Student Housing Asset Commands $55M in Tight Canadian Market

Cushman & Wakefield worked on behalf of Alignvest Student Housing to acquire the 357-bed property from CA Ventures of Chicago.
1Eleven

Alignvest Student Housing Inc. has entered the Ottawa, Ontario market with the acquisition of 1Eleven—a 224-unit, 357-bed student housing property situated in an undersupplied market—from CA Ventures, for $54.7 million. Cushman & Wakefield negotiated the deal on behalf of the buyer.

Located at 111 Cooper St., the building is approximately a quarter mile from the University of Ottawa via a pedestrian bridge over the Rideau Canal and is less than 10 minutes from Carleton University. 

“1Eleven came online in 2015 as the first off-campus, all-inclusive, purpose-built student accommodation asset in the Ottawa market,” Jake Mandel, Alignvest Student Housing’s analyst, told MHN. “Although enrollment at the University of Ottawa and Carleton University have increased 6 percent over the past five years, and the number of applicants to the University of Ottawa grew by 15 percent year-over-year in 2018, the two universities only have around 8,500 beds available for their students, representing 14 percent of their total full-time enrollment.”

As a result, Alignvest was determined to capitalize on the significant demand/supply imbalance by acquiring 1Eleven.

“Alignvest is seeking to acquire high-quality PBSA assets near tier-1 universities in Canada to build a diversified portfolio,” Mandel said. “1Eleven was completely renovated in 2015, offers high-end student-oriented amenities, provides management with the ability to improve the quality of its product offering by securing a commercial tenant and offering new services such as in-suite cleaning and enhanced internet, which will allow the REIT to realize local and national economies of scale in the long-term.”

Strong Amenities

The property offers fully-furnished one- two- and four-bedroom residences and is 100 percent occupied for the 2018-19 school year. The 16-story building offers high-end amenities with a unique modern lobby, study lounges, a gym and yoga studio, games and social lounges, on-site laundry facilities, on-site parking and fully-furnished suites, which fosters the optimal collegiate atmosphere.

“In addition to the building’s amenities, 1Eleven is strategically located [a quarter mile] from the center of the University of Ottawa’s campus, providing investors with significant operational upside,” Mandel said. “It has limited occupancy risk as evidenced by the 100-person waitlist as of September 30, 2018 and is an institutional-grade PBSA asset that diversifies the REIT’s portfolio.”

The property is situated in the Golden Triangle, offering breathtaking views of downtown, and is surrounded by establishments that meet the needs of students, including restaurants, pubs, coffee shops, stores, and supermarkets.

Furthermore, students can take advantage of the many events hosted by the city of Ottawa at City Hall and can easily access the city’s new uOttawa LRT Station and Byward Market, which is only approximately an $8.00 UberX fare.

“It’s a fantastic location in a supply constrained market,” Travis Prince, Cushman & Wakefield’s executive managing director, told MHN. “The seller had an executed business plan and the buyer was eager to add scale in Canada.”

Earlier this month, Alignvest Student Housing REIT acquired The Annex, the newest addition to the University of Ottawa’s residence portfolio, which further provides ASH REIT with a strong foot-hold in one of the most attractive student housing markets in the country.

At the end of 2018, CA Ventures launched CA Management Services (CAMS), an expansion of the company’s property management services arm

Image courtesy of Cushman & Wakefield