US student housing investor to enter Dublin student housing sector

A US property investor has taken its first step in to the Dublin student housing market with the purchase of  the ‘Mill Street Building’ Dublin 8.

Harrison Street Real Estate Capital, a Chicago-based PE firm with $7.7bn under management, plans to invest around €250m with its eye on students from Trinity College Dublin and Royal College of Surgeons.

Harrison Street has formed a JV London-headquartered GSA Investment Management to provide student accommodation in Dublin over the next five years.

The Mill Street site will provide 400-beds in this undersupplied category of accommodation.

In a statement, the two firms said GSA’s Dublin-based team will “develop and operate the scheme and its new investment management business, “will be responsible for the management of the JV”.

For the past ten years, Harrison Street has focused on education, healthcare and storage in the US, areas where it sees “need-based or demographic investing” opportunities. While now, more than 4m students study outside their native country, that’s projected to grow to 8m in the next 10 years, so “the opportunity exists really to replicate what’s happened in student housing over here,” according to Christopher Merrill, Harrison Street’s co-founder and CEO.

“The UK and Europe, they’re behind in this type of asset class,” as local operators and developers haven’t spent the time to grow their expertise in it and develop projects, he said. Harrison’s buildings range from catering to the masses to high-quality, and are leased “by the bed,” often guaranteed by parents, said Mr Merrill. “It’s becoming a replacement for where kids have been housed, whether at home or in a small house or apartment,” he said. “You’re really becoming an extension of the university.”