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Why Greystar's Faith Likes Student Housing

Student Housing

Digested from Bisnow

EdR’s long track record of university partnerships to privatize student housing at big schools was a major attraction for Greystar’s Bob Faith. But the student sector itself also held appeal.

While Greystar has been in the student housing business since its 2009 purchase of JPI, it has been more involved in the development and ownership side of the sector internationally (it is one of the largest owners of student housing in the United Kingdom). It’s recent purchase of student housing REIT EdR changed that.

Greystar’s was not just attracted to EdR’s communities. It also liked the Memphis-based company’s relationships.

“What we realized, and what I found intriguing about EdR, was with them and ACC, the other public company, those two did the vast majority of university partnerships to privatize student housing on big universities in the U.S., which is a fantastic business,” Greystar Chairman and CEO Bob Faith told Bisnow’s Jon Banister. “One of the compelling things about acquiring EdR was their track record and history and pipeline of student housing redevelopment and new development in partnership with universities. They were a public company that was a little stuck, their stock price was down and they weren't able to raise new equity or grow.”

Faith also sees student housing as a strong hedge against a recession in the market-rate sector. “During the global financial crisis, enrollment went up, people went back to school to improve their skills or change their focus to get a job,” he told Banister. “The sector is not without headwinds and concerns about the internet replacing universities and everybody will get online degrees and people won't go to college. I fundamentally disagree with that. The college experience is so ingrained in our culture. Yes, there are certain for-profit, small, liberal arts colleges that will be hurt by some reduction, but I firmly believe big research universities, state universities, places that offer the whole university experience, they're continuing to grow and will continue to be successful no matter what part of the cycle we're in.”

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