If student housing has suddenly become a risky investment, Core Spaces didn’t get the memo.
The developer filed plans for its second housing development near the University of Southern California campus. The company wants to build a 157-unit apartment complex at 2714 South Figueroa Street, less than a mile from USC. Undergraduate classes there will be mostly online starting in the fall.
Core Spaces is seeking incentives for the project through Los Angeles’ Transit Oriented Communities program. The TOC program allows for more units by easing density limits on projects within a half-mile of transit stops, and which have an affordable housing component.
Core Spaces’ project also includes more than 5,000 square feet of commercial space. The Austin-based developer purchased most of the property last year in two separate deals totaling $15.75 million. Core Spaces did not return messages left for comment.
The firm is already building a 71-unit mixed-use complex near USC, at 38th and Figueroa streets, called “The Hub on Campus.”
Core Spaces’ student housing-focused projects are scattered across the country, including in Gainesville (University of Florida), Lexington (University of Kentucky), Tucson (University of Arizona), West Lafayette, Indiana (Purdue University, and East Lansing (Michigan State University) among other locations.
Leasing rates for student housing markets are being scrutinized as an increasing number of schools shift to remote learning for the fall.
And since the pandemic, student housing loan borrowers have one of the highest rates of forbearance requests to Fannie Mae and Freddie Mac. And even before the coronavirus pandemic hit, a high number of delinquent mortgage securities came from student housing mortgages.