The Stretch - University of Kentucky_Property for Sale
The Stretch - University of Kentucky_Property for Sale
1051 Red Mile Rd, Lexington, KY, 40504-2787, US

The Stretch - University of Kentucky

Asset Description

Jones Lang LaSalle Americas, Inc. (“JLL”) is pleased to present The Stretch (the “Property”), a 170 unit / 533 bed student housing community serving the University of Kentucky (the “University”). The Property achieved 96% occupancy for the 2023- 2024 academic year, and is fully leased with 10.8% rent growth for the 2024-2025 academic year.


The University of Kentucky student housing market was 99% occupied for the 2023-2024 academic year, and is currently 100% pre-leased. Commensurate with rent growth achieved at The Stretch, the student housing market has achieved 10.3% rent growth in 2024 after achieving over 15% rent growth in 2023.


Enrollment at the University increased by 7.4% in 2023. There is currently no off-campus student housing development planned, and between on and off-campus beds, less than half of the student body is served by existing beds. These fundamentals suggest continued strength in occupancy and rent growth.


Popularity of the University of Kentucky has grown as a result of #1 ranked academics in the state, elite athletic programs, and a stateof- the-art campus supported by over $5 billion in infrastructure funding. Given the growth trajectory of the University and future stability of supply/demand fundamentals, The Stretch is positioned to continue achieving near-full occupancy and high rent growth.

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Attributes

Number of units
170
Occupancy
96%
Year built
2009

Media

Investment Highlights

100% OCCUPIED AND 10.8% Y-O-Y RENT GROWTH; MARKET-TO-MARKET OPPORTUNITY

The Stretch has proven to be a desirable property for students, achieving full occupancy for the 2024-2025 academic year at rents 10.8% above 2023 rates. Even with this performance, The Stretch is still priced at a $100 - $150 discount to comparable properties. New ownership can mark rents to a $75-$125 discount on AY 25-26 market comparables and unlock an additional $760,000 in revenue.


99% OCCUPIED MARKET WITH 27% RENT GROWTH SINCE 2022

Supporting performance at The Stretch is an equally strong performing student housing market at the University of Kentucky. The market was 99% occupied for the 2023-2024 academic year and is currently 98% pre-leased. Market rents grew by 10.3% in 2024 after increasing 15% in 2023; the market has grown rents at least 4% each of the past four leasing cycles. The student housing market at University of Kentucky has consistently proven it can fill beds while growing rents.


7.4% ENROLLMENT GROWTH, 0 BEDS IN PIPELINE, OVER 50% UNMET DEMAND

The University of Kentucky offers strong future fundamentals in an already high performing market. The University grew enrollment by 7.4% in 2023, and announced that 2024 enrollment will once again set a new record, with a record 6,500 students in the class of 2028. A fast-growing student body has created a substantial undersupply of student housing, with 15,600 purposebuilt beds on and off-campus accounting for less than half of the 33,900 students enrolled. Further, there are no off-campus beds in the development pipeline and there is no on-campus living requirement at the University.


ELITE ATHLETICS AND $5.4 BILLION INFRASTRUCTURE INVESTMENT AT UNIVERSITY OF KENTUCKY

University of Kentucky will remain a popular destination for students as a result of its excellent lifestyle offerings. In addition to serving as the #1 academic university in Kentucky, the University offers students one of the best athletic programs in the nation and a state-of-the- art campus. Kentucky Athletics has won 13 national championships, including 8 in basketball, its most famous program. The University has also approved $5.4 billion in campus infrastructure investment in the 2000’s, including construction of a brand new student center in 2018, and ongoing construction of new academic and research centers.

The Stretch - University of Kentucky 4_Property for Sale
The Stretch - University of Kentucky 4_Property for Sale

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Last updated
6 Nov 2024