Blackstone landed a $1 billion refinancing deal for part of a student housing portfolio it added in 2022, which includes multiple Texas properties.
The five-year loan will be used to refinance $809.8 million of debt, cover closing costs and return $115.3 million to the sponsor, according to a report from Morningstar Credit.
The loan is backed by 32 student housing properties with 18,502 beds. The portfolio is spread across 19 universities, including Texas Tech University and Texas A&M University.
While occupancy fell from 95.8 to 93.5 percent across the portfolio between this school year and the previous one, the portfolio’s rental revenue has ticked up. In the last two years, the average rent per occupied bed jumped almost 14 percent, from $664 to $755.
The properties are part of a larger portfolio of student housing owned by Austin-based American Campus Communities, which Blackstone bought for $12.8 billion two years ago. Blackstone paid $65.47 per share and took the company private through its Blackstone REIT and Blackstone Property Partners.
The purchase anointed the asset class a rising star, and it’s since become a sought-after investment vehicle.
Unlike the tumultuous multifamily and office markets, student housing has remained resilient even in the face of high interest rates. That’s in part because there’s a shortage of student housing.
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Schools are enrolling 1.34 students for each available bed at the top 20 universities by housing inventory, CoStar reported, citing data from Walker and Dunlop in May. That ratio was 1.46 at Texas Tech, 1.23 at Texas A&M and 1.04 at the University of Texas at Austin.