KKR lands $1.64bn student housing portfolio from BREIT

The portfolio acquired by KKR will be managed by University Partners, a leading owner and operator of student housing across the U.S.

BREIT acquired this portfolio in 2018 in a joint venture with Greystar Real Estate Partners, LLC | PBSA News
BREIT acquired this portfolio in 2018 in a joint venture with Greystar Real Estate Partners, LLC

KKR and Blackstone Real Estate Income Trust, Inc (BREIT) announced a definitive agreement for funds managed by KKR to acquire a portfolio of 19 purpose-built student housing properties from BREIT for approximately $1.64bn.

The over 10,000-bed portfolio is comprised of 19 purpose-built, premium student housing assets.

The communities feature a wide range of best-in-class amenities and the majority are located with easy pedestrian access to campus. BREIT acquired this portfolio in 2018 in a joint venture with Greystar Real Estate Partners, LLC (“Greystar”).

“Student housing is a sector that we have long-term conviction in. We are pleased to be working with Blackstone to complete this transaction, which will add a diverse mix of high-quality properties to our portfolio.

“The operating capabilities we have built with University Partners over the past decade, and our ability to transact at scale position us to create value for our investors and to continue investing in great living experiences across these communities. We are deploying into what we view as a compelling market environment to purchase quality real estate.”

Justin Pattner, Partner at KKR and Head of Real Estate Equity in the Americas.

University Partners

Upon closing this deal, the portfolio will be managed by University Partners. The company is a leading owner and operator of student housing across the U.S. 

KKR launched University Partners in 2016 with a team of industry veterans. It was part of its strategy of creating vertically-integrated platforms to build scaled exposures to attractive real estate sectors.

“This transaction is an excellent outcome for BREIT’s investors and demonstrates the strong demand for the high-quality assets in attractive markets that BREIT owns. We continue to have long-term conviction in student housing and are actively growing through BREIT’s student housing platform, American Campus Communities (ACC), which is the largest owner of student housing in the U.S.”

Jacob Werner, Co-Head of Americas Acquisitions for Blackstone Real Estate.

Inclusive of the pending acquisition, University Partners will own and manage over 25,000 beds, representing nearly $4bn of property value.

Student housing in the USA

Blackstone is the largest owner of student housing in the USA. They posses OVER 190 properties, representing approximately 140,000 beds.

Since acquiring ACC in 2022, Blackstone has enabled ACC to build more student housing. They have broke ground on four new student housing communities since autumn 2023. ACC expects to welcome students to six additional new communities across the country in 2024.

“This is a high quality, scaled portfolio of purpose-built student housing assets serving the country’s leading four-year public universities. Approximately half of the portfolio is in markets where we have existing operating experience, and this transaction will enable us to expand our presence into a number of attractive new markets.

“We believe student housing in the top university markets will continue to benefit from strong enrollment growth and structural constraints on new supply.”

Travis Roberts, Chief Executive Officer of University Partners.

In November last year, iQ Student Accommodation (iQ) announced that it had supported Blackstone in the acquisition of two PBSA assets from Downing Students.

The acquired assets include the 841-bed Vega in London and the 324-bed The Mont in Edinburgh.