Investcorp Expands US Student Housing Portfolio with $160M Acquisition

Global alternative investment firm Investcorp has acquired two student housing properties in the US for $160 million (€147.9 million).

Investcorp said the 914-bed assets at the University of Florida and the University of Texas at Austin further expand the company’s student housing portfolio and “reinforce the company’s position as a leading acquirer of one-time, non-portfolio student housing assets over the past two years.”

Michael O’Brien, Co-Head of US Real Estate at Investcorp, said: “These new acquisitions in the student housing sector exemplify our strategy of investing in high-quality, off-campus student housing in dynamic and growing university towns.

“Investcorp was an early mover in the student housing market 12 years ago, and we remain confident in the sector given strong secular factors and continued strong fundamentals, including continued enrollment growth, limited new on- and off-campus offerings, and relative resilience to market cycles.”

Investcorp’s real estate portfolio in the US consists primarily of industrial and residential properties, accounting for 98% of its total holdings. Since the company began investing in student housing, it has owned and managed more than 16,500 beds in 25 student housing investments.

O’Brien added: “Our national student housing portfolio is 99% occupied for the 2023-2024 academic year, and new additions to the University of Florida and the University of Texas at Austin appear to be significantly above market averages in terms of initial occupancy for the 2024-2025 academic year.”

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Ryan Bassett, Head of Residential Acquisitions at Investcorp, said: “Our acquisition activity in student housing over the past two years demonstrates our ability to invest capital in high conviction strategies at a time when many other investors are remaining on the sidelines.

“We continue to be very selective across markets, asset quality and business plans, and have taken advantage of this disruption to introduce more attractive valuations and lower risk strategies.”

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