JV Acquires SoCal Student Housing for $43M
Riverside, Calif.--The Palms on University boasts a fitness center, computer lab, game room, tanning salon, pool and spa, and outdoor basketball and volleyball courts.
Riverside, Calif.–Pierce Education Properties, in a joint venture with Harrison Street Real Estate Capital, has acquired the Palms on University, a 607‐bed, off‐campus student housing property near the University of California Riverside. The buyers paid $43.5 million for the property, with debt financing of $32.9 million provided by Freddie Mac.
Developed in 2005, the Palms on University (previously Sterling University Palms) is located within walking distance to campus, and is comprised of 152 two‐ and four‐bedroom units. Amenities include a fitness center, computer lab, game room, tanning salon, pool and spa, and outdoor basketball and volleyball courts. The Palms also includes about 16,700 square feet of retail space and is near other retail, restaurants and entertainment venues.
“With the acquisition of the Palms, we closed $70 million in new acquisitions in the second half of 2010 and we anticipate acquiring between $100 million and $200 million in student housing assets in 2011,” Pierce Education Properties CEO Fred Pierce tells MHN. “Our target is both core and underperforming Class A, purpose-built product serving the top 80 universities in the country.”
The acquisition puts San Diego Pierce Education Properties’ portfolio at more than 5,000 beds. Chicago-based Harrison Street Capital invests in student housing, medical office, senior housing and storage properties. The firm, on behalf of Harrison Street Real Estate Partners I, II and III, currently owns about $2.1 billion in real estate assets, which includes over 15,800 student housing beds.
The Palms on University acquisition was the latest of the JV’s activities in that sector. In 2010 the two acquired the senior mortgage note secured by the 792‐bed Crimson Park student apartment community near the University of Oklahoma.