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November 08, 2017  

Student-Housing Listings Keep on Coming

Another big student-housing portfolio is on the block.

The offering, valued at about $235 million, encompasses two nearly competed complexes and one that recently underwent a gut renovation. The owner, Haven Campus Communities of Atlanta, prefers to sell them as a package, but will consider bids on individual properties. Newmark has the listing.

The complexes, which have 917 total units with 2,237 beds, are adjacent to campuses of Texas A&M University, the University of South Florida and the University of North Carolina.

The estimated value translates to $256,000/unit and $105,000/bed. A buyer paying that price for the entire portfolio could expect a capitalization rate of roughly 5%, in line with the yield on new complexes at top-tier schools.

Student housing has experienced a boom in investment sales over the past few years. Some $10 billion of student housing traded last year, blowing away the $6 billion record set the year before.

The fourth quarter traditionally sees an uptick of offerings, as rent rolls for the academic year are locked in, making valuations more solid. But, as previously reported, there has been an unusually large cluster of portfolio offerings this year, addressing demand from buyers looking to scale up in a sector they view as safer than traditional multi-family properties.

The Haven Campus listing joins four larger portfolios already up for sale. Those portfolios — totaling more than 3,200 units and 9,000 beds — have a combined estimated value of $850 million.

The largest property in the new listing is Haven49, at 9200 University City Boulevard in Charlotte. The complex, valued at up to about $110 million, has 332 units with 887 beds. Construction is expected to finish next summer. A buyer would likely complete an acquisition once the final certificate of occupancy was issued.

Also under construction is Haven46, at 14500 North 46th Street in Tampa. It should have a final certificate of occupancy by yearend, although leasing is not expected to ramp up until the 2018-2019 school year. The property, valued at roughly $60 million, has 158 units with 542 beds.

Rounding out the offering is the Tradition, at 301 Church Avenue in College Station, Texas. That property, worth about $65 million, has 427 units with 808 beds. Following the renovation, the property re-opened this fall. The occupancy rate is 82%.

The complexes feature similar amenities, including wireless internet, resort-style pools, fitness centers and lounge areas.