NEW YORK CITY-While strong fundamentals, rising rents and attractive construction costs are all driving the boom in the multifamily market, many residential real estate investment trusts are beginning to seek out opportunities beyond traditional core markets.

During NAREIT’s REIT Week Investor Forum on Tuesday morning, William C. Bayless, Jr., president and CEO of Austin-based American Campus Communities, Inc., a student housing REIT worth $4.8 billion, said privatization of on-campus student housing is becoming a new trend in the industry, even among major public institutions and the Ivy League. “It has become mainstream,” he said. “When you think of colleges and universities looking toward the private sector for assistance, historically, the Ivy League and premier flagship institutions were very proud of their own internal abilities in terms of delivering real estate and capital assets. And that has evolved, given financing limitations. Even the wealthiest institutions have said, if there are companies that have a core competency that can help us deliver better market-based products more cost-effectively and more efficiently, then we should not waste our own precious dollars.”

Bayless said Princeton University selected ACC to assist with the redevelopment of the university’s Hibben-Magie Apartments, a 192-unit complex constructed in 1962 that will be repositioned to house between 475 to 625 graduate students. “To have Princeton engage someone like American Campus, where we come in, being that we do this day and day out for a living, do market research and run the entire process and spend every dollar as though you are going to own it,” he said. “Princeton is expected to break ground on the transaction this summer, and from their assessment, ACC is developing the building between 75% and 80% of what the university would have spent without us.”