Three Local Colleges Hope For Solid Return On 'Superdorm'
The three schools that teamed up to build Chicago's largest student housing complex have retained CBRE to market it for potential buyers. DePaul University, Roosevelt University and Columbia College Chicago built University Center at 525 South State St in 2004 at a cost of $150M. Since then, student housing has become big business and the schools could see a good return on that investment.
University Center houses 1,729 beds, making it easily the largest dorm in the city and one of the largest in the country. But concern over declining enrollments at the three schools could turn some buyers away, Crain's reports. DePaul, Columbia and Roosevelt each commit to a select number of beds each school year but reduced demand and more student housing options downtown led Fitch's to place a BBB+ rating and a negative outlook on the bonds.
There is reason for optimism, however. Harrison Street bought the 771-bed Dwight Lofts at 642 South Clark last year for $105M, and a JV of Atlas Real Estate Partners, Marc Realty and Angelo Gordon sold 777 South State St for $85M last September. Downtown is home to 38,000 full-time college students, so any buyer of University Center can find a way to fill the empty beds. Another incentive for buyers: DePaul, Roosevelt and Columbia are willing to sign a long-term master lease on the building. [Crain's]