Atlanta — The year is off to a blazing start for student housing investment sales — at least on the listings front. A number of sellers brought portfolios to the market in January, well ahead of past years.
Included in those listings is a 10-property “top tier institutional portfolio” brought to market by the National Student Housing group at CBRE. Along with those properties, several portfolios of two to five assets have been brought to market.
“Properties this year have come to market ahead of when we normally see them,” says Jaclyn Fitts, director of student housing for CBRE. “We usually see more properties come to market in the summer and fall after pre-leasing is done; this year we are seeing them earlier. The properties coming to market are being driven by reasons other than lease-up, like portfolio reallocation or upcoming financing deadlines.”
Among the assets that CBRE is marketing are a five-property portfolio in Texas and Oklahoma positioned as value-add opportunities. CBRE also has a five-property, non-purpose built portfolio in Valdosta, Georgia, listed as a single-market attraction.
“In general, there is a mishmash of value-add and institutional assets on the market right now,” says Peter Katz, executive director of IPA, who, like Fitts, did not offer direct comment on any of the portfolios, but did discuss the investment market conditions. “Whenever that happens, you see buyers wanting to cherry pick assets from the portfolios, so it will be interesting to see what sells in the near future.”
The properties in the CBRE marketed institutional portfolio are, according to research, owned by a joint venture of the California State Teachers Retirement System (CalSTRS) and Campus Advantage, who operates the properties. According to sources, there is a also a multiple-asset portfolio reportedly from Blue Vista and GIC that has been divided and listed among several brokers.
On the buy side, new groups entering the space want to be able to quickly acquire assets that make sense for their strategies, whether that is through value-add or stabilized properties, and investment sales executives report much interest in the assets on the market.
“We’ve seen a lot of buyers seeking the ability to build bulk in the student housing space quickly,” says Fitts.
The listings promise an active year for the investment sales industry, which saw a record set in the sector in 2015.
— Randy Shearin