GAINESVILLE AND TALLAHASSEE, FLA. — The Collier Companies and Madison International Realty have formed a joint venture to acquire a two-property portfolio of student housing developments in Florida valued at roughly $125 million. Jones Lang LaSalle’s Capital Markets arranged the joint venture partnership, led by Executive Vice President James Tramuto, and Managing Directors Jubeen Vaghefi and Denny St. Romain..
“This joint venture is a great real-time example of a trend that we have been seeing in the student housing market for quite some time, which is new institutional capital coming into the space with an appetite for quality product and quality sponsors,” Tramuto said. “This is Madison’s first investment in the student housing space, and while the returns and asset quality were certainly attractive selling points, the overwhelming drivers for the company’s investment in a new asset class were the strength of the sponsor and the ‘student housing story.’”
The Enclave, which is located adjacent to the University of Florida campus and just 10 minutes from Santa Fe College in Gainesville, is a Class A, 531,360-square-foot property featuring 412 units (pictured at right). The development comprises 13 buildings with 1,076 beds. As of fall 2010, The Enclave was 97 percent occupied.
Seminole Grand is located approximately 1.5 miles from Florida State University in Tallahassee, less than six minutes from Tallahassee Community College and nine minutes from Florida Agricultural and Mechanical University. The 557,640-square-foot property features 1,554 beds in 486 apartment homes throughout 36 buildings. As of fall 2010, Seminole Grand was 98 percent occupied. Both properties were renovated in 2008.
Freddie Mac provided $86.7 million in debt for the portfolio, while Madison International Realty, through the vehicle of a joint venture partnership, acquired an 80 percent interest in the existing ownership entity. The senior mortgage loan on Seminole Grand is a $44.85 million fixed rate loan at 5.17 percent, with a seven-year term and one year of interest-only amortization. The senior mortgage loan on the Enclave is a $41.86 million fixed rate loan at 5.16 percent, also with a seven-year term and one year of interest-only amortization.
The Collier Companies is based in Gainesville, Florida, and is currently the second largest student housing owner in the country, boasting a portfolio of more than 22,000 beds that are currently 95 percent occupied.
— Dan Marcec