JV Acquires Three Student Housing Properties

A joint venture between Scion Group and Virtus Real Estate Capital has a acquired a portfolio of three student housing properties totaling 2,360 beds in 628 apartment units.

Chicago and Austin—A joint venture between Scion Group and Virtus Real Estate Capital has acquired a portfolio of three student housing properties totaling 2,360 beds in 628 apartment units. The $118 million portfolio includes the Village at Blacksburg, a 1,056-bed property near Virginia Tech; State College Park, a 752-bed property serving Penn State University; and University Pines, a 552-bed community close to Georgia Southern University, whose name will be changed.

The seller was American Campus Communities. The JV plans to spent $6 million in upgrades to the properties, which were acquired with mortgage financing from Fannie Mae issued by M&T Realty Capital Corp. and arranged by Holliday Fenoglio Fowler LLP.

The Village at Blacksburg is located less than a mile north of the Virginia Polytechnic Institute and State University (Virginia Tech) campus in Blacksburg, Va. It includes two- and four-bedroom apartments, and Scion and Virtus plan upgrades to interiors, grounds and other amenities. Virginia Tech enrolls more than 31,000 full-time students, including nearly 29,000 at its 2,600-acre main campus in Blacksburg.

State College Park is less than a mile west of the Penn State University campus in State College, Pa., and also includes two- and four-bedroom apartments in a park-like setting. The joint venture likewise plans upgrades to the property’s interiors, grounds and other amenities. Penn State was chartered in 1855 and remains Pennsylvania’s only land-grant university; it has the largest enrollment in Pennsylvania and one of the largest in the United States.

University Pines is directly across the street from Georgia Southern University in Statesboro, Ga., and immediately adjacent to a 564-bed student property already owned by a Scion and Virtus JV. The two communities will be managed together as Cambridge@Southern. Georgia Southern U now enrolls over 20,000 students, an increase of over 20 percent in the past five years, with plans for more growth that include joining the NCAA FBS (Division I-A) as a member of the Sun Belt Conference in 2014.

Scion will manage the venture and the properties, marking eight student-housing communities now owned by JVs of Scion and Virtus. Chicago-based Scion is the owner-operator of over 11,500 beds of student housing at 14 campuses, while Austin-based Virtus’ various funds have acquired more than $2.3 billion in assets since its inception in 2003. Virtus made this particular investment through a combo of its flagship diversified fund, Virtus Real Estate Capital LP, and its specialized student housing fund, Virtus Student Housing LP.