Chicago's Largest Student Housing Project Has A Buyer
University Center, Chicago's largest student housing project with 1,729 beds shared between three colleges, has a buyer. Blue Vista Capital Management has agreed to buy the superdorm at 525 South State for over $200M, according to Crain's Chicago Business. That would be the highest price ever paid for a Chicago-area student housing development.
University Center, owned by a nonprofit formed by DePaul University, Roosevelt University and Columbia College Chicago, built the 18-story building for $150M in 2004, well before student housing was on the radar of investors. When the building went on the market last September there were some concerns that declining student enrollments at the three schools would limit buyer interest. And students choosing to live downtown have a wider range of rental options in today's South Loop and downtown markets.
But there was reason for optimism. Harrison Street bought the 771-bed Dwight Lofts at 642 South Clark two years ago for $105M, and a JV of Atlas Real Estate Partners, Marc Realty and Angelo Gordon sold 777 South State St. for $85M in September 2015.
University Center's construction was financed with $127M in bonds and the three schools would need to pay that off before seeing cash from the deal. Blue Vista is a savvy student housing investor. Co-founder Robert Byron told Bisnow last year the sector is virtually recession-proof.