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Deals & Dealmakers

QuadReal invests $600M in student housing venture

QuadReal Property Group (QuadReal), CA Student Living (CASL) and GI Partners (GI) have formed a joint venture to acquire, develop and manage student housing at select universities throughout the United States.

Uncommon Athens, located near the University of Georgia, is one of the many student housing projects that QuadReal Property Group, CA Student Living and GI Partners will acquire, develop and manage at select universities throughout the United States. (CNW Group/QuadReal Property Group)

QuadReal has invested $600 million US of equity into the joint venture. CASL and GI are co-investors and general partners, with CASL serving as the operating partner. All three entities have established track records in residential real estate and manage multi-billion-dollar real estate portfolios. CASL has acquired 5,000 university beds and developed another 20,000 new beds since its founding in 2004, making it one of the most active infill student housing developers in the country.

The joint venture provides QuadReal and GI with a compelling entry point into the growing US student housing market. The sector performs well throughout all economic cycles, and offers downside protection during periods of economic contraction.

“Much of the student housing stock in the US is aging and in need of repair or replacement, providing an opportunity to invest in long-term assets that provide an ongoing, dependable revenue stream and align with QuadReal’s desire for strong investment returns,” said Jonathan Dubois-Phillips, President, International Real Estate, QuadReal.

“We are very pleased to work with experienced partners such as CASL and GI as we build out our current portfolio of high-quality, income-producing properties and seek future investments in the resilient student housing sector.”

The joint venture’s initial portfolio includes 10 properties developed and managed by CASL. The properties are geographically diversified in 10 major US university markets across nine states. In addition, the joint venture will acquire and develop additional student housing projects across the country to grow and diversify the portfolio.

Emerging fundamentals in the US student housing market are creating change and opportunity. Students living in on- and off-campus housing increasingly demand walkable locations with modern amenities such as fitness centers, study lounges and communal areas, as well as features like high-speed internet.

“More than a decade ago, CA Student Living began as a pioneer of core infill, pedestrian-oriented developments with modern designs and amenities,” said Tom Scott, CEO of CASL. “Our unique site selection and product development skillset strongly align with the investment philosophy of the new joint venture. The long-term nature of this partnership with QuadReal and GI underscores our confidence in the continued growth of this burgeoning sector.”

“As long-term investors in high quality real estate platforms, GI Partners carefully seeks the right mix of property sectors with attractive growth attributes and experienced, successful partners capable of achieving scale,” said John Saer, Managing Director of GI. “We are delighted to partner with the accomplished team at CASL and to align with a strategic investor in QuadReal.”

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