TALLAHASSEE: The Price is Right
A 936-bed student housing development at Florida State University (near Tallahassee Community College) just sold for $24M. The proud new owner: VerTex Student Housing Partners, a JV of Chicago's Vermilion Development and Dallas' TEXLA Housing Partners—its third deal in partnership with Harrison Street Real Estate Capital. With an overall basis of just under $30k/bed (well below replacement cost), the 2004-built property, known as The Boardwalk at Appleyard, allows VerTex to offer competitive rents, TEXLA CEO Roger Phillips tells us.
The deal took about 18 months to close, he says, since more investors have eyes on student housing, especially larger properties in Tier 1 markets like Tallahassee. Renovations, including a rebrand to University Trails Tallahassee, exterior work, and furniture upgrades, will go on in phases through next summer. Must-haves for students these days include a 1:1 bed/bath ratio, lightning-fast WiFi, and a broad suite of amenities including billiards and a pool, Roger says. (Perfect for when you're in the pool and need to surf the web.)
VerTex’s value-add student housing platform now owns 3,000 beds and $100M of assets (at University of Mississippi, Kentucky, Texas A&M, and more). It’ll stay focused on growth states in the Southeast and Southwest, Roger tells us, hopefully picking up two assets a year. (That means Tier 1 schools from the Carolinas to Texas, where there are more college kids than convenience stores on every street corner.) Roger was swamped with colleges last month, between closing this deal and watching one of his kiddos graduate from UT-Austin.