Investcorp Expands U.S. Student Housing Portfolio with Acquisitions at the University of Florida and University of Texas at Austin

11 Jul 2024

Investcorp, a leading global alternative investment firm, today announced that it has acquired two student housing properties totaling 914 beds at the University of Florida and the University of Texas at Austin for $160 million gross purchase price. These acquisitions further expand the firm’s high-quality student housing portfolio and reinforce the firm’s position as a leading acquirer of one-off (non-portfolio) student-housing assets over the last two years.

Importantly, both the University of Florida in Gainesville and the University of Texas at Austin are ranked in the top 10 of public universities nationally in terms of academic quality and enrollment, according to U.S. News & World Report. This, combined with the desire among students to attend college in good-weather states, is expected to continue to drive enrollment and population growth to sustain long-term demand on these two campuses.

Michael O’Brien, Co-Head of Real Estate United States for Investcorp, said, “These new student housing acquisitions exemplify our strategy of investing in high-quality off-campus student housing in dynamic and growing college towns. Investcorp was an early mover into student housing 12 years ago, and we continue to have high conviction in the sector due to strong secular tailwinds and consistently strong fundamentals including continued enrollment growth, limited pipelines of new supply on- and off-campus, and relative resiliency through market cycles. Our national student housing portfolio is 99% occupied for the 2023/2024 academic year, and these new acquisitions at the University of Florida and the University of Texas at Austin appear to be far outpacing market averages in pre-leasing for the 2024/2025 academic year. We look forward to advancing our position as one of the nation’s most active acquirers of student housing as compelling investment opportunities arise.”

Ryan Bassett, Investcorp’s Head of Residential Acquisitions, said, “Our student housing acquisition activity over the last two years highlights our ability to deploy capital into high-conviction strategies at a time when many other investors remain on the sidelines. We continue to be highly selective on markets, asset quality and business plans, and have taken advantage of the dislocation with more attractive valuations and lower risk strategies. The University of Florida asset is a brand-new Class-A+ property that was delivered in October 2023 and benefits from an unparalleled location directly adjacent to campus. The University of Texas at Austin asset was built in 2013 and is located within proximity to campus. Both investments feature light value-add business plans that will be executed in the near term.”

Since 1996, Investcorp has acquired over 1,300 properties for a total value of over $25 billion. Investcorp’s U.S. real estate strategy invests primarily in the industrial and residential sectors and today 98% of the firm’s U.S. portfolio consists of these property types. Since the firm began investing in student housing, it has owned and managed more than 16,500 beds across 25 student housing investments. According to Real Capital Analytics, Investcorp is among the top-5 largest cross-border buyers of U.S. real estate over the past five years, and the real estate team recently ranked number 51 on PERE’s PERE 100, one of the most prestigious listings of top real estate equity investment managers in the industry.