School’s out for summer. But will student housing rebound in the fall?

Covid-19 could also upend one of real estate’s most stable investment sectors, as an increasing number of colleges shifting to online classes

TRD NATIONAL /
May.May 20, 2020 04:15 PM
American Campus Communities CEO Bill Bayless

American Campus Communities CEO Bill Bayless

The shift among some colleges to online classes has been met with skepticism in academia but it could also spell trouble for student housing investors.

Housing geared to students has historically been considered a safe investment, but the uncertainty around the coming school year has some questioning that thinking, according to the Wall Street Journal.

Overall, pre-leasing rates for student housing properties in April was relatively unchanged from a year ago, at around 65 percent, according to the report. But some landlords have fared worse than others.

Student Housing Solutions, a company with properties near three Florida campuses — including Florida State University — said it has leased about 60 percent of its units compared to 75 percent this time last year.

The 23-campus California State University system and Eastern Washington University are among the larger institutions to move primarily to online courses for the fall, which will cut into occupancy levels at surrounding apartment properties. Harvard Medical School is putting together some courses for students as well.

Investor anxiety could be contributing to dips in share prices for major student housing investors. American Campus Communities, which owns or manages more than 200 properties nationwide, has watched its share price drop 20 percent since March 13, even as CEO Bill Bayless says leasing hasn’t slowed much compared to last year.

Coronavirus or not, cracks were beginning to show in the student housing investment sector before the pandemic hit — about 3.9 percent of student housing-backed CMBS debt was delinquent at the end of November 2019. [WSJ]Dennis Lynch


Related Articles

arrow_forward_ios
The process for challenging property assessments is so antiquated, officials won’t do Zoom meetings. (iStock)

“A recipe for disaster”: Fighting property taxes in a pandemic

“A recipe for disaster”: Fighting property taxes in a pandemic
Clockwise from left: Bronx housing court at 1118 Grand Concourse, Governor Andrew Cuomo, Judge Lawrence Marks, New York Supreme Court at 60 Centre Street (Getty; Google Maps; Wikipedia; New York State Courts)

Attorneys find ways to “eject” tenants without Housing Court

Attorneys find ways to “eject” tenants without Housing Court
Cadillac Fairview CEO John Sullivan and the RCB Centre in Toronto (Google)

This Canadian office giant has a strategy for a return to work

This Canadian office giant has a strategy for a return to work
Bars, restaurants and live entertainment venues around the world are now weighing their reopening options. Some owners say they can’t cover the cost of operating at reduced capacity. (Getty)

Facing the music: Entertainment venues, restaurants weigh reopening options

Facing the music: Entertainment venues, restaurants weigh reopening options
Anbang’s Andrew Miller, Mirae’s Peter Lee and (from left) JW Marriott Essex House, the Westin St. Francis in San Francisco and the Four Seasons in Jackson Hole (Credit: Marriott, Westin, Four Seasons)

Buyer’s remorse?: How Anbang’s $5.8B hotel deal went sideways

Buyer’s remorse?: How Anbang’s $5.8B hotel deal went sideways
Softbank's Marcelo Claure, Masayoshi Son and Rajeev Misra (Getty; iStock)

Internal feud at SoftBank casts doubt on Vision Fund

Internal feud at SoftBank casts doubt on Vision Fund
Commercial real estate property sales fell to their lowest level in a decade as a result of the economic slowdown caused by the coronavirus pandemic. (Pixabay)

TRD Insights: Commercial deal volume plummeted 71% in April

TRD Insights: Commercial deal volume plummeted 71% in April
Bed Bath & Beyond is planning to reopen 600 U.S. stores as states begin to wind down shelter-in-place orders. (Getty)

Bed Bath & Beyond to reopen 600 US stores

Bed Bath & Beyond to reopen 600 US stores
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...