CLEMSON, S.C. AND KNOXVILLE, TENN. — Arcapita, a global investment manager with offices in Atlanta, London and Singapore, has acquired two student housing communities in the Southeast for a combined $120 million.
Clemson Lofts is a 640-bed community located approximately one mile from Clemson University in South Carolina that was fully occupied at the time of sale. Quarry Trail is an 840-unit property serving the University of Tennessee in Knoxville.
The properties were acquired in separate transactions, with the sellers in each deal opting to remain anonymous.
Clemson Lofts features one-, two-, three- and four-bedroom units. The property’s amenity package was recently expanded and upgraded and now includes a pool, fitness center, dog park, group and private study rooms, outdoor yoga space, indoor gaming lounge and a resident clubroom with TVs.
Quarry Trail also offers one-, two-, three- and four-bedroom floor plans that feature full-size washers and dryers and private patios in select units. Communal amenities include a new dog park, fitness center, pool and study areas, as well as a resident clubhouse and shuttle service to campus.
Arcapita says it is bullish on the student housing sector and intends to aggressively pursue deal opportunities in 2021. In particular, Arcapita plans to target properties that serve universities with more than 10,000 undergraduate students and that are located within one to three miles of campus, as these properties have “demonstrated a level of acceptance among the student body due to their value-for-money proposition.”
The firm cites students’ overwhelming preference for learning and living on campus and a shortage of purpose-built student housing communities as the cornerstones of its investment philosophy.
“Purpose-built student housing currently represents less than 25 percent of the overall student housing market, and we expect this ratio to increase over time to cater to evolving student preferences,” says Brian Hebb, managing director at Arcapita. “The demand for purpose-built student housing has grown over the past few years due to the provision of amenities that are valued by students such as direct shuttles to campus, group study facilities, and activity centers.”
“Our investments in student housing are a further extension of our focus on defensive sectors that are supported by long-term trends,” adds Martin Tan, chief investment officer at Arcapita. “With over 20 million university students and less than 1 million purpose-built student housing beds, the U.S. student housing industry is in its early stages of supply and has the potential for considerable growth.”
— Taylor Williams