Global Student Accommodation Group announces multi-billion dollar us joint venture with a fund advised by Morgan Stanley Real Estate Investing.
14 December 2021
This alliance is founded on a strategic vision to become a leader in US student housing. The JV marks the beginning of a long-term relationship that will pursue strategic growth across the full spectrum of the student housing industry.
To begin this partnership, GSA brings $1.6bn of initial seed assets to the JV, with close to 15,000 beds across 21 states and 29 cities. These properties include GSA’s existing US portfolio acquired in 2020, along with the recently closed acquisition of more than 8,100 beds across prime locations from coast to coast. Together, nearly two-thirds of the portfolio are at prestigious Power Five schools.
MSREI’s commitment represents a major endorsement of the strength, resilience and stability of student housing in the higher education sector.
Representing a powerful combination of GSA’s unparalleled experience, market access, intelligence and international reach alongside the breadth and depth of MSREI’s exceptionally talented investment team and long standing global franchise, this alliance is testament to GSA’s expertise and ability to deliver scale as a best-in-class partner specializing in all aspects of student housing with a uniquely integrated operational offering.
Under the partnership, Yugo, GSA’s global brand and operating platform, will drive greater customer access to Generation Z, data and performance through its differentiated student-led and sustainable approach. Yugo provides living experiences to ensure students’ intellectual, personal and professional growth is supported throughout their higher educational journey.
This JV is a significant building block for both businesses in the US and will support GSA’s growth strategy as it accelerates further. TD Securities acted as exclusive financial advisor to GSA with legal and tax advice provided by Greenberg Traurig and Goodwin Procter.
Alec Burger, Chair of GSA stated: “This is a significant opportunity for both GSA and Morgan Stanley Real Estate Investing to together make a meaningful impact in the market. Since entering the US market, GSA has been deliberate in executing its growth strategy, proven by our most recent acquisition, enabling us to seed this partnership with a sizable and highly attractive portfolio.
With an experienced investment partner, who we share great cultural alignment, we are united in a desire to be a true leader in US student housing for many years to come. Having a permanent JV partner of MSREI’s caliber provides the opportunity for sustainable growth in the US market as well as the ability to replicate what we have successfully achieved in other global markets.
“The US is the largest student housing market in the world and will continue to be underpinned by demand for higher education, both domestically and internationally. Through this opportunity, we have the ability to increase our market share, deliver sustainable returns and, importantly, through Yugo, support our students by providing safe living spaces and unique experiences.”
John Klopp, Global Head of Real Assets at Morgan Stanley Investment Management stated: “After careful study of the student housing market, we looked for a scalable opportunity and a best-in-class partner for our entry point – this venture achieves both. We believe that the combination of MSREI’s broad real estate investing platform and GSA’s thoughtful, innovative approach to the sector will allow us to deliver attractive and differentiated exposure to our investors.”