Global Student Housing Trends with Joe Persechino (Yugo)

00:04
Kristian Lupinski
Welcome back to Pillow Talk Sessions. I'm Kristian Lupinski, joined as always by my co host, Jessica Gillingham.

00:09
Jessica Gillingham
Thank you, Kristian. And today on Pillow Talk Sessions, we're joined by Joe Persechino, who is the Chief operating officer at Yugo, which is the only global student accommodation brand operating in 14 countries everywhere from Japan to the US with Europe in between.

00:28
Kristian Lupinski
We'll also be exploring what makes student living so resilient, how branding and strategy drive global growth, and where the next wave of opportunity lies in the fast expanding sector.

00:38
Jessica Gillingham
Joe, welcome to the Pillow Talk Sessions podcast. Really pleased to have you as a guest and I know that we'll have a really good conversation here, but before we sort of get into the nub of the discussion, can you tell us a little bit more about Yugo? And by the way, my son who's a student is called Hugo, so I might like sort of mistakenly start saying Hugo, but Yugo. Tell us a little bit more about Yugo and also about yourself and how you came into the student accommodation.

01:10
Joe Persechino, COO of Yugo
First of all, thank you both for having me on and hello to the audience and I don't mind if you say Hugo. There's worse brands that you can be associated with, so I won't take it personally. A little bit about me then. So I've been in the PPBSA space since 2011, so nigh on 15 years. I started at Unite, as a lot of people do and did and got my grounding there. Never knew anything about student housing. My previous history had always been in retail and big box FMCG space prior to going to Australia and working in the gambling industry for five years. So very different, but a lot of skill sets that were transferable and a lot of what I'd learned throughout my career prior to Unite, I felt was very transferable.

02:06
Joe Persechino
So I fell into it and I suppose a lot of people will probably say that the same thing you fall into student, because no one, certainly at the time, no one used to know what it was all about. And yeah, I've been in the space now 15 years. I'm at Yugo now, which I'm proud to say is the largest operator in Europe and at a global scale is almost the largest globally. There's obviously a couple of American operators out there that have got huge portfolios, but we're on a par with them currently around 110,000 beds across 14 countries globally from, we like to say from Seattle to Sydney, but effectively the States right through to Australia, Japan and everywhere in between. And we are, you know, effectively we call ourselves the global brand and operator in the student space.

02:56
Joe Persechino
And I'm sure we'll touch on brand as we talk as we move forward. But we form part, Yugo forms one part of the DOT Group which is the parent company, the umbrella company which consists of four verticals, one being the investment management side which is GSA Global Student Accommodation. Yugo is the operating brand, Kinetic Capital which is development so provides financing for developments in student and also touches into other areas of residential living. And finally student.com which is effectively what we call the marketplace for students. So it's like the booking.com but for student accommodation.

03:38
Joe Persechino
So together we form part of the wider dot group and we feel that we've got our own little student ecosystem if you like, where we effectively are a true vertical and work across every part of student that you can think of from planning development stage right through to the leasing and online booking journey, etc.

04:00
Jessica Gillingham
And 15 years is a significant amount of time to be within a vertical. So you must have seen huge amounts of changes within PBSA within that time. Do you want to give us like a. A short summary of the changes that you've seen in that 15 years?

04:18
Joe Persechino
It's going to be hard to give you a short summary. There's a lot that's changed from when we first entered. Kristian’s a good editor. Yeah, thankfully Kristian can edit out. So yeah, a lot has changed and it ranges from the approach that operators take in terms of the service delivery and what that means through to the actual physical nature of the product that is being developed today. So when I first joined, things such as shared bathrooms and twin rooms were prevalent or non en suites as well were very prevalent. It was a huge focus on density of rooms and there wasn't really any or a lot of attention paid to the communal areas, the amenity space, the community building. A community within pbsa.

05:17
Joe Persechino
It was very much real estate face, real estate focused and I suppose that was natural because it spawned from residential and residential as we know it, as we knew it. That's also changing was very much you just build a. Put a building up, erect a building, put rooms in it and then hand the keys and then you don't see anyone until their lease is up and they move out unless there's a maintenance issue along the way. So that was typically the original approach. It was a new sector, you know, it's very much an alternative back then. And so therefore it was let's not reinvent the wheel, let's build what was already been built before.

