Case Studies

Property Name

Master Lease Case Study - 30 East

Chicago, IL

YOC
2017
Units
134
Beds
386
Date of Sale
09/18/2019

Scenario

30 East is a core, urban infill high-rise student housing community located one block away from Columbia College in the South Loop neighborhood of Downtown Chicago. The 134-unit and 386-bed property included a 10-year master lease with Columbia College for 88% of the building. The master lease featured lease terms of only nine months of each academic year, leaving the owner to backfill the remaining three months each year. The property also included over 6,600 square feet of retail occupied by credit worthy tenants. 30 East was offered on an all-cash basis.

Results

The asset was marketed on behalf of a national student housing developer and garnered a significant amount of interest from a wide spectrum of buyers. Student housing, conventional multifamily, and foreign investors made up the “best and final” round of bidding. Ultimately, an institutional multifamily owner and operator was selected as the buyer.

Property Name

Core Plus Case Study - The Luxx

San Antonio, TX

YOC
2014
Units
220
Beds
694
Date of Sale
01/31/2019

Scenario

The Luxx is a Class A mid-rise student housing community located proximate to the University of Texas at San Antonio. Built in 2014, the 220-unit and 694-bed property features best-in-class amenities including fully furnished units with modern interior finishes, resort-style pool with swim up bar area and a two-story fitness center. The property struggled to maximize operations due to the seller’s lack of experience in the student housing industry. Luxx was offered on an all-cash basis. This allowed a new student housing focused owner the ability to capitalize on outsized yields due to operational upside.

Results

FourPoint marketed the asset on behalf of a Cleveland-based real estate developer. The Luxx presented a unique opportunity because the seller did not have student housing experience, which allowed a new student housing focused owner the ability to capitalize on outsized yields due to operational upside. FourPoint quietly approached a select number of potential investors off-market, and through this approach, was able to identify a buyer in a short timeframe above ownership’s pricing expectations.

Property Name

Distressed Case Study - National Four-Property Portfolio

Various

YOC
2007-2012
Units
860
Beds
2,282
Occupancy at Sale
81%
Date of Sale
11/30/2018

Scenario

The National Four-Property Portfolio consisted of the following properties: The Verge Ellensburg, WA, The Verge Nacogdoches, TX, The Verge Clarksville, TN and The Grove Statesboro, GA. All properties are garden-style student housing communities with varying levels of occupancy in challenging markets. Built between 2007-2012, all properties offered a new owner the ability to significantly improve property operations through a variety of operational and physical upgrades. Despite the lack of geographical homogeny, seller required all the properties be sold to one single buyer.

Results

FourPoint marketed the four-property portfolio on behalf of a national private equity firm. The portfolio was offered to a select number of potential investors in an effort to quietly sell the property without any risk of overexposure. FourPoint procured a number of initial offers and experienced a competitive best and final round of bidding. The portfolio was ultimately sold to a syndicator who procured foreign equity for the acquisition.

Property Name

University Sale Case Study - Deacon Place

Winston-Salem, NC

YOC
2017
Units
82
Beds
328
Occupancy at Sale
100%
Date of Sale
11/30/2018

Scenario

Deacon Place is a Class A student housing community located within walking distance to Wake Forest University. Built in 2017, the 82-unit and 328-bed property features townhome style apartment units with modern interior finishes. Community amenities include a resort style pool, putting green and a fitness center. Deacon Place is one of only two purpose-built student housing communities serving Wake Forest University. The asset was offered on an all-cash basis.

Results

Deacon Place was marketed on behalf of a privately-held real estate development group. The offering garnered a significant amount of interest from a wide spectrum of buyers. Due to Wake Forest’s initiative to offer students university housing during the entirety of undergraduate studies, Wake Forest showed interest from the beginning of the process. FourPoint was able to maintain a competitive process, including negotiating pricing and timing from Wake Forest that is consistent with industry standards.

Property Name

Boutique Case Study - The District Lofts

Tuscaloosa, AL

YOC
2012
Units
81
Beds
161
Occupancy at Sale
99%
Date of Sale
07/26/2018

Scenario

The District Lofts consists of a boutique two-property portfolio: Green Bear Lofts and The Boulevard. Located in the heart of Downtown Tuscaloosa, these assets serve upper-classman and graduate students in the University of Alabama market. The properties’ strong operations have maintained 100% occupancy since their opening despite not being fully furnished or having an amenity set comparable to other student housing product in the market.

