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Why Student-Housing Is Outperforming Multifamily

August 2, 2017

Why Student-Housing Is Outperforming Multifamily

The success of this sector follows a significant trend of institutional investors diversifying away from the four “food groups” of CRE and allocating a portion of their real estate capital to less-correlated niche asset classes, Pierce’s Fred Pierce tells GlobeSt.com.

Pierce: “I predict that in the foreseeable future, it will be the norm for institutional investors to establish dedicated asset allocations to both student housing and senior housing within their multifamily allocations.”
Pierce: “I predict that in the foreseeable future, it will be the norm for institutional investors to establish dedicated asset allocations to both student housing and senior housing within their multifamily allocations.”

 

July 31, 2017 | Carrie Rossenfeld | GlobeSt.com

The success of the student-housing sector follows a significant trend of institutional investors diversifying away from the four “food groups” of CRE and allocating a portion of their real estate capital to less-correlated niche asset classes, Pierce Education Properties’ founder, CEO and president Fred Pierce tells GlobeSt.com. We spoke with Pierce for an update on investment in the sector, how it compares to other types of multifamily properties and his expectations for its future.

GlobeSt.com: The volume of commercial-property sales overall is decreasing, although student housing is doing better than other kinds of multifamily. How long can this continue? 

Pierce: This is following a significant trend of institutional investors diversifying away from the traditional four main “food groups” of commercial real estate (multifamily, retail, office andindustrial) and allocating a portion of their real estate capital to less-correlated niche asset classes including student housing, senior housing, healthcare real estate, medical office, self-storage, data storage, etc. In subsequent years, continued interest in the sector has caused PREA to add student housing and healthcare real estate as their own categories in the annual survey.

 

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Gregory De Jong, CFP, Co-Founder of Paragon Advisors, LLC.
July 7, 2015

Blue Vault is just what advisors need to size up the different offerings in the nontraded REIT market. Just as importantly, it’s what the industry needs to encourage best practices among REITs.