Alex. Brown Realty, Inc. (ABR) and Student Quarters in conjunction with Campus Realty Advisors announce the acquisition of University Downs, a student housing community in Tuscaloosa, Alabama. ABR Chesapeake Fund IV, a value-added real estate fund sponsored by ABR, invested $6.4 million in the venture.
University Downs includes 225 units and 435 beds and offers an 8,000 sf clubhouse featuring a fitness center, game room, movie theatre, business center, and conference room. The community is located less than one-quarter mile from the University of Alabama School of Law and three-quarters of a mile from the undergraduate campus.
Increased student enrollment at the university as well as limited on-campus student housing options have benefitted University Downs, which has maintained full occupancy since 2010. Pre-leasing for the 2014-2015 academic year is on pace with prior years and the joint venture anticipates University Downs will achieve 100% occupancy for the upcoming school year. Barriers to entry in the market should remain high as the city of Tuscaloosa recently enacted new zoning regulations to limit the development of new purpose-built student housing.
The joint venture plans to invest approximately $750,000 to renovate apartment unit interiors, enhance the landscaping, and update the clubhouse. Asset Plus, the nation’s largest privately owned student housing manager and a repeat partner and property manager with ABR, will oversee management and leasing at the property. “We anticipate the capital improvements and the addition of an experienced management team will allow us to add significant value to the community,” said Andy Feinour, president of Student Quarters.
The joint venture acquired the project from the original developer via an off-market transaction at an attractive basis. “Our basis will allow us to achieve our targeted returns while maintaining very competitive rental rates,” noted Tom Burton, CIO of ABR.
University Downs represents the first joint venture between ABR and Student Quarters and the third between ABR and Asset Plus.
Alex. Brown Realty, Inc. (ABR) is a privately owned real estate investment manager organized in 1972 and headquartered in Baltimore, Maryland. ABR co-invests with joint venture partners in a broad spectrum of property types located throughout the United States. www.abrealty.com
Student Quarters is a division of St. Clair Holdings and a student housing investor. Student Quarters focuses investments on underperforming properties within walking distance to universities in the Southeast, Mid-Atlantic and Midwest. Campus Realty Advisors identifies college markets and properties that offer significant upside potential, and partners with investors like ABR and Student Quarters to create value in student housing. www.stclairholdings.com
Asset Plus Companies (APC) is a Houston-based real estate management firm specializing in maximizing value for owners, developers and investors of conventional, student, affordable, tax credit, military and senior housing nationwide. APC was founded in 1986. www.assetpluscorp.com
Thomas R. Burton, 410-547-3009