06:00
Joe Persechino
However, over the years we've seen a strong focus on amenity service, the community aspect, but also importance of pastoral care, wellbeing and mental health side of student learning and their experience. And I think something that we're very passionate about and is more and more prevalent across the sector is that the university experience for students is more than just you go to university, study in the library and then your student accommodation is just somewhere to place your head at night. You know, we've worked very hard over the years to ensure that where you live forms part of your university experience.

06:47
Joe Persechino
Because if you relate that back to, if you're sharing a flat with others that you don't know, from different countries, different cultures, that's, you know, that's not only in university where you do that, you can do that at home and that's where you start to build these lifelong friendships and you get to experience those different cultures and different points of view and really start to make some good friends. And I think that's really important. And, and for us as managers of pbsa, it's really important that we encourage that the inclusivity aspect, the diversity, equity, et cetera is really important. And there's a phrase we use where we believe that our position within the whole university experience is to help young adults transition from home life into adulthood and independent living. And that's our focus, is how can we help that transition, ease that transition?

07:47
Joe Persechino
Because we know through the numerous surveys that we carry out each year, both with parents, but also with students as well as universities on top, you know, we understand what the challenges are and I'll probably get beaten with the Eurogen exa stick here, but, you know, I think kids these days have got it a lot easier than perhaps we had in the past and are a bit more mollycodd perhaps. And therefore the life skills that we may have learnt during our time growing up perhaps aren't the same as those skills or aren't transferred across in today's generation. So, you know, we see a lot of, we hear a lot about and get a lot of feedback on the surveys that parents are concerned about.

08:37
Joe Persechino
How will their children know how to cook, how will they know how to wash their clothes, what setting to put it on so they don't get whites that become pink, et cetera. So, you know, whilst this seems small, you know, they are concerns for parents and then obviously from a university perspective, they're concerned about students, mental health and ensuring that they've got a, a safe environment within which to live and study, but also that we work alongside them in terms of signposting when we spot potential signs of stress or something not quite right. So it is very much about the sector working hand in hand with other stakeholders, universities, parents, etc.

09:22
Joe Persechino
And I think that's a fundamental shift where there were very much PBSA was almost seen as the enemy to universities and the evil profit driven businesses that are just trying to gouge students. Whereas I think that has softened over the years. We're now seeing far more collaboration within the sector.

09:43
Jessica Gillingham
My son Hugo does actually listen to this podcast and he'd probably disagree with you. I think that he's got it easier. But I had a memory you talked about twin rooms back in the day. I actually I spent part of my university in the States and I had a triple room I had to share with two other people. It was horrendous. Before we get into the nub of it and I know Kristian's going to lead us into the first topic, but I just want to reflect something back to you. And we on this podcast there are some set themes that we tend to talk about and one of them, we give it the broad brush of the hotelization of real estate or the hotelization of the rental living sectors. And you've kind of illustrated that really quite nicely in that 15 year difference.

10:31
Jessica Gillingham
And when we talk about the hotelization, we don't necessarily mean amenities or anything like that. It is more about coming from a customer focused perspective and a service perspective and sort of putting the customer and their experience at the center, which is typically what hospitality does. But now we're seeing, you know, PBSA also build Taranco living as putting the customer's experience at the center, which is kind of what you talked about, that journey is that the students and how they experience the building is kind of really central.

11:11
Joe Persechino
Absolutely. I think it's an obvious statement that many marketeers state, but the best form of and cheapest form of advertising is word of mouth. And that is absolutely true. And it's very prevalent. I mean, there's an example that I do recall which shocked me at the time when I was at Unite and there was a building that the property that we had in Liverpool and one of the students from the previous year was a Chinese student and they loved their experience so much that they told their friends and he actually managed to get, I think it was 28 of his friends from China to live there the following year along with him. And you know, you think of what the cost of acquisition would be on those 28 students especially because they're international marketing to China, which is very difficult in terms of access.

