Inside Advantage Summer 2023

As the weather has warmed in 2023, the student housing investment sales market has begun to thaw a bit as well. Pipelines are showing some life and while there is still a very real gap in pricing expectations between buyers and sellers, more transactions are happening than in the first quarter. The floodgates are not yet open, however, and it will likely take until fall for that to happen. We believe there will be a large pipeline of deals for sale this fall, and the fourth quarter in particular will see a large transaction volume of student housing assets. While some investors are looking for potential distress among assets with upcoming loan maturities, we think these opportunities will be rare in stronger markets. The real distress seems likely to be limited to second- or third-tier markets with poor enrollment and/or supply dynamics.

Capital markets are still in upheaval but more due to inflation expectations and the Federal Reserve’s ongoing efforts to control inflation rather than any real concerns of contagion from the banking crisis this spring. As of mid-July, yields on both the 5- and 10-year Treasuries are close to their highs reached last October, which are the highest levels we have seen since the 2007–2008 financial crisis. Most Fed watchers seem to believe the Fed will raise rates in July by 25 bps and by another 25 bps before the end of 2023. This is probably all but priced into the market at this point.

INDUSTRY NEWS

The strongest student housing leasing market in history continues this quarter with pre-lease occupancy at 86% as of mid-July, which is ahead of last year by 0.9%. Pre-leasing has been much further ahead throughout the year than it is now, but it naturally narrows toward the end of a leasing season assuming both years end up close to 95% occupancy. Average asking rent is currently $901 per bed, which is 10.6% higher than a year ago. This rent growth figure is the strongest we have seen since reliable data has been available in the space. It shows that the normal trend of summer rent concessions is not happening as much as it did last year.

Scott Barton
Chief Investment Officer

 

---

 

TRENDSETTERS

In early 2021, Campus Advantage made the decision to collaborate with Catalyst, our in-house marketing partner, to manage our corporate social media services. Specifically, we were in search of innovative ways to include more organic content focused on our employees and CA’s unique company culture, which would in turn assist with hiring and employee engagement.

In February 2021, Catalyst began working on content creation across Campus Advantage’s four primary social platforms: Facebook, Instagram, Twitter, and LinkedIn. The new social media management approach involved monthly company-wide brainstorms that incorporated requests from various divisions. This process allowed all divisions to be served and highlighted while also weaving in new and fresh themes and campaigns that would keep audiences continuously engaged. Posts included a mixture of company milestones, promotions, monthly themed highlights, employee spotlights, holidays, company news, and special observances. To ensure posts followed the Campus Advantage corporate brand standards, Catalyst utilized consistent colors and typography, which created a cohesive social feed.

The results from this approach have been dramatic — by the metrics and by the anecdotal evidence. From February 2021 to December 2022, social media reporting highlights included:

• 10,000 followers (up from 8,167) on LinkedIn in 22 months
• 699,419 impressions (96.4% increase)
• 52,873 engagements (578.5% increase)
• 27,952 post link clicks (2,012.8% increase)
• 6% engagement rate (245.5% increase)

 

---

 

CASE STUDY

Learn more about how Campus Advantage and Catalyst’s rebrand strategy and reputation management services successfully guided Redtail to a 30-point ORA® score increase, 100% occupancy, and increased resident retention.

100%
OCCUPANCY FOR MULTIPLE YEARS

37%
RENEWAL RATE IN FALL 2019

30
POINT INCREASE IN ORA SCORERead More

 

---

 

NOTABLE COVERAGE

The March/April issue of Student Housing Business featured appearances from the Campus Advantage team, including:

• Lindsay Brown, Senior VP of Leasing and Marketing: “The SHB Interview: Collective Strength” (page 28)
• 2023 InterFace Platinum Sponsor: Page 73

 

---

 

EXPERIENCE THE
INSIDE ADVANTAGE

We have several opportunities to engage with our team of industry veterans:

Contact us to leverage our expertise to your advantage in your student housing strategy.
Contact us