Universities should cram more students into less space to cut costs, according to the Higher Education Funding Council for England.
Its annual review of estates management concludes: "A question for many institutions is whether a significant reduction in the amount of space could help to finance improvements in quality."
The survey found that some institutions squeezed each student into 7 square metres of non-residential space while others allowed almost 13 square metres. The review says: "There is significant potential to improve the use of space through better management and awareness."
As an example of good practice, the report highlighted Royal Holloway, University of London, where most of the teaching space has been brought into a central pool of timetabled space that lecturers can book using the intranet. This more efficient allocation of teaching space has allowed office space to be created in former teaching rooms and the number of staff has expanded without the college having to build new accommodation.
Andrew Wathey, vice-principal for planning and resources, said: "Royal Holloway has been able to bring the majority of the teaching areas into a shared booking system. This has made it possible to give shared ownership of space and removed some inefficiencies."
As well as variations in the use of space, the survey found that in the UK, one-third of university buildings still needed significant repairs at a cost of more than £3 billion - despite an overall improvement in the general condition of the estate. Even more money would be needed to modify buildings to ensure they meet the current demands of teaching and research.
Some 8.6 million square metres of space is in poor condition. This would correspond in an efficient system to teaching space for as many as 860,000 students.
Almost one-quarter of non-residential space was more than 60 years old while, in the past year, the cost of residential space increased by 12 per cent per bed.
The survey forms part of the funding council's estates management statistics programme, which allows each institution to compare the state of its buildings with up to 20 self-selected peers.