12:04
Joe Persechino
You know, that resonated with me and I think the whole sector understands that word of mouth is key and reputation is key and the experience for the students is essential a for the success of the property itself, but also for the student. Because if we're ticking the box and they want to come back and stay with us as a rebooker or returner, that's the best indication that you're doing a good job. They want to stay with you. Because it's not about price. As much as we talk about affordability and cost of going to university, etc. That's only a part of the whole piece, you know, the whole puzzle. It is the experience, it is the time that they have, the service delivery that they get from the staff and how at home, I suppose they feel within our properties.

13:02
Joe Persechino
And you know, that's a real focus and it has to be. I mean it just makes everyone's life so much easier. If you've got a student that comes back the following year, you know their name already so you've already got that relationship that you've built up and you know, it's a gift that our teams have on the ground where they can be managing a 1500 bed property and yet they know every student's name. So I mean that's impressive. But it also for you as a student, if someone, or even you know, in hotels as we've seen it, if they welcome you by your name, you know that goes a long way and hotels is slightly different because it's a shorter stay.

13:38
Joe Persechino
But if you're living there for a year and they know your name out of 1500 students, that instantly gives you that connection and makes you feel warm and fuzzy inside and it's a great start and first step to hopefully returning the following year. Retaining them as a student. Oh yeah.

13:54
Kristian Lupinski
I mean, I'm just thinking about when I went to a student, I was the guy that was missing a door. I don't know where the door went but you know, it makes me think that I want to go back to university now. And you know, I've seen some of the student accommodation. More we talk about it just sounds like such a great place to live. I mean, okay, you'll figure out how to wash your clothes, that's fine, that's all about evolving as a person. But the environment that you are really kind of forms your idea about the world and the people around you. So having that, the first stop, be a good student accommodation where you can grow, I think is amazing. I think we should jump straight into some of the topics here that we have outlined today.

14:33
Kristian Lupinski
And the first one is looking at global student living as a scalable model. The student accommodation sector is seeing global demand outpace supply. You know, what makes this segment so resilient? And you've answered a bit of it, but also compelling. And how might its operating principles influence how we design and scale other residential formats?

14:54
Joe Persechino
Big question to start off with, so I think I'll try and answer it in two parts. The first part is touching on the scalability. We know that over the next 10 years, probably less, there'll be 240 million students, tertiary students worldwide. Now, of course, not all of those will need student accommodation. You've got to segment those out to online courses, people that study and commute from home, et cetera. But that's a huge number and we know that what we call penetration rates, but effectively the availability of student housing, or pbsa, within many markets, there's a. There's a huge shortage. Very, very much undersupplied. If you think. If we take that the US and UK are the two most mature markets and they're, you know, I think the UK is hovering around sort of 30 to 35% penetration.

15:55
Joe Persechino
Then you compare that to, say, in Italy, where you're probably 5%, so only 5% of. Of those students that need accommodation can be housed. You know, that's a huge shortfall. And if you extrapolate that 240 million number out to the end of 2050, predictions currently are that number will grow to over 400 million. So from a scalability perspective, the future looks bright in terms of numbers. So it's a sector that we can get behind. And I touched on before that, PBSA was seen as an alternative by many institutions and capital partners and players. In my view, residential itself was seen as an alternative, whereas now, I think residential is core. It's absolutely core. It should sit alongside offices and other sectors like retail.

16:50
Joe Persechino
And in fact, over the last few years, we've seen that investment into living has outpaced what traditionally was the biggest sector offices. And we know that Covid's had an impact, et cetera. So I think the future looks very good in terms of numbers coming through. And we've seen penetration, sorry, participation rates increasing across many markets, many countries, in terms of the number of students that are opting to go to Universities, it becomes more available to two different countries. And I think that the nuance though is a we know that it's difficult to build, costs have increased across labor, but across materials, cost of land, etc. So it is hard to build at the right price or a good price at a value for money price point.

17:48
Joe Persechino
But the nuance really, which does affect other sectors, and this is something that we've been looking at over the last couple of years, is that we've seen the rise of BTR and co living and flex living. And I suppose it's the opaqueness in terms of data that's the challenge. So in the US until recently it was very open, everyone fed into college house and you could see how the market was trending and how rents were trending and occupancy, etc. That's on its way out now because of recent changes. But when you throw in new sectors or new subsectors of living, such as co living, it's harder to track how many students are actually potentially tempted and do live there. And at the moment we're making educated, or hopefully educated guesses as to what that can be.

