I propose to take Questions Nos. 1402 and 1403 together.
I welcome the recent announcement from the European Investment Bank (EIB) and the Housing Finance Agency (HFA) providing a new and increased financing investment of €434m student accommodation to support higher education institutions in the development of affordable student housing. The new scheme, backed by a forty-year €200m EIB loan, is expected to support the delivery of an estimated 2,700 new student beds across Ireland.
This initiative provides a framework loan facility to the Irish Housing Finance Agency (HFA) to provide finance directly to Irish public higher education providers to develop student accommodation.
This deal will further the Government’s priorities, as this new funding will form 25% of the Housing for All commitment made by the HFA. The funding is ring fenced for 5 years and is now open for applications.
The initiative is separate to the Government announcement where a total of up to €61 million has been approved in principle to unlock the development of over 1,000 beds across our universities. These were developments with planning permission that had stalled due to rising construction costs, and are now being progressed under my Department’s Short Term Activation Plan.
The Short-Term Activation Programme is a crisis response to the difficulties being faced by students in securing affordable student accommodation and the challenges being faced by the Higher Education Institutes (HEIs) trying to build student accommodation. This programme is the immediate response in advance of completing the new long term policy.
The priority is to activate the supply of new accommodation where planning permission already exists but developments have not proceeded due to increasing construction costs. The objective is to activate supply in a way that will enable targeted groups to access accommodation at more affordable rates.
Under this programme, the HEIs submit a project proposal that meets the programme criteria. If the project is approved, an agreed percentage of the total cost will be provided in grant funding to activate the PBSA project, subject to due diligence assessment, and compliance with the Public Spending Code and public procurement regulations.
In return, the HEI will ring fence a percentage of beds to be made available to target group students at below market rent over a specified number of years. The projects currently approved in principle will ring fence 30% of the new beds to be provided to the target group at a discount from market rent for an agreed number of years.
The balance of the finance required for any student accommodation project being progressed by a University is a matter for the individual University as an autonomous body and will not be administered or facilitated by the Department. I welcome the financing agreement between the EIB and HFA which will assist the HEIs to finance future student accommodation projects.
The long term policy approach which I intend to bring to Government in Q4, 2023 will include progression of standardised design specification templates and costing models to be developed in consultation with the DHLGH.
The objective of the PBSA Standardised Design & Specification Project is to examine international best practice and flexibility of design to inform appropriate standards in the delivery of affordable accommodation.
