Entering text into the input field will update the search result below

Student Housing REITs: It's Not Goodbye, It's See You Later


  • Student housing has seen a swift recovery and brightening outlook over the past twelve months as the effects of soaring rents have more-than-offset ongoing COVID issues and longer-term enrollment headwinds.
  • American Campus - the first of three student housing REITs and last one still publicly traded- was scooped-up last month by Blackstone - one of its five major REIT acquisitions since June.
  • Given the abundance of private institutional capital targeting student housing assets and prior acquisitions of EDR and Campus Crest, in January, we projected a potential takeout of ACC at $65/share.
  • Blackstone's $12.8 billion takeout at $65.47/share bid - nearly spot-on with that call - is a healthy 14% premium to ACC's prior close. These massive acquisitions have become necessary to feed its fledging non-traded REIT business, BREIT.
  • BREIT has grown into a $100B behemoth in less than five years despite its high fee structure, capitalizing on investor interest for private real estate, and a questionable perception of lower volatility compared to public REITs.
  • Looking for a helping hand in the market? Members of Hoya Capital Income Builder get exclusive ideas and guidance to navigate any climate. Learn More »

Friends at college dorm room

svetikd/E+ via Getty Images

This is an abridged version of the full report published on Hoya Capital Income Builder Marketplace on April 30th.

REIT Rankings: Student Housing

Student housing has seen a swift recovery and brightening outlook over

Read The Full Report on Hoya Capital Income Builder

Income Builder is the premier income-focused investing service on Seeking Alpha. Our focus is on real income-producing asset classes that offer the opportunity for reliable income, diversification, and inflation hedging. Get started today with a Free Two-Week Trial and you can take a look at our top ideas - including our new Landowner Portfolio - and see what we're investing in to help build sustainable portfolio income.

Members gain complete access to our investment research and our suite of trackers and exclusive income-focused portfolios targeting premium dividend yields up to 10% across real income-producing asset classes. 

This article was written by

Hoya Capital profile picture

Alex Pettee is President and Director of Research and ETFs at Hoya Capital. Hoya manages institutional and individual portfolios of publicly traded real estate securities.

Alex leads the investing group Learn more.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of RIET, HOMZ, ACC either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Hoya Capital Real Estate ("Hoya Capital") is a research-focused Registered Investment Advisor headquartered in Rowayton, Connecticut. Founded with a mission to make real estate more accessible to all investors, Hoya Capital specializes in managing institutional and individual portfolios of publicly traded real estate securities, focused on delivering sustainable income, diversification, and attractive total returns. A complete discussion of important disclosures is available on our website (www.HoyaCapital.com) and on Hoya Capital's Seeking Alpha Profile Page. Nothing on this site nor any published commentary by Hoya Capital is intended to be investment, tax, or legal advice or an offer to buy or sell securities. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and should not be considered a complete discussion of all factors and risks. Data quoted represents past performance, which is no guarantee of future results. It is not possible to invest directly in an index. Index performance cited in this commentary does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. Investing involves risk. Loss of principal is possible. Investments in companies involved in the real estate and housing industries involve unique risks, as do investments in ETFs, mutual funds, and other securities. Please consult with your investment, tax, or legal adviser regarding your individual circumstances before investing. Hoya Capital, its affiliate, and/or its clients and/or its employees may hold positions in securities or funds discussed on this website and our published commentary. A complete list of holdings is available and updated at www.HoyaCapital.com.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (10)

Hoya Capital profile picture
Hi everyone - Thanks for reading this article and hope you found it helpful!

If you enjoyed this article, hit the “Follow” button above or click the “Like” button to support our team’s work.

The full version of this article is available on Hoya Capital Income Builder – our Marketplace service through Seeking Alpha - which includes actionable content including valuation metrics, risk ratings, and access to our income-focused portfolios comprised of our highest-conviction ideas across each property sector.

We’re offering our readers a completely Free Two-Week Trial to come take a look around: seekingalpha.com/...

Thanks and let us know if we can help with anything!

Alex Pettee, CFA
So no more student housing REIT available for public trades?
SMRT profile picture
30 Dec. 2022
wondering if the same could happen in Europe, (that is, private capital chasing student housing). One to consider: Xior Student Housing NV
Any update on ACC acquisition? When will this one be complete?
RonEDickinson profile picture
BREIT, high volatility ??? If you look at the web site there are only three months of negative returns in the past six years, and two of these are around 1/10 of 1%. Every year was positive.
During Covid month of March 2020 there was a 8% drop but this was made up in three months. If you talk to BX management they would say large deals come to them because they have $, can do large deals and will close quickly, giving them an advantage. However they are raising over 3 billion a month and do need to deploy these funds and this gives me some concern about buying lessor performing assets vs. the current portfolio.
Harrison Wealth Management profile picture
I agree that non-traded REITs can be higher fee than publicly traded peers. EQR is 78bps, PLD is 155 bps and BREIT (institutional class) is 198bps. I also agree it gets really crazy when you go through a broker and pay all those commissions! However, you also need to look at implied cap rates and the price you are paying. PLD, one of the largest industrial REITs, has an implied cap rate of 3%. However, BREITs industrial properties are using a 6% cap rate. You are paying twice as much for industrial properties by buying PLD vs BREIT! We bought a lot of publicly traded REITs in mid-2020 but have shifted almost completely to non-tradeds now because they are 20-50% cheaper (and well worth the higher 43bps management fee, in our view. BREIT has one of the more conservative cap rate assumptions out there in the non-traded space.
Morgan Myrmo profile picture
@Harrison Wealth Management why would BREIT management value industrial at 6%, if the quality is near PLD? Also, wouldn't this immediately record a little lower w/ the implied low-cap rate PSB transaction diliuting their industrial holdings? While I get there may be a "little" distortion (both ways) from public REITs, I don't think BX would mark their portoflio at half the value in this space. We must also remember that PLD has perhaps the greatest industrial portfolio in the world - can BX say the same thing? What is their industrial growth rate? Will PSB management stay on to lend a hand at growth here?

Also, if you note $WPC industrial portfolio, or perhaps even $O for that matter, you may see some value if you want to break down the holdings, then mark to market. I hope this helps!
Harrison Wealth Management profile picture
@Morgan Myrmo Thanks for the additional insight. BX is marking their portfolio, but PLD is not - that is the currently cap rate implied by the market cap/stock price. Agree there could be some quality difference as I didn't break things down property by property. Also, all numbers were from 10-k filings so before the PSB acquisition, which I agree, should bring down the cap rate on industrial for BREIT. I think my point still holds - you can buy property much cheaper via BREIT than a lot of publicly traded REITs right now due to stock price implied cap rates (not set by management).
preterist profile picture
ATAX is worth looking at—a lot of student housing loans plus 25% equity ownership.
Hoya Capital profile picture
Thanks, @preterist! Took a quick look - interesting company. Essentially an mREIT structured as a publicly-traded partnership. Thanks for putting it on my radar.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.