18:42
Joe Persechino
Because understanding what percentage may opt to live in BTR or co living has an impact on whether a scheme should go ahead, whether it stacks up to develop something new, what your price points should be, what you can expect in terms of occupancy, how difficult it might be, your marketing strategy. There's a series of implications that you need to take into account. But when you don't have solid numbers and data to back you up, it does make it challenging. But I think as with student, you know, co living, btr, there is a place for everything. They are subsectors of living. And we know that the ultimate mantra, if you like, of the living sector is that everybody deserves and needs a roof over their head. And we know that there's just not enough supply out there of any kind of housing.

19:37
Joe Persechino
We've seen the shortfalls, we've seen the targets the government set and don't hit across the world. So from a buoyancy perspective, the sector is bright. From a delivery perspective, it's challenging. And then obviously the opaqueness or opacity of not having the data to make better informed decisions about where to build and what to build present a slight headwind. But in general it's a very positive trend.

20:07
Jessica Gillingham
From my perspective, I know that we're going to go into a little bit more about growing globally and what it's like to operate in different markets because that must be hugely challenging and I know we're going to go into that in a minute, but you've talked also about the shortfall of supply in build to rent and co living as well. Are you tempted to go into those asset classes as well? Or, you know, what's your kind of feeling of that? Sort of, you know, expanding? You've got this great brand, you've clearly got happy customers, they're going to grow up and want other asset classes. What's your kind of feeling about that?

20:53
Joe Persechino
I think there's a number of aspects to take into account and you know, if I think more broadly, it really does depend on, you know, everyone's got their own strategy and it really does depend on where you think the opportunity may lie. And should you try and be a jack of all trades and spread in to different segments of the living space or do you just focus and hone and really get, try and be great at one thing? And there's not necessarily, you know, one way is not better than the other necessarily. I suppose from our perspective we think that focusing on student is the, is the best thing for us to do. But that's because we've got a long history of being in student, you know, in the current guise.

21:42
Joe Persechino
But also if I mention our founder, Nick Porter and chairman who is regarded as the Godfather of PBSA, he originally set up Unite back in 1991 and that was really, I suppose the first scheme in Bristol then with the nominations to the university was the first, was the first step into PPBSA in the UK. So that's over 30 years of history and it's always, he's always had an unwavering drive to focus on student and try and just get better at what we do year on year and improve on that, whether it's the service, the quality of the building, the relationships and obviously the ultimate return to stakeholders and that's the path we've chosen. Just try and be great at what you do.

22:35
Joe Persechino
Now how you define great is a different story and everyone will say that they're very good at what they do, but you can always improve. And I suppose what we target and what we're proud of is trying to be pioneering. So going from that very first asset in Bristol in 91 to now, 14 countries across the globe, nobody else has got that footprint, nobody else has done that. So you touched on it on your, on the question you just asked Jessica in terms of what it must be like going into New Markets, and that's pioneering. We've gone into markets which people have, you know, others have never set foot in or had never set foot in. And it's a steep learning curve.

23:19
Joe Persechino
But I think by offering, by knowing what you're offering is, and really focusing on the delivery of that for us is certainly where we want to continue to focus. Now our split is probably 95% to 5% student during term time, because in some markets it isn't. There are blurred lines. So you don't have, you know, in the UK you have a sui generis planning consent for student, but you don't have that. And typically in other countries it'll either be classed as residential or hotel use and sometimes commercial. And there's different legislation that sits around that in terms of the least types that you can offer, the length of stay and the types of people that you can offer to. And then you think of the US and the Fair Housing act there, which means that you can't discriminate against non students.

24:16
Joe Persechino
So, you know, there are nuances that you have to incorporate within your offering. But typically we're 95% student and then during the summer it's a different experience because in Europe especially you will run a summer market where whilst we do focus on students and language schools and university courses and accommodating those students, we do run tourist or hotel type properties as well during the summer.

24:49
Kristian Lupinski
I wanted to dig a little bit deeper on that as an operator, as you mentioned, expanding into new geographies. You said 14 countries. You know, how do you balance this growth with consistency? Especially, you know, you touch on it a little bit, but, you know, customer expectations, regulations, cultural norms, you know, they vary so widely.

