For Charlie MacGregor, chief executive of The Social Hub, the rationale behind launching the hybrid living platform back in 2012 was to offer something that stood out from the traditional spaces created in the institutionalised student accommodation market – or, as he puts it, “differentiate students from cattle”.
The Social Hub, previously known as The Student Hotel, is a €2.2bn (£1.9bn) purpose-built student accommodation, co-working and hotel operator with 23 sites across Europe and the UK. The business runs more than 10,000 rooms across Amsterdam, Barcelona, Berlin, Bologna, Delft, Eindhoven, Florence, Glasgow, Groningen, Maastricht, Madrid, Paris, Rotterdam, San Sebastián, The Hague, Toulouse and Vienna.
MacGregor launched the business at the age of 26, leaving his role at Peaston & Co, a student accommodation company set up his father, who he describes as “the godfather of PBSA”.
“I got inspired by my father and the lack of imagination that that generation had as student developers,” MacGregor says. “I grew up when they really saw that students were like cattle and were going to destroy the place.”
I believe you can use design to influence a certain type of behaviour instead of having signs everywhere saying, ‘don’t do this, don’t do that’.
“I believe that students deserve better,” MacGregor adds. “I wanted to give them a good experience, and I believe you can use design to influence a certain type of behaviour instead of having signs everywhere saying, ‘don’t do this, don’t do that’.”
Out of office
The Netherlands-headquartered company embarked on its first scheme in the UK with its £90m Glasgow project at 15 Candleriggs, comprising 494 rooms and co-working space. That building opened in April 2024.
The company now plans to develop up to four more schemes in the UK, with roughly 500 rooms per project, with €300m (£253m) backing from APG and GIC. MacGregor is searching for distressed office sites of 150,000-200,000 sq ft with potential for redevelopment in cities including Edinburgh, Manchester and London.
“London is the top target. We see the pressure that the office market is under and we hope to take advantage of that,” he says. “Cities like Manchester, London, Brighton and Edinburgh make sense to us. We are not going to be developing in second-tier cities.”
He adds: “We are specifically targeting empty office buildings that nobody is using anymore, and maybe coming into a bit of a distress situation. We don’t compete with hotel developers or residential developers. We can make good use of these old buildings and repurpose them, but also bring a new wave of life to that neighbourhood.”
MacGregor notes that the sector is witnessing a higher cost of financing and expects there to be an adjustment in values in the office sector that the company can take advantage of.
“If you look at the number of big empty office buildings, there are a lot, and it was the same in the GFC,” he says. “There is a huge re-regeneration opportunity, and we are getting into the zone where we can make the model fly.”
Creating connections
The Social Hub’s model revolves around providing hotel, co-working and PBSA as “three main industries under one roof”, MacGregor says. One advantage is the group can pitch not only to students but their parents too. “That’s a very strong marketing angle,” he says. “You know, if I offer your mum to come and stay in your student residence, it must be a decent student residence.”
MacGregor says the company’s model was criticised when it debuted a decade or so ago. “People were telling me that what we wanted to do wouldn’t work. They thought we were creating dangerous spaces,” he says. “They said that mixing hotel guests with students was a no-go, that it was going to be too dangerous.
“Ten years on, with 10,000 rooms, we can honestly prove that it’s safer. A PBSA block only has students in there. That means that they behave in a certain demographic-stereotype way, like when a group of guys go see a football match, they behave like a group of guys.”
MacGregor says The Social Hub has brought these different groups together to create something better. “We have trusted them. We give them a good high level of design, and we have used our operating methodology and design and brand to stimulate the right type of behaviour,” he says.
He says both student and hotel customers benefit from the companies’ facilities. Gyms are bigger than in a regular hotel, he says, while sites’ 24/7 receptions are a rarity in student accommodation. And, with the inclusion of co-working, MacGregor intends to bridge the gaps between the resident demographics, allowing young professionals at the start of their careers to cultivate a community along with corporate guests in the hotel.
“Co-working has been a part of the model for nine years, and it really works,” MacGregor says. “It’s quite an aspirational community for our students. You have young professionals, which the students are becoming, using our co-living model and you have professionals that are looking for next-generation talent, creating a real nice connection.”
Additionally, the model lets MacGregor “fine tune” the provision of the beds. “The advantage of this model is we have three dials to our business. If you’re in a place where there are options right next to a university, for example, then you allocate more of your rooms to students. If there’s less tourism, then you dial down your hotel allocation.
“So we are able to fine tune depending on where we are in the city. Edinburgh, Manchester and London, they’re all entrepreneurial cities. Lots of business, lots of travellers, lots of tourists, lots of students.”
MacGregor says the hybrid asset class is coming into its own. “I’m quite pleased to say we are slowly carving out our own asset class. I think hybrid is becoming much more accepted by valuers, by banks. Ten years ago, you were really limited because people had a box to tick. Now, many of them have a hybrid box to tick. We see that many planning departments have used us as a description of what they want in the regeneration zone. You really see that they’re embracing this asset class.”
Social Hub, social good
Charlie MacGregor wants The Social Hub to be an industry leader when it comes to the “S” in ESG. “ESG is important to us. We always aim to have sustainable buildings and we always aim to operate them to a high ESG standard,” he says. “We feel that we are naturally suited for this and want to excel.”
The company has applied to become a B Corp. “It is the only label that gives you thanks for ESG and encourages customers to use you as well,” MacGregor says.
MacGregor is focused on improving the refugee camps that develop during humanitarian crises via Movement on the Ground, an NGO he founded in 2015. The Social Hub also offers a scholarship via its TSH Talent Foundation, providing accommodation, mentorship and education. The company partners with universities and educational groups to provide the scholarship.
“Student housing is still an exclusive thing, and higher education is still a middle-class thing as well,” MacGregor says. “Since we’re all about inclusivity and diverse communities, we felt that running a scholarship programme was the best thing we could do. We are trying to put our money where our mouth is.”
Images © The Social Hub
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