Rising Student Housing Demand, U.S. Fintech Strength, and Increasing Stock Sales

What’s happened: US companies and their shareholders, including private equity firms like Blackstone, are cashing in. After the Fed’s interest rate announcement, the risk appetite of stock market investors led to the strongest sales of publicly listed US company shares in over a year.

Why it matters: Sales reached an impressive $4.97bn in the US and $12.3bn globally.? Data shows that companies are seeing an increasingly strong demand for their stock from investors who believe now is the time to place some pretty big bets on the market recovering. This all comes in the wake of the Federal Reserve raising interest rates to fight inflation.?

What’s happened: International student enrolments in the US have risen by 80% from pre-pandemic levels, leading to an uptick in the need for student housing. Investment in purpose-built student accommodation reached $17.7bn globally in 2022, according to JLL data, with the sector being seen as an attractive opportunity for portfolio diversification.

Why it matters: The living sector, which includes student accommodation, now accounts for 32% of global real estate investment. This is a pretty big proportion and is up from 15% in 2010. Private investments in the living sector are seen as offering some serious value, with strong prospects for growth. Because so many alternative real estate opportunities fall within private equity mandates, the living sectors could prove a major recipient of these increased capital flows.

What’s happened: Brand new research from the Centre for Finance, Technology and Society at Nottingham Business School has revealed that the US is leading the way in fintech innovation in both the quality and quantity of patent applications. Researchers used bespoke indicators to assess over 16,000 patents in the fintech industry registered over the past two decades.?

Why it matters: The US accounted for 39.5% of the sample, followed by China, Korea, Japan and Europe. The US was the leading jurisdiction for all categories of registered patents except electronic wallets. The categories included things like e-commerce, verifying the identity or authority of a user of the system, secure identification of payer or payee, and payment protocols.

Summary Thoughts: Bankers and lawyers working on these public offerings have welcomed the surge in activity - to the tune of $72.5 billion worth of stock. Even so, according to Dealogic data this is still a 67% decrease from 2021's all time high. But confidence is improving - Michael Kaplan from law firm Davis Polk, reports that investors are now a lot more willing to invest than they were just a year ago.

The global student accommodation sector is back on investors' radars as student numbers begin to rise again after the pandemic. Investment in purpose-built accommodation has now hit its second-highest level in 15 years. The pandemic may have been a black swan event for the sector, but it's proving to be a viable investment opportunity for those looking to diversify their portfolios. Private equity investors, in particular, are finding the sector attractive thanks to opportunities for consolidation and economies of scale.?

The USA continues to lead the way in FinTech innovation and patent quality. These results foreshadow some great outcomes for the US fintech industry - growth in investment opportunities, more FinTech startups, more innovation, and great opportunities if you are looking to acquire intellectual property in the industry. Although, the study did also point out that competition from other countries like China, Korea, and Japan is increasing, so staying on top of industry trends and developments, as always, will be crucial for maintaining your competitive edge.

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