25:11
Joe Persechino
They do, they do. And I suppose a lesson that we learned very quickly early on was that one size does not fit all. You can't just pick up the UK model and transplant it into other markets and expect it to work. You do need to really understand and get under the skin of each market. So the way we approach any market is that typically we take up to about two years researching that market to understand the nuances, the cultural aspect, how do people buy, how do they purchase? What's the understanding of pbsa? Do they have an understanding? Typically, education is the first point that we touch on. We need to educate universities, parents, governments, local councils on what PBSA actually is, because invariably it's never existed.

26:06
Joe Persechino
So once we've gone through that phase of the education piece, it's then understanding how easy is it to do business in that country. How easy is it to get planning consents to build? Are there restrictions, are there wider master plans that mean that actually you're not allowed to build student inner city, it's got to be on the periphery. And then what does that mean in terms of travel times for students and therefore the attractiveness of that to a student population. But then also the strength of the universities, you know, number of universities in that country, in that city, what's their strength, what's their strategy, are they growing, are they in decline, you know, applications up or down, etc. Where do they sit in the Times higher rankings as well as the QS rankings.

27:00
Joe Persechino
And really cross referencing that, putting that all together and then saying, right, we think this is a market that we should go into. It hits our minimum thresholds in terms of number of students. What's the percentage split between domestics, internationals, the domestically mobile students? Effectively that's your addressable demand, which is the internationals and domestically mobile. And then looking at the capital so the investors, effectively. So the advantage that we have as a group that I touched on earlier in part the Doc group, is that we manage and operate properties on behalf of our sister company gsa, but we also manage for other clients, other institutional clients. About 45% of our portfolio is GSA managed stock. So actually the majority is non gsa.

27:55
Joe Persechino
And for us it's about partnering with the right capital partner in those markets and making or putting together a compelling argument as to why they should come with us into that new market, depending on the market, because every capital partner or investor will have their own risk view of each market and whether they will allocate and how much they will allocate to those markets. And that will drive the returns that they're looking for. And for us, it's important that we marry the right capital partner with the right markets and the right opportunities to a deliver on what we want to deliver in terms of the brand promises that we make and the service, et cetera, and obviously a successful scheme, but also the returns that the investor wants.

28:50
Joe Persechino
So it's not a case of someone turns up tomorrow and says, right, we want to go into X country, will you come with us? And then we just say yes on the spot. There's a lot of thinking that has to go into that because as an operator and every other operator this will resonate with is, you know, the key to efficient operations is scale. And you need scale in cities and in countries in order to achieve that. And if you just go in for one property for 300 beds, it's really not going to work.

29:23
Joe Persechino
Well, it's definitely not going to work, but if you've got a capital partner that's willing to commit a number in terms of investment and they have a strategy where they want to grow to X thousand beds over a period of time, then we will happily work with them and make that work, because we know that there's longevity in the market. There's no point in entering today. Someone builds something for 300 beds and then they're looking to flip it as soon as it's built and occupied, because we've just invested a hell of a lot of capital ourselves in going into that market and it'd be wasted. So it needs to be a cautious approach. And I suppose the beauty of being in 14 markets now is that we have two focuses.

30:09
Joe Persechino
One is scalability in that market and growing in that market to increase our efficiency, which we pass on through NOI performance to investors, but also looking at new markets that we want to go into and we are keen on, and then finding the right partners to go into those markets. You know, we've got a list of markets that we are interested in entering and it's just about finding the right opportunities and partners to do that with.

30:38
Jessica Gillingham
There's so much complexity which kind of really builds the moat around what you're doing as well, doesn't it? Like, you've got to have so much in place apart from expertise, relationships, you know, all of patience, all of those things around that moat, which is really interesting. But what I'd love to. Firstly, I. I don't know whether you tell us, but I'd love to know which markets you're really excited about. But you don't have to tell us if you don't want to tell us that. But yeah, I can tell you now.

31:11
Joe Persechino
I'm happy to tell you the markets that we're. We're excited about, that we're in. I won't divulge just yet the markets that we are looking to go into, but, you know, if I think of in Europe, there's. There's a huge opportunity, as I said, the UK is the most nice, the most mature market, but there are a number of nascent markets out there. We've seen the recent, you know, the last five or so years, the surge in Spain in terms of development and PBSA being built, but we see a huge opportunity in Italy. Italy. We've been looking at this market, I've been looking at this market personally since probably 2016. It's taken a long time for us to get into that market. We did enter successfully last year and we have seen the opportunities there are exponential. The growth opportunity is huge.

