Student Housing: An Institutional Asset Class Driving Rent Growth

Student Housing as an Institutional Asset Class

• 💡 Student housing is increasingly recognized as an institutional asset class, attracting significant capital investment.
• 📈 Despite a general decline in college enrollment, fundraising for student housing reached $20 billion in the first half of the year, the highest in a decade.
• 🎓 This growth is concentrated in state and elite private schools, which continue to see increasing demand and enrollment.

Factors Driving Rent Growth

• 🏗️ Strong rent growth, up 6% year-over-year, is attributed to limited new supply of student housing, although new construction is starting to ramp up.
• 🔑 Financing for new developments is becoming more attainable, leading to increased construction and redevelopment.

Evolving Student Expectations and Amenities

• 🛋️ Today's students expect a higher level of finishes and amenities, including fully furnished units where residents only need to bring personal items.
• 🏊‍♂️ Premium amenities such as lazy rivers, tanning beds, jacuzzis, upscale fitness centers, contemplation spaces, and fire pits are becoming standard.
• 💻 The most critical amenity for students is high-speed internet, essential for both academic work and leisure.
• 📍 Proximity to campus and convenient on-site facilities are key factors influencing student housing choices.