Campus Advantage on Growth Spurt With Five Acquisitions This Year

By Jeffrey Steele, Contributing Writer

Austin, Texas—Campus Advantage has acquired five additional student housing properties since the beginning of this year, helping solidify the Austin-based company’s already significant standing in the nation’s student-housing industry.

The acquisitions, which add 2,168 total new beds to the student-housing portfolio of Campus Advantage, will ultimately benefit pensions serving teachers and employees of city, county and state governments.

Many of the properties acquired are already experiencing high occupancy rates, evidence they are situated in areas witnessing strong student housing demand.

The most recent acquisitions mean Campus Advantage’s housing portfolio stands at 52 properties in 19 states, bringing its total bed count to 25,000.

These are the five properties acquired this year:

• 42North, Tampa. This 420-bed community serves University of South Florida students, and is situated one-half mile from campus. Among its amenities are a clubhouse with a fully equipped community room that includes an upgraded computer lab and game room with ping pong and billiards.
• On50, Tampa. The University of South Florida’s eastern edge is the location of this 444-bed property. Cathedral ceilings and skylights in some units, heated pool, hot tub, sauna and deck are among the amenities of the community, which features townhome-style living.
• 2040 Lofts, Milwaukee. Located five blocks from the core of Marquette University’s campus, the 612-bed property features a fireplace lounge, 24-hour fitness center and quiet study room on each floor. Retail space encompassing approximately 2,450 square feet is also part of the property.
• The Avenue, Indianapolis. This 356-bed property serves Indiana University-Purdue University Indianapolis students, and markets the third acquisition under Campus Advantage’s second $75 million joint venture with the California State Teachers’ Retirement System.
• Campus Quarters, Corpus Christi, Texas. This 336-bed property is situated 1.5 miles from the Texas A&M University-Corpus Christi campus. Amenities include a 3,700-square-foot clubhouse with fitness area, billiards lounge, video gaming room, private conference room and Wi-Fi access.

Campus Advantage expects to add some $150 to $200 million in assets in 2014. Company CEO Mike Peter reports he anticipates a number of publicly traded student housing companies, such as American Campus Communities and EdR, to remain on the sidelines. That should generate more opportunities for private investors such as Campus Advantage to obtain a majority of the business.

“Given how the public markets have reacted to raising interest rates and so-called ’leasing hiccups’ by our REIT counterparts, our ability to continue to acquire core student housing at attractive cap rates will continue as REITs sit things out until their stocks recover and their limited cap rates come down to a point to where new acquisitions are accretive to cash yield,” Peter says.