32:09
Joe Persechino
It's got the lowest penetration rate in terms of supply in Europe. It's the third largest, I think, in terms of student numbers. Numbers sort of vary a little bit from month to month and year to year, but it's huge opportunity. And that's because it's A, under supply, as I mentioned. But B, it is difficult to enter and it's difficult to get your head around things like the planning system, which can take invariably five to 10 years to get planning permission. And capital is not that patient. They need to deploy to start seeing a return. But we see huge opportunity there. There's been a big shift. You know, Milan has been the focus for.

32:51
Joe Persechino
For a lot of other players in terms of trying to get into Milan, because they have been on a journey over the last few years with their own masterpiece plan in trying to attract more students to Milan. You know, strong universities. But you look at it as a country, there's very strong universities. You know, there's a huge university in Rome, you know, over 200,000 students in one university. I mean, it's incredible for a European university. You've got the oldest university in Bologna from the early 1000s, you know, 1081, I think it was when it was first born. I think it trying to claim that it's the oldest university in the world. You know, there's a long history of universities in that country and it's a great country to live in.

33:37
Joe Persechino
The climate's very good, very attractive, and we see huge opportunity there and we're working on a number of those opportunities as we speak. So that's one. The second one which surprised me and didn't surprise me, I would say, is Poland. Not a lot of people would have looked at Poland. There's still a lot of value to be had. I think that's where I mentioned that the research really comes to the fore more because, you know, Southern Europe, whilst you can't bucket everything together, there's similarities between Spain and Italy, for example, in terms of culture and the lifestyle, the weather, etc. Poland is different. And, you know, just looking at a metric, when I talk about internationals, people will naturally think, oh, it's Chinese students or Indian students.

34:27
Joe Persechino
Well, internationals in Poland is not Chinese or Indian students, it's more Eastern bloc or Lithuanians, Serbians, for example. So, again, everything that you knew from other markets and the research that you use and the data that you use to build up the business case is different because the international students in Poland have a different disposable income or price range that they can afford. So again, that affects your thinking, which also in terms of pricing, but also affects your thinking in terms of the product that you're building, the specification, etc. But they still have the same fundamental needs in terms of needing to study. You still want to give that consistency of brand promise across in terms of community.

35:15
Joe Persechino
And I suppose the principle that we try and adhere to at Yugo is the 9010 philosophy rather than the 80:20, which is 90% consistency, 10% variation due to local nuances, whether it's legislation or health and safety, whatever crops up in the local area, but trying to be as consistent as we can in our service offering. And that's how we hopefully so far have seen success and will continue to see success. If I look further afield then outside of Europe, the US is clearly a huge market. You know, we're currently about 18,000 beds. We'll be looking to double that shortly. But there's still huge opportunity because it's such a big market and, you know, we're only touching the sides really in terms of 18,000 bits.

36:08
Joe Persechino
There's a couple of big players out there that we're gunning for and we want to be number one in every market that we're in, if possible. And then outside of that, you know, there's still scope. We're the only, realistically, the only player in Dubai, for example. And there's a lot of effort going into attracting universities, campus offshoots, if you like, into Dubai. The government are very proactive and trying to attract some of the big names like Harvard and Yale and MIT to set up an offshoot campus. And, you know, we've already got an asset there. We've been trading there for over five years now successfully. And again, that was a different market because in that property we have segregation of male and female, for example, separate floors, separate blocks. So again, a learning curve.

36:59
Joe Persechino
And then for us it's, you know, I'm excited about APAC and growth in Australia and Japan, where we also have a presence. But again, it's that dual track strategy of new markets as well as scaling in the existing markets that we're in.

37:14
Kristian Lupinski
You guys sound super busy and so I appreciate you taking the time out today to be on the podcast with us, just hearing everywhere you're going. One note on Poland is I actually live and work in Poland. That's where I'm at now out of Krakow. And I can tell you that your direction to Poland is right on because there's a lot of tech companies moving to Poland. It's becoming like a huge tech center. You know, since Brexit, a lot of companies have moved over here because of the price of living, the price of the economy and it's a really, you know, if anybody's thinking about moving business to Poland, that's definitely a good place to do. So. I wanted we have two more subjects to talk about today and the next one is, you know, branding in student living.

