Student Housing Sector Gets Fresh Investment
As university students across the U.S. hunker down in their dorms and apartments to study for midterms, investors are forming partnerships and making deals to capitalize on those buildings.
Inland Investments on Tuesday announced a new partnership with The Scion Group, the biggest owner-operator of off-campus student living, to operate off-campus, purpose-built student housing assets. The duo’s focus will be top-tier U.S. universities.
Inland’s portfolio, worth $1.7B, includes 10,000 beds across 19 nationwide properties, and it is looking to grow that footprint, according to a press release.
Similarly, student housing operator Yugo has grown its operations with last month’s acquisition of Campus Advantage. The deal added 88 properties totaling 40,000 beds in 28 states to its portfolio.
Preleasing at student housing was 93.7% in August, 200 basis points higher than the year prior. But rent growth is slowing, clocking 1.1% year-over-year in August as new supply has increased competition.
Despite declining enrollment — and a projected 30% to 40% fall in international student enrollment in future years because of Trump administration policies — private fixed investment in student housing rose 0.3% in September, building on growth in the second quarter, the National Association of Home Builders found.
Capital markets activity in the sector has been steady, though sales have dipped slightly. September logged 71 investment sales, Yardi Matrix found. That is down from 86 properties sold last September, a number skewed by one megadeal in 2024.
Despite the slowdown in buying and selling, things didn't come to a complete stop.
Liberty Mutual Investments and Landmark Properties in September teamed up to purchase and develop 1,255 student housing beds across two projects at Pennsylvania State University and the University of Connecticut.
Also in September, a $190M University of Michigan off-campus student housing property went up for sale from developer Morningside Group. The 706-bed building is the largest single-asset student housing listing since 2023, according to Green Street.
Investment in the sector is in a much better place after a pandemic-fueled slowdown, when funding went from $4.4B in the fourth quarter of 2019 to $3B in the second quarter just two years later.
