US: Private equity giant KKR & Co has sold seven US student housing properties, totalling 4,500 beds, to Harrison Street for $725 million.
Compared with apartments, student housing offers higher returns as measured by capitalisation rates, according to MSCI Real Assets. “As cap rates of traditional multifamily assets push to new record lows, the relative yield opportunity offered by student housing may further pique investor interest,” it said in a June 22 report.
US student housing deal volume jumped 121 per cent in Q1 2022 from the previous year to $2.4 billion. In April, Blackstone agreed to pay $12.8 billion for American Campus Communities, the largest college housing landlord in the US with 111,900 beds. That transaction is scheduled to close in September.
Harrison Street is one of the largest US student housing landlords, with a portfolio of 97,000 beds valued at $11.8 billion as of March 31. It has been an active trader, selling two portfolios in November valued at $1.9 billion.
KKR has acquired 10,000 student housing beds for $1.2 billion since 2016. It manages student housing through its portfolio company University Partners.
