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Erik Hayden Aug 17, 2022 10:33:17 AM 6 min read

Student Housing: Still a Growing Opportunity

San Jose State University is home to about 36,000 students and 4,300 employees, a population that would make it a pretty good-sized city in its own right. Unusual among major universities, about 97% of those students live off-campus, according to U.S. News. While some of these students live at home and commute, many don’t. At the same time, the number of students moving to San Jose seems to be growing, adding to the shortage of available student housing. 

In 2019, the country’s 175 biggest universities provided on-campus housing for just 21.5% of undergraduates, according to research from CBRE. As might be expected, vacancy rates were low, averaging less than 2.5% for the period 2016-2019, according to data from Reis. And now, student populations are projected to start growing again, up an average of 1.1% a year through 2031, by one estimate. 

Locally, the problem is compounded by the fact that San Jose State just missed out completely on the $1.4 billion in affordable housing grants made to 26 in-state universities by California. Recognizing the need for student housing, investors have stepped in to pick up some of the slack, with over $5.8 billion of capital making its way into the sector in 2019, according to Newmark Knight Frank. 

All this helps explain the thinking behind The Mark. The Mark is a high-rise student housing tower located less than a block from the San Jose State campus. That location puts it within walking distance of both classes and the restaurants, recreation, and retail of the SoFa Arts district. When completed, it will provide about 1,000 student housing beds.

Because real estate projects take time to build successfully, anticipating the long-term trends that shape the market is critical. The projects in our Fund I and Fund II address emerging needs for downtown San Jose, including multifamily residential, senior living, and office as well as student housing. Collectively they’re part of an emerging new and exciting city.

To find out more about how you can invest in these trends, go HERE.


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