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Danehurst Secures £18m Refinancing for Edinburgh Student Scheme

Student accommodation developer Danehurst has completed an £18 million refinancing of The Pepper Mill, a 155-studio purpose-built student accommodation (PBSA) development in Bonnington, Edinburgh. The refinancing facility was provided by Secure Trust Bank Real Estate Finance at 63% loan-to-value, with an initial term of 15 months.

The Pepper Mill reached practical completion in time for the 2025/26 academic year. The scheme offers studios across multiple floors and includes communal facilities such as a lounge, gym, library, cinema room, and games room. Danehurst’s PBSA portfolio also includes developments in Southampton and previously in Egham, Surrey.

Edinburgh Student Accommodation Market

The refinancing comes as Edinburgh faces significant pressure in its student accommodation market. According to research from Student Crowd in March 2026, there are 23,109 PBSA beds in the city against an estimated demand of 41,325, resulting in a shortfall of over 18,000 places. Planning constraints are expected to limit future supply.

Edinburgh’s City Plan 2030, which took effect in November 2024, introduced restrictions capping studio apartments at 10% of the unit mix in PBSA developments. Construction on The Pepper Mill began before these regulations were implemented. The policy change is part of broader regulatory adjustments affecting Scotland’s property market, as local authorities introduce stricter development guidelines.

Transaction Details

This transaction marks the second deal between Danehurst and Secure Trust Bank since 2021. The deal was led by Richard Lynn, senior relationship director, and James Reeves, relationship manager at Secure Trust Bank. The 15-month refinancing term provides flexibility for Danehurst as the PBSA sector continues to attract institutional investment, despite tightening planning regulations in major university cities.

The developer has not disclosed future plans for The Pepper Mill.