Edinburgh student accommodation provider UNITE may have lost up to £6m in the Icelandic bank collapse, giving rise to fears of rent hikes.

Edinburgh student accommodation provider UNITE may have lost up to £6m in the Icelandic bank collapse, giving rise to fears of rent hikes, Student can reveal.

The UK Student Accommodation Fund (USAF) has £30m deposited in Landsbanki, with Unite’s finances making up 20% of that sum, which amounts to 3.5% of Unite’s overall capital.

If, as looks increasingly likely the money cannot be retrieved, this investment could have a serious impact upon students living in Unite accommodation.

The company provides housing for over 39,000 students in 33 towns and cities across the UK.

As Student revealed earlier this year, the University of Edinburgh has recently been forced to rent accommodation blocks from Unite after an unexpected rise in the number of first-year students meant that university halls could not accommodate them all.

Unite offers student accommodation in various parts of Edinburgh, most notably the recent development of the Lady Nicholson building located across from George Square. Unite’s accommodation prices in Edinburgh range from £119-£178 per week, inclusive of bills.

If Unite loses the money invested in Landsbanki, it is feared this could have a detrimental effect upon the University of Edinburgh’s first year undergraduate accommodation, as well as students who are looking for non-university owned accommodation in their further years of study.

Last week, Unite were confident that the current economic crisis would not impact detrimentally on their business:

The USAF was performing “strongly”, a spokesperson said, demonstrating “the resilience of student accommodation as an asset class” as values of commercial and residential properties plummet.

Orla Murray, a first-year student living in Unite accommodation told Student: “Unite offers a higher quality of university accommodation, but it is more expensive. I think that the collapse will mean that Unite cannot guarantee that their prices will stay the same.”