37:58
Kristian Lupinski
Everything that you've been talking about and what you've been doing is all reflective of your brand. You know, why do you think brand matters so much in the student living space especially, you know, you're marketing to a generation that's incredibly brand savvy and digital connected.

38:12
Joe Persechino
I think you've hit the nail on the head there. You know, one thing that we've really focused on is our brand. And we launched the Yugo brand in 2021 because previous to that were a number of operating names. So we had Uni Nest, student housing company Nexo Residencias, for example, headquarters in Germany. And we felt that there was something missing in the sector. You know, we think of the great brands that are around and how well known they are and a lot of them stem from the US And I think it was a stark sort of revelation for us and for me when we entered the US that in real estate especially, but in student, brand didn't exist. The brand was the property. That's the brand. You advertise the property name but no company behind it.

39:16
Joe Persechino
So the large companies such as Scion or ACC didn't have a brand that students would recognize or would roll. Off the top of your, you know, off the top of your head, if you were having a conversation about student housing it would be I stayed at X building rather than with this brand. And for us it felt like a huge opportunity because as you said, Kristian, today's Gen Zs and Gen Alpha even more so. Moving forward, it's all about brand and brand trust. And for us that fits in with what I was touching on before in terms of brand promise is we want to be synonymous for giving a level of consistency and service and expectation to students.

40:00
Joe Persechino
No matter what country you're in, there should be a baseline of what we should be delivering to those students and what you can expect, what parents can expect, what students can expect, what universities can expect. And then the local nuances will vary on top of that, but it should be consistent everywhere, which is harder to achieve than you might think. But it's very important for us because, and it's very deliberate in terms of our positioning, that we say we are a global brand and operator and not just an operator. Because in our view, if you're just an operator, you're thinking it's a paycheck, effectively, you're thinking about how you're going to get paid your fees. Your focus is really on the performance of the asset from an NOI perspective. But for us it's more than that. It's more than just focusing on the asset.

40:57
Joe Persechino
Yes, that's absolutely important. We all need to be paid for the work that we do. But for us it's. It's a step further. And if I bring us back to my. One of my earlier points in terms of that transition from home living to independent living, effectively independent life and becoming an adult and maturing and learning and exposure to different cultures, etc. That's key for us. And that's part of we have, you know, three pillars of programming that we run internally, which many operators will say, we'll talk to you about the student experience.

41:32
Joe Persechino
Our aim is to go beyond that and effectively, it's almost called the Yugo movement, if you like, in terms of it's beyond just student experience and beyond providing or putting on events for students, barbecues or whatever that's run of the mill for us as part of our pioneering piece is how can we take that further? And we have three strong pillars which are around personal development, professional development and then sustainability. And we think that those are the three main topics that are important to students today. And we continue to reassess those as we continue to survey future students. And we program around that so that it's not just about putting on a nice barbecue with free beer. You know, it's more than university life should be. More than that.

42:19
Joe Persechino
You think that the cost of going to university has increased so much over the years. The whole thing, not just the accommodation, but also cost of going to university has increased. The pressures that puts on families. We've seen that it's not just the middle classes and the wealthy middle classes that are sending their children to university. And you know, the numbers we talked about before in terms of those numbers going up, it's also the lower economic eco socionomic groups that are coming through and they've been saving up for, you know, families have been saving up a hell of a long time to put their child to give through university, to give them the best opportunity possible in terms of getting the best education at the best establishments. So we have to be mindful of that.

43:11
Joe Persechino
And what we try and do is push programming beyond just the normal trivia night or movie night in a property, but actually, how can we help them become more employable, moving forward from a professional perspective? So, and again, it goes beyond just CV writing, but it's also giving them access to CEOs of different companies that can talk to them about resilience or talk to them about their career journey and the challenges they faced and how to overcome those and avoid pitfalls and almost be mentors, but offering webinars on that. And, you know, our partnership with VCarb in Formula One has been fantastic, where we've had access to some really great minds from both Red Bull, but also from the VCarB team to talk to us about their experiences. And, you know, we try to try and Pause. Sorry, Kristian, I'm missing a word there.

