Bahrain-based GFH Group acquires $300m US student housing portfolio

GFH Financial Group (GFH) has acquired a c. $300m student housing portfolio affiliated to select universities located in Texas, Michigan and Missouri in the US. The acquisition is in partnership with GFH subsidiary Student Quarters, an Atlanta-based student housing specialist. The assets include facilities near Texas A&M University, Michigan State University and Missouri State University.

GFH’s investment strategy in the student housing sector focuses on building a diversified portfolio that targets universities within the top public 150 universities in the US, which are considered flagship universities in their respective states.

The student housing sector has performed well historically, even during the pandemic, as evident by an average stable occupancy rate well above 90 per cent and an equivalent high rental collections rate. Overall, the sector has witnessed supply shortages with the need for purpose built student housing assets that are within walking distance of Tier I institutions throughout the country spurred by rising enrollments and limited availability of University provided accommodations.

Nael Mustafa, co-chief investment officer – Real Estate at GFH, said, “As part of GFHs growing real estate activities, we are delighted to continue our investment in the student housing sector, which is experiencing positive momentum given the rise in US university enrollment, the growing US population and scarcity of class-A pedestrian, purpose-built assets. Our subsidiary Student Quarters also gives GFH and our shareholders a tremendous edge in this sector supporting value creation, alignment of interest and pure focus on achieving the targeted returns for GFH and its investors. They have an exceptional track record and experience and continuously rank among the top 25 student housing asset managers in the US.”

Stephanie Lynch, chief investment officer of Student Quarters, added, “We are excited to be growing our portfolio by purchasing these high-quality, well-located assets in exceptional markets that are within close proximity to top tier universities. We look forward to continuing to deliver compelling investment opportunities and demonstrate results.”

The portfolio has more than 2,000 beds with assets located within walking distance of their respective affiliated universities. They are relatively new and include amenities designed specifically to cater to student needs such as  swimming pools, courtyards, coffee shops, study lounges, clubhouses, game rooms and fitness centres.

Read: Bahrain’s GFH Financial Group reports net profit of $84.22m in 2021