Texas Student Housing Boom; Deliveries Skyrocketing Statewide
Texas has seen the most off-campus student housing supply delivered in the last 20 years and steady increases in supply are expected across the state. That’s why we’re excited to bring you Bisnow’s Texas Student Housing Summit on July 7 at the JW Marriott Austin (7:30am start).
Off-campus student housing properties in Texas are seeing strong leasing velocity and moderate rent growth averages, despite 4,600 off-campus beds delivering this fall, says event keynote speaker and Axiometrics student housing research analyst Taylor Gunn (far left, with colleagues at Axiometrics' 20th anniversary party). Taylor says she’s seeing some Texas markets trend above the national average (based on May data). On a same-store basis, student housing properties in Texas saw an average pre-lease of 81% and annual effective rent growth of 3%.
Among the top 15 universities for new supply this fall nationally are Texas A&M with 1,310 off-campus beds and Texas State University with 1,464 new beds. (Texas State's director of housing and residential life Dr. Rosanne Proite will also be speaking at the event.) Texas State has a 191k SF, 598-bed student housing project under construction (pictured). Consisting of two residence halls, the project should be ready by fall 2016.
HFF senior managing director/co-head of the Austin office Doug Opalka (another panelist) is impressed by the diversity and depth of capital in the student housing sector today and believes the industry is at the doorstep of another expansionary period. Student housing has seen dramatic modernization and innovation over the last 20 years, he says, which has attracted larger and more sophisticated sources of capital. That's particularly obvious with the continued growth of student housing dedicated REITs, but there are also pension funds, private equity advisers, life insurance companies and foreign capital entering the space.
Doug and his student housing focused HFF colleagues around the country have completed $725M of student housing investment sales, acquisition financing, JV equity, construction financing and refinances so far this year, and Doug tells us he expects more velocity in the sector in the second half of the year and into 2016.
American Campus Communities has been improving its portfolio through dispositions, says CEO Bill Bayless (our panelist is pictured with wife Jamie). YTD, ACC has sold 17 non-core assets for $405M. Most recently, it sold a seven-property portfolio in May for $174M. Those communities (over 5,000 beds total) average 1.1 miles from campus and nearly 20 years old. The proceeds are being spun back into development (the 2015 pipeline is $314M) and acquisitions ($165M of core purchases so far this year). The new buys average only 0.1 miles from campus and one year old. Join us for Bisnow’s Texas Student Housing Summit on July 7 at the JW Marriott Austin starting at 7:30am. Sign up here!
