Nelson Partners Talks About Student Housing as a Popular Asset Class

Over the last decade or so, United State campuses are expected to host a million more college students than they do today. To meet the steadily growing demand for student housing, the real estate market is witnessing a proliferation of development projects that are driven by the attractive prospect of higher revenues and steady occupancy. Nelson Partners is among the most reputable names engaging in the development and management of student housing properties. Several colleges and universities are even enticed by the notion of choosing to outsource their on-campus student-housing projects.

Today student housing is acknowledged as a vital and lucrative real estate segment across the globe. It generally comes under the ‘alternative’ real estate asset classes. Student housing as a product is majorly undersupplied in many major markets, while having the potential for high and sustained occupancy rates.  This factor provides a market opportunity for investors who are focused on yield-based real estate products.

Student housing, in many ways, is a subset of the multi-family asset class. It is broadly characterized as housing that principally serves undergraduate or graduate college students. This sector is particularly noted for its dependable cash flows, and has managed to benefit from recent demand trends when it comes to higher education. The overall resiliency of student housing properties during the recent economic downturn has subsequently managed to magnetize significant interest. However, much like any real estate investment, student housing also comes with a variety of distinctive risks and challenges. For the long-term success of a student-housing development, its design is critical. The right or wrong design also can have quite a transforming impact on the financial performance of the property.

Even with the development of online academic programs and dissatisfaction linked to costs of college education, domestic matriculation in the United States does continue to rise. Over the years, a marked increase has been witnessed in the number of students seeking high education in the country, thereby creating an increased need for student housing as many of the colleges and universities have lagged in expanding their on-campus dormitories. Moreover, a large number of students today to recognize that existing on-campus facilities at times might be outdated or lacking in amenities. This factor has enabled private developments to differentiate themselves by opting to y better aligning apartments with student needs in locations convenient to campus. Such factors considerably contribute to the popularity of the student housing market, while allowing the sector a certain level of protection from the negative effects of the recent stagnant economy.

With proper due diligence, many investors can actually achieve favorable returns while accepting the operating risks that are associated with this emerging asset class. Nelson Partners is a company that puts emphasis on performing high-level on-going due diligence on each and every property they have been involved in. This company additionally has more than 1,200 investors in their 1031 exchange programs.