Harrison Street Launches New Student Housing Partnership in San Diego
The developer has crossed $6 billion in public-private projects.
Harrison Street Asset Management and development partner The Michaels Organization have unveiled Presidio Terrace Apartments, a $230 million, 321-unit, 700-bed on-campus student housing project being built in a public-private partnership with the University of San Diego. The community is expected to be completed by August 2029.
Presidio Terrace will be located between the university’s academic center and a nearby retail corridor. It will house upperclassmen, graduate and professional students and provide access to the business, nursing, engineering and law schools. The approximately 570,000-square-foot building will have about 248,018 square feet of net rentable space. Amenities at the community will include an indoor/outdoor fitness center, lounge and study spaces, a juice bar, a grab-and-go food space, an outdoor media wall and rooftop decks overlooking Mission Bay.
The project is structured through a 99-year ground lease with USD and will benefit from a full real estate tax exemption as a university-affiliated facility. Michaels will be the developer and operator of the student housing property. USD’s total enrollment increased by 13.2 percent since 2020.
A growing student housing public-private strategy
The project represents Harrison Street’s first transaction from its new, dedicated public-private partnership strategy and is the university’s first-ever agreement. With this latest project, Harrison Street has surpassed $6 billion in public-private-sponsored assets under management.
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The firm launched its PPP business in 2018. Since that time, it has completed 64 public-private partnership transactions across its platforms with more than 20 other universities. Schools include Northwestern University, Duquesne University, Duke University, Arizona State University, University of Kentucky and Missouri State University. More than 40 percent of the firm’s higher education pipeline consists of opportunities with existing university partners that are considering their second or third public-private projects with Harrison Street.
Expanding their portfolio
Harrison Street owns more than 237,000 beds across North America and Europe. Since inception, the firm has invested more than $24 billion across 432 student housing properties.
In May, Harrison Street sold a 12-property, 7,578-bed student housing portfolio to a joint venture between The Scion Group and an Ares Real Estate fund for $910 million. It was the largest transaction for the student housing sector to date this year. Harrison Street acquired the properties over the past 10 years through five separate fund vehicles. They were located across 10 states and 12 university communities, including Arizona State University, Auburn University, University of Florida, the University of Notre Dame, The Ohio State University and James Madison University.
Earlier this summer, a joint venture between Harrison Street and Trinitas Ventures secured a floating-rate bridge loan to refinance Atmosphere Tempe, a 530-bed student housing community in Tempe, Ariz. The 20-story, 252-unit building is within walking distance of the ASU campus and downtown Tempe.
