The ability for students to exit HMO tenancies with two months’ notice will also reduce income security for private landlords. HMO supply has fallen by 9% over the last four years and we expect this trend to continue. DELIVERING OUR STRATEGY At our investor event in November, we set out how we are responding to changes in our market. Our focus is on delivering operational excellence from our best-in-class platform and ensuring optimal capital allocation to deliver the strongest risk-adjusted returns for shareholders. We will focus on six priorities to help deliver on these objectives. Operational excellence • High-quality, growing income – We are targeting 97%+ occupancy in our core cities and above-inflation rental growth, in line with our long-term performance. This is underpinned by our target to grow university nomination agreements to 60% of beds from 54% (including Empiric) which will be achieved by delivering our university joint ventures, winning share from competitors and exiting assets with lower university demand. • Taking action on costs – We are being proactive in right- sizing our cost base to reflect more challenging market conditions and ensure that we deliver efficiencies from our recent investment in new technology platforms. • Deliver our business plan for Empiric – There is a significant opportunity to improve occupancy across the Empiric portfolio over the next two years, alongside delivery of our cost synergies, which supports earnings accretion from the acquisition from 2027. Optimal capital allocation • Increase alignment to the strongest universities – We expect the UK’s strongest universities to outperform and capture a growing share of student numbers in the next 5-10 years. Our committed and future investment activity aims to increase the portfolio’s weighting to high- tariff universities from 67% currently to 80% over the medium-term leading to a more focused, higher-quality portfolio with a presence in 18-20 cities. This realignment is a key enabler of our return to 97% occupancy. • Grow university partnerships – Our first two university joint ventures with Newcastle University and Manchester Metropolitan University are now formed and will see us deliver 4,300 new beds on-campus at affordable rents over the next five years. Building on the strength of CHIEF EXECUTIVE’S REVIEW continued A record number of UK 18-year-olds started university in 2025/26 with 2% growth in the number of new undergraduates. Growth was particularly strong at high-tariff universities where acceptances grew 7%, while medium- tariff providers saw 2% growth and low-tariff experienced a 2% reduction. This growth supported an increase in the proportion of beds let to universities through nomination agreements to 59% (2024/25: 57%) but was offset by weaker sales to international postgraduate students and an increase in students choosing to live at home, which particularly impacted lower-ranked universities. Overall, our portfolio delivered 95.2% occupancy and rental growth of 4.0% for the 2025/26 academic year (2024/25: 97.5% and 8.2% respectively). The majority of our portfolio performed strongly with 19 of 22 cities averaging 97% occupancy. Vacancies were concentrated in three regional cities (Leicester, Nottingham and Sheffield), where weaker demand combined with high levels of existing and new supply. We also saw lower occupancy in new buildings or buildings where we delivered large capital projects, which were slower to let in a more competitive leasing environment. HOUSING SUPPLY REMAINS CONSTRAINED New supply of PBSA is down 50% on pre-pandemic levels, with around 17,000 new beds expected in 2026, reflecting viability challenges created by higher costs of construction and funding, as well as the time required to secure planning and Building Safety Regulator (BSR) approvals. Weekly rents now need to be at least £230 for new PBSA development outside of London to be viable, meaning there is little prospect of new PBSA supply in many markets. Build-to-Rent (BTR) is a source of growing competition in larger regional cities, particularly for international students, but new supply of BTR faces many of the same viability issues. Obsolescence of older university accommodation continues to impact supply, with 5,000-10,000 beds being removed from the market each year due to building age and the need to operate buildings more sustainably. Over half of students who need term-time accommodation live in HMOs where many private landlords are choosing to leave the sector due to rising mortgage costs and increasing regulation. The Renters’ Rights Act introduces new regulations for HMO landlords and rights for tenants from which PBSA is exempt. From May 2026, entering tenancy agreements more than six months before the start date will be banned, disrupting HMO lettings to students early in the 2027/28 sales cycle. THE UNITE GROUP PLC Annual Report and Accounts 2025 18 STRATEGIC REPORT