(Bloomberg) -- A Brookfield Asset Management Ltd. property fund bought a group of US student-housing communities for $893 million.
The 14 properties have a total of roughly 8,700 beds and serve schools including Texas A&M University, Dartmouth College and Indiana University, according to a Brookfield spokesperson. The purchase price was 36% less than what it would cost to replace the properties, and a 19% discount to recent trades, the spokesperson said.
Higher interest rates have pressured yields and values for housing assets, giving Brookfield opportunities to scoop up properties at attractive prices. This year, the company purchased or is in contract to buy $5 billion of North American residential assets, including 10 market-rate apartment properties in the US Sun Belt and Midwest regions.
For student housing, the company said it generally looks for properties near large, public universities with growing enrollments, and in areas with a limited supply of dorms.
Brookfield started shifting toward buying housing assets after disposing of more than $10 billion of the properties from 2020 to 2022, said Ben Brown, a managing partner at the firm’s real estate group.
“Like everything, yields have changed pretty materially, so values have reset,” Brown said. “We started searching for new opportunities where we still saw really attractive supply-demand fundamentals.”
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