The Invercargill City Council will meet to consider investing in apartment accommodation for Southern Institute of Technology students, Mayor Tim Shadbolt says.

The council has advertised its plans to hold a public excluded extraordinary council meeting on March 30 to discuss investment opportunities.

The meeting was for the council to consider investing in student apartments, Shadbolt said.

Invercargill had a shortage of suitable accommodation for students and more was needed, he said.

"It's desperate. Some of them are in motels apparently. The apartments have all overflowed."

The Southland Regional Development Strategy aims to increase Southland's population by 10,000 by 2025, and more international students are being targeted to help reach that goal.

"We have got to try and get overseas students and that means more student accommodation," Shadbolt said.

Lots of effort went into ensuring overseas students were looked after when they arrived in Invercargill and that included ensuring they were housed in good accommodation - not damp and run-down homes, Shadbolt said.

If the proposal gets the nod, the initiative was likely to be spearheaded by the council and SIT, and partners would be sought, Shadbolt said.

A range of options had been put to the council to consider at its March 30 public excluded meeting, including the budget.

"I won't be attending the meeting because I have got a conflict of interest because I do so much work for the SIT," Shadbolt said.

Councillor Ian Pottinger said a lot of information had been made available to councillors about the issue.

It was the second time the council had looked at it; the first time there was insufficient information to make a decision, Pottinger said.

"I have got an open mind."

A spokeswoman for SIT chief executive Penny Simmonds said she had no comment at this time.

The agenda for the city council's February meeting says Simmonds was to make a presentation to councillors at that meeting. The topic of the presentation was not revealed in the agenda and the public was excluded on the grounds it would enable the council to carry on negotiations without prejudice or disadvantage.

Professionals property management manager Tom Dymond confirmed there was a shortage of rental accommodation in the city for people across the board, not just SIT students.

"At any one time we have probably got only half a dozen houses empty ... this year especially it's been quite tight."

SIT students liked to live in properties within walking distance of the institute and they wanted warm homes to combat the city's chilly climate, he said.

Southland Real Estate spokesman Gus Johnston also said there was a shortage of rental accommodation in Invercargill.

The students who did not have vehicles wanted to live near the SIT.

There were not many residential properties located around Invercargill's central business district, he said.