsard says the multiple strategies implemented towards energising short-term rentals are evidently successful, having contributed $35 million to quarterly revenue and $96 million for the nine-month period. That’s up from $32 million for the corresponding period of 2022 and $55 million over the nine-month period.
Profit grew four per cent year on year to $88.9 million on revenues of $347 million in the June 2023 quarter, which were also up 12 per cent. Over the nine-month period, profit jumped 13 per cent.
The gains primarily emanated from the improved performance in short-term rentals, Parsard said in the company’s earnings report.
He added that the group continued to perform according to projections, with average room occupancy of 86 per cent for the nine-month period. Altogether, 138SL operates 1,464 rooms at four locations on the UWI Mona campus, consisting of 1,692 beds.
Parsard is optimistic about the group’s performance for the remainder of the financial year and the upcoming academic semester, which begins in September. Applications for accommodation are said to have significantly surpassed the developer’s current capacity so far.
“We see strong indications that operations have returned to normalcy … our outlook is that this trend will continue into the foreseeable future as the University of the West Indies, Mona, has signalled its full return to face-to-face classes,” he said.
To prepare for the new influx of students, 138SL says it has incorporated additional layers of security, including 24-hour monitored CCTV camera system. Additionally, it has implemented a maintenance, inventory and asset management software called Manager Plus, which allows residents to directly communicate maintenance and other issues in real time from their mobile phones.
The company has also introduced a digital payment system that will allow residents to pay fees from their smartphones or other digital devices.
The convenient payment system is one of the tools the housing provider is utilising to cut down on receivables or outstanding rental fees.