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Two large student-accommodation forward-funding deals were reported between December 2025 and February 2026: Manchester at £160m and Southwark at over £200m once complete.
You have planning for a student scheme on a site near a good university. A buyer who commits before the first brick goes down could settle your exit. So when two big deals hit the news, you ask whether any of it reaches a scheme your size.
This post sets out what was reported, five questions to ask before you approach a buyer, and how to check your own scheme.
The 30-second version
- What it is: forward funding is where the buyer funds the build in stages as it progresses. It agrees your exit early: the buyer and the price are set before you build.
- What the news shows: a buyer agreed to forward fund a Manchester scheme (December 2025), and contracts were exchanged, conditionally, on a Southwark scheme (February 2026).
- The catch: a fixed price can give up some upside, and not every scheme will find a buyer.
- What to do: check your scheme against the table and the five questions below.
What did the recent deals show?
Three announcements, each linked to its public source:
- Manchester, December 2025. Legal & General agreed to forward fund McLaren Property's £160m, 737-bed Upper Brook Street student scheme (McLaren Group).
- Southwark, February 2026. Helical and Places for London exchanged contracts, conditionally, on a forward funding of their 429-bed Southwark student scheme, valued at over £200m once complete (Helical plc; confirmed in its 22 April 2026 trading update).
- Debt for the living sector, March 2026. Puma Property Finance and KKR formed a joint venture of up to £500m to write living-sector loans (Puma Capital Group).
Alongside these, UK PBSA attracted £2.1 billion of investment in the first quarter of 2026 (Knight Frank, 5 May 2026). Its August update put the second quarter at £164 million and the first half at about £2.3 billion. We cover it in PBSA Q1 2026 hits £2.1bn.
Three announcements do not make a market, but they show where the large money went.
Why does forward funding matter to a developer?
With the buyer and the price fixed early, you are not building on the hope of a sale later. Weigh that against the upside you might keep by selling or refinancing once the scheme is let.
On the debt side, some lenders will go up to 70% of gross development value (GDV, what the finished scheme is expected to sell for). It has to be the right developer, with the right track record.
Is your scheme ready for a forward-funding conversation?
| Your situation | What it means | Next move |
|---|---|---|
| Good location near a university, operator lined up, planning granted | You hold what a buyer asks about first. | Prepare the numbers on a buyer's yield basis, then test interest early |
| Good site, no operator yet | A buyer will want to know who runs it. | Name the operator and their record first |
| Smaller scheme, outside the big university cities | A forward sale may not suit. | Plan the lease-up and the refinance from the start. See our PBSA development finance guide |
| Planning limits the use to students | A for-sale fallback may not exist. The exit has to work on its own | Check the planning class and any use restriction first |
| Numbers only work on your margin, not a buyer's yield | A buyer prices on yield, not on your margin. | Rework the appraisal before you spend on advisers |
Our PBSA deals typically run from about £7m to £75m. Larger and smaller schemes are welcome.
Before you approach a buyer: five questions
- Is the location one where student demand is clearly deeper than the supply of beds? What evidence do you hold?
- Who will operate the building, and what is their record?
- Do the numbers work on a buyer's yield basis, not just your development margin?
- What does planning allow if the student use does not work out?
- If a forward sale does not happen, does a development loan followed by a refinance still work?
Frequently asked questions
What is forward funding in property development?
Forward funding is where the buyer funds the build in stages as it progresses, as in the Legal & General and McLaren deal above.
Is forward funding only for large PBSA schemes?
The deals in the news are large, but the five questions above apply at any size. For a smaller scheme, a development loan followed by a refinance is one alternative.
What do forward funders look for?
Each buyer sets its own criteria, but the same points come up: deep student demand at the location, a named operator with a record, planning in place, and numbers that work on a buyer's yield.
Start here
Tell us the scheme, the site, the planning position and how you plan to repay. We will say whether we can place it and set out the options. It is a confidential, no-obligation chat. We put every fee in writing before you commit.
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Read more: development finance · PBSA finance · PBSA lender appetite in 2026 · Forward funding explained
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