Palladius Capital Management has purchased The Heights, a 672-bed student community in the San Marcos suburb of Austin, Texas. Capital Square sold the property after six years of ownership. Blackstone Group Debt Funds provided $21.3 million to finance the acquisition, according to Yardi Matrix.
Completed in 2005, the community encompasses 11 three-story buildings and 240 units with one-, two-, three- and four-bedroom apartments, ranging from 554 to 1,365 square feet with in-unit washers and dryers. Common-area amenities include a fitness center, business center, clubhouse, volleyball and basketball court, swimming pool and spa.
The company plans to enhance the property’s interiors and exterior space and upgrade the common area by adding new amenities to the clubhouse, pool and gym.
Located at 1101 E. River Ridge Parkway, the community is within 2.5 miles of Texas State University and the Bobcat Stadium. Various retail options, such as a Walmart Supercenter and Sanmar Plaza, are less than 3 miles away from the property.
Austin’s Student Housing Growth
The student housing market has showcased strong fundamentals, despite the initial dip at the onset of the health crisis. The major university markets ended the fall 2021 preleasing period at 94.3 percent, 0.4 percent above the rate recorded in 2019, the latest Yardi Matrix report shows. Two of the major universities in Austin also registered positive preleasing rates. The University of Texas at Austin was 27.8 percent preleased in November 2021, while Texas State University was at 15.4 percent.
Currently, there is one property in the planning phases at Texas State University, which will add 477 rooms to the inventory. The pipeline is stronger near The University of Texas at Austin, with five properties under construction, encompassing 2,950 rooms, Yardi Matrix data shows.
At the end of last year, Greystar Real Estate Partners secured $600 million in financing for three student housing projects. The Union on 24th, a $262 million project, will serve the students at The University of Texas at Austin and comprise 1,448 beds.