44:14
Joe Persechino
We try and correlate what they do as a business and you think Formula one is very much about being a highly honed machine. It's a matter of milliseconds that how quickly you change a tire. Everyone needs to know their role, needs to know how they fit into the bigger piece of the puzzle, or bigger part of the whole journey, if you like, of F1, and how people need to be resilient and they need to be, you know, they need the necessary skills to fulfill their part because they could be the one piece that lets everyone else down and could cost those tenths of a second to a team, which could ultimately cost them the race and points and funding, etc.

44:58
Joe Persechino
And being able to have someone from those businesses and those brands that can talk to students and pass that on and pass on, you know, the lessons they've learned and the mindsets that you need to have, you know, for us can only enhance what students are already learning at university and help them as part of their journey into the workforce because it is becoming more and more competitive and more students are going to university. More and more students want to come out with firsts and go to, you know, the top universities to make them more employable. Well, if that pool is getting bigger, you know, employers need to choose somehow what's the benchmark or what's the KPI for choosing from a wider pool.

45:48
Joe Persechino
You need to set new KPIs or new things that you're looking for and I think the more we can add to a student's cv, if you like, life cv, in helping them to secure better employment, whether that's through us and through our own internship program, which is part of the programming or through others, you know, we feel that we should be doing everything we can to help those students be successful. And, you know, I'd love to be sitting here saying that if you live with us, you will, you know, there will be a stat in the future, I'm sure, but if you live with us, you will be more successful than if you live somewhere else because of everything that we do as part of our programming.

46:29
Joe Persechino
So hopefully the next time, if I'm invited back on, I can share that stat because that would be a phenomenal stat that would certainly help our marketing and brand piece, but also help us with negotiations with universities, etc, and with. With councils and governments, local governments.

46:49
Jessica Gillingham
I hope you're putting metrics in place and really thinking about that because it would be, you know, really significant to be able to say that. And I just, you know, it's. So much has changed. I was just sort of thinking when I went to university, it was all about fun. It was like, you know, whether the bar was, like, big enough, you know, if it was open every night of the week and not just Friday and Saturday or something. It's all changed. And I have, as I've mentioned, I've got one at university and one who's choosing universities now. And there's so much pressure, but, you know, to have operators like yourself that sort of understand that and are providing, you know, helping, which is great. But, Jo, I have thoroughly enjoyed this conversation. We definitely want you back on.

47:36
Jessica Gillingham
And also I want to hear more about what it's like to operate in Japan, because that is a country you didn't mention. But, you know, going from Japan to Madrid to somewhere in the U.S. you know, it's a really interesting model that you guys have, but thank you so much for coming on the podcast and I know Kristian's just going to clear us out now.

47:57
Kristian Lupinski
Yeah, absolutely. There's one last question for you, Joe. Anything coming up for you guys or anything our audience should know if they're interested in finding out more about Yugo, where can they go?

48:07
Joe Persechino
So, as always, we are forever trying to pioneer and do new things. So there's some big things that are on the horizon, which I can't talk about just yet, but stay tuned for those. And then for anyone that's interested in getting in contact, they can either do that through LinkedIn I'm visible there, but also I'll be attending some conferences as I try and do throughout the year. I think the next one will be the Class Foundation Conference in November and then Property Week in December, so more than happy to catch up with anyone then as well.

48:47
Kristian Lupinski
That's brilliant. Joe, thanks so much for spending the time. Like this podcast has said, you are very busy person so we'll let you get back to it. But again, thanks for joining us.

48:57
Kristian Lupinski

And that wraps it up for today's episode of Pillow Talk Sessions. Thank you so much for joining us. And to stay connected and never miss a conversation, head over to pillowtalksessions.com to subscribe. You can also follow us on LinkedIn for more insights and interviews with leaders shaping the future of hospitality, multifamily living and community driven spaces. Pillow Talk Sessions is brought to you by Abode Worldwide, the strategic public relations agency for tech brands and tech enabled operators transforming the way we work, play and stay. Abode Worldwide creates category leaders and builds brand value across hospitality in modern rental living. Thanks again for tuning in and we'll see you next time on Pillow Talk Sessions.