No commercial real estate sector is recession-proof, but sectors like student housing are more resistant to economic downturns than others. Core Spaces managing director Marc Lifshin—whose firm has 12,000 beds in the pipeline in college markets like Ann Arbor, MI, Tempe, AZ, Minneapolis, MN, and West Lafayette, IN—shared his tips for smart student housing investment.
Marc says he looks at three key metrics for entering a market: enrollment growth; the need for student housing in a particular market; and the availability of land to properly develop student housing. If you can check off those three items, today's investment landscape will provide plenty of capital to fund a student housing development.
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Those three metrics can almost always be found in markets containing Tier 1, state-run universities. Marc says Core Spaces has plenty of success in these markets with its Hub on Campus line (pictured, Hub on Campus' Madison, WI, development). These schools want to limit the amount of student housing on their balance sheets, so they're turning more frequently to public-private partnerships and issuing RFPs for developers to build on their dirt. University officials recognize firms like Core Spaces have an ability to market housing to incoming students that isn't available in-house.
Marc says urban Tier 1 markets pose a different risk profile because student housing is competing with non-student housing, but the best product will always attract customers. Marc considers Core Spaces' Hub on Campus project in Eugene, OR, near Portland State University, to be just another high-end apartment building, regardless of the tenant type.
Marc's building isn't limited to student housing. He formed the charity Camp Out For Kids in 2008 and has raised over $800k and funded the summer camp trips of 2,000 kids across the country. A fundraiser for Camp Out For Kids is being held Dec. 1 at Fremont, 15 West Illinois St in Chicago.
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