Results

Not considered purpose-built student housing, these assets presented a unique opportunity which led FourPoint to take an off-market approach quietly showing the assets to a select number of potential investors who primarily seek boutique investment offerings. Through the off-market approach, FourPoint was able to select a buyer in a short timeframe at ownership’s pricing expectations. The buyer was a national student housing owner / operator based in Northern California.

Property Name

Core Case Study - Square on Fifth

Atlanta, GA

YOC
2015
Units
230
Beds
628
Occupancy at Sale
98%
Date of Sale
07/10/2018

Scenario

SQ5 is a Class A core, urban high-rise student housing community located adjacent to Georgia Institute of Technology in Midtown Atlanta. The 230-unit and 628-bed property features luxury amenities including units with floor-to-ceiling windows and city views, a rooftop pool deck and state-of-the art amenity center. SQ5 was offered on a loan assumption basis.

Results

The SQ5 offering was set to go to the market, but FourPoint was able to secure a preemptive offer at full whisper price. The buyer was an operator/pension fund joint venture seeking core acquisitions. After loan assumption approval, the buyer closed at the contracted price.

Property Name

Value-Add Case Study - The Lodge & The Edge

San Marcos, TX

YOC
2001/ 1998
Units
258/ 696
Beds
696/ 553
Occupancy at Sale
100%
Date of Sale
03/01/2018

Scenario

Built in 2001 and 1998 respectively, the Lodge and the Edge are generation one student housing properties located approximately one mile from Texas State University. Both properties are well-established in the Texas State market and their value-oriented rent structure has led to consistently high occupancies over the last several years, resulting in dependable, stable cash flows. Prior to selling, ownership renovated 10% of the units at one of the properties leasing each renovated bed at a $50 premium, showing potential for a new buyer to complete a value-add renovation in the remaining units.

Results

FourPoint marketed the asset on behalf of a national student housing owner and operator. The Lodge and The Edge were marketed as a two-property portfolio that could be purchased together or separately. FourPoint ran a very competitive process and procured ten offers. Ultimately the buyer offered non-refundable earnest money at execution of the purchase and sale agreement and closed at the contracted sales price.

Property Name

Tax Abatement Case Study - Rockoff Hall

New Brunswick, NJ

YOC
2005
Units
182
Beds
674
Occupancy at Sale
81.5% (9/5/17)
Date of Sale
01/18/2018

Scenario

Rockoff Hall is a high-rise, urban infill property located proximate to Rutgers University in New Brunswick, NJ. Built in 2005, this mixed-use asset benefits from a 30-year Payment in Lieu of Taxes (PILOT) Program that deferred real estate tax payments in exchange for an annual service charge.

Results

Rockoff Hall was marketed for an Operator/Fund joint venture. FourPoint conducted several tours, procuring multiple offers from student housing and multifamily investors. The selected buyer was an Investment Bank represented by a large institutional operator who took advantage of the tax abatement savings and enhanced the property through unit interior renovations.

Property Name

Portfolio Case Study - Southwest Garden-Style Portfolio

Southwest

YOC
2008-2010
Units
762
Beds
1,976
Occupancy at Sale
95%
Date of Sale
05/24/2017

Scenario

This portfolio consisted of three properties: Avalon Place and Hill Country Place in San Antonio, TX and Hill Place in Fayetteville, AR. All properties are fully-amenitized garden-style student housing communities located near their respective state supported universities: The University of Texas at San Antonio and The University of Arkansas. Built between 2008-2010, all properties offered a new owner the ability to improve property operations by implementing a value-add plan consisting of a variety of operational and physical upgrades.

Results

FourPoint marketed the portfolio on behalf of a large pension fund advisor. The portfolio was highly sought after by a wide variety of investors due to the unique attributes of the value-add opportunity. Ultimately the portfolio was sold to three separate buyers yielding the highest net price to the seller. The buyers included a national student housing owner/operator, a national student housing private equity group, and a family office. While FourPoint was able to maximize pricing for the portfolio, there was no portfolio premium from a cap rate perspective.