Last year, distance learning stunted student housing activity—but the economic recession is restoring confidence in the asset class. Recessions historically drive student housing demand as more young people elect to continue with school rather than entering the workforce. As schools reopen, student housing demand is returning and restoring confidence in the asset class.

Pierce Education Properties is one investor that is bullish on the asset class. The company never lost confidence in student housing, despite the market disruption. Last year, the firm acquired $100 million in student housing assets, and it plans to remain a net buyer again in 2021. "The pandemic has reinforced the recession-resistant nature of the asset class and has also demonstrated that student housing can succeed even when feeder universities are imperiled," Frederick W. Pierce, president and CEO, tells GlobeSt.com. "While overall university enrollments were down 2.5% in academic year 2020-21 according to National Student Clearinghouse, enrollments at four-year public universities were level."

This year, the firm will focus on core, core-plus and value-add student housing properties near top tier universities. Specifically, it will focus on properties with 20,000 or more undergraduates with a Power Five football conference or Group of Five football conference. "The only operators who were hit hard during the pandemic either had properties at second tier universities where enrollments continue to decline or had on-campus student housing where they were forced by universities to release students from housing contracts and send them home or reduce occupancy in AY 2020-21," he says. "Off-campus student housing did not release residents from leases and the performance was consistently strong irrespective of course delivery method by the university."