A New Student Housing JV Launches

Inland Private Capital Corp. and Core Spaces have launched a strategic joint venture targeting purpose-built student housing at top-tier universities across the US.

The venture will target ground-up and substantially complete off campus purpose-built student housing opportunities, the companies said in a statement. It will also mark the beginning of IPC’s strategic plan to expand its student housing footprint, which currently stands at 3,800 beds across seven campuses. Core Spaces currently owns and/or manages 44 student housing properties nationwide with a total of more than 22,000 beds, with an additional 40,000 beds and units in the pipeline.

“We are thrilled to partner with Core Spaces, a proven leader and innovator in the student housing industry,” said Keith Lampi, president and chief operating officer of IPC. “The strategic relationship provides our platform institutional access to best-in-class student housing opportunities – an investment category that has historically demonstrated predictable and stable performance, even during times of economic volatility and most recently throughout the COVID-19 pandemic.”

The student housing sector has shown resiliency throughout the pandemic and has mostly recovered from its pre-pandemic slide, according to the most recent numbers from Yardi Matrix. Across 200 schools, preleasing for next fall was recorded at 63.7 percent—13.5 percent higher than the same time last year and 9.9 percent higher than March 2019.

The average rent per bedroom is $777 for fall 2022, an increase of nearly three percent compared to the year earlier.

Stephen Shockey, senior manager of portfolio risk and operations at Alliant Credit Union, told GlobeSt.com in an interview in late April that despite reported reductions in enrollment at some schools, the overall industry continues to show positive trends.

“Investors seeking alternatives to conventional multifamily have found student housing an attractive investment option; sales volumes continue to increase and cap rates continue to compress; however, returns on student housing continue to outpace those achieved in the multifamily sector,” Shockey said.