SmartStop Affiliate Completes $43M Offering of Reno Student Housing

Reno Student Housing comprises The Summit, a 709-bed asset near the University of Nevada. The LEED-certified seven-building community is 97 percent leased.

By Jeffrey Steele

smartstopInvestors have fully subscribed to the Delaware Statutory Trust offering called Reno Student Housing, DST, of SmartStop Asset Management affiliate Strategic 1031 Properties LLC. The offering raised a total of $42.9 million of equity. Strategic 1031 Properties LLC is a Delaware limited liability company owned by SmartStop Asset Management LLC.

Reno Student Housing, DST comprises The Summit, a 709-bed student housing community. Located one block from the University of Nevada, Reno at 2780 Enterprise Road, the LEED-certified seven-building community is 97 percent leased.

The most challenging aspect of this acquisition was identifying a property that was an ideal fit for the Delaware Statutory Trust, or DST, investment structure,” SmartStop Asset Management founder, chairman and CEO H. Michael Schwartz told MHN.

“DST investors are normally pursuing the benefits of a tax-advantaged 1031 exchange, which complicates the process and requires particular expertise and work by the sponsor of the investment program, above and beyond the typical steps necessary to simply complete a real estate transaction.

We spent a great deal of time researching the key drivers of the industry, as well as the characteristics of institutional-quality properties. Once we identified our key drivers for fundamental growth and quality, we found this newly constructed University of Nevada, Reno property. Reno is a school with over 20,000 enrolled students, in a submarket with a tremendous amount of growth in the technology sector, with investments from Google, Tesla, and Switch, among others. The combination of growing enrollment trends at the university with strong multifamily fundamentals from job creation meant that this was an ideal asset for a long-term 1031 DST offering.”

One-to-one parity

Two- through five-bedroom floor plans comprise The Summit’s 186 fully-furnished units. The majority of those units feature one-bedroom-for-one-bathroom parity, providing heightened privacy. Among The Summit’s amenities are private study rooms, two-story clubhouse with fitness center, game lounge, pool, spa, computer room and business center.

In addition, the community provides gated access, campus shuttle service, covered bike storage areas and more.

Fiber optic cable featuring broadband speeds of one gigabit per second, supporting connectivity to multiple devices at a time, is incorporated property wide.

Recession-resistant asset

The University of Nevada, Reno is a 21,000-student, Division I school that has been ranked a  National Tier 1 University by U.S. News & World Report. The school furnishes more than 145 degree programs reflecting a broad array of subjects and disciplines.

Student housing is a needs-based real estate sector that has proven to be recession resistant,” Schwartz said. “We are very pleased to announce the completion of this DST offering. The Summit is a newly constructed student housing community that is purpose-built and amenities rich, as well as adjacent to one of Nevada’s largest universities.”

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