Dive Brief:
- Last month, Investcorp announced that it acquired four student housing properties totaling nearly 3,000 beds for more than $300 million.
- The Bahrain-based global alternative investment firm said the acquisitions boost its strategy to build a diversified portfolio of off-campus housing at flagship state universities across the country.
- Investcorp’s acquisitions include a 792-bed asset at Texas A&M University in College Station, Texas; a 486-bed community at Texas State University in San Marcos, Texas; a 699-bed property at the University of Kentucky in Lexington, Kentucky; and a 684-bed building at the University of Oklahoma in Norman, Oklahoma.
Dive Insight:
Investcorp is one of a number of high-profile firms making bets on the student housing sector in 2024. In November, The Scion Group and a major institutional investor, later identified by Bloomberg as Brookfield, paid $893 million for 14 communities.
Also in November, Providence, Rhode Island-based Gilbane Development Co. entered a strategic real estate partnership with New York City-based CBRE Investment Management for a portfolio of six student housing properties, three in operation and three under development.
In April, KKR and Blackstone Real Estate Income Trust, both based in New York City, announced that KKR funds would acquire a portfolio of 19 purpose-built student housing properties from BREIT for approximately $1.64 billion.
Like other firms that acquired student housing in 2020, Investcorp likes the sector's fundamentals and risk-adjusted returns.
“Many of the top university markets face shortages of housing and, when combined with growing enrollment, this creates favorable operating dynamics, which support our long-term conviction in the asset class,” said Michael O’Brien, global co-head of real assets for Investcorp. “These dynamics are helping to drive sustained and rising demand that reinforces our long-term conviction in the asset class.”
Investcorp, which invests primarily in the industrial and residential sectors in the U.S., has owned and managed approximately 20,000 beds across roughly 30 student housing investments.
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