Jones Lang LaSalle Americas, Inc. (“JLL”), a licensed real estate broker is pleased to present the opportunity to acquire a ten-asset portfolio (“Yale Portfolio,” “Portfolio” or “Properties”) in New Haven, Connecticut that serves the students at Yale University (“Yale” or “University”). The Properties are located within a five-minute walk to campus and have delivered strong historical performance with consistent 100% occupancy for more than five consecutive years. During that time period, the Properties have delivered 10%+ annual rent growth, growing rents nearly 50% in the aggregate. The Yale market is one of the strongest markets in the country, with a ~3.7% total enrollment CAGR or ~17% aggregate enrollment growth through Covid over the last 5 years.
Ranked the #3 university in the country, Yale attracts applicants from across the globe who hope to enroll in the dozens of #1 ranked academic programs offered by the University. Yale received a record-breaking 50,022 applications in Fall 2022 – representing a 7% increase over last year and 42% increase over Fall 2019 – which pushed the University’s acceptance rate to an all-time low of 4.46%, making it the fourth most exclusive university in the nation.
The Portfolio offers proven value-add upside, with the opportunity to renovate and furnish the remainder of the Portfolio to generate outsized returns. To-date, 12 units, representing ~50% of the Portfolio, have been renovated and only 1 unit has been furnished. The renovations, together with market rent increases for AY 2023-2024 and embedded mark-to-market, have the opportunity to create an additional $185,800 per year in NOI on top of the $516,300 per year in in-place NOI.
One Of The Top Universities In The Country And World
- Yale is the #3 ranked university in the nation and continues to set all-new records. Enrollment has grown at a very strong ~3.7% CAGR over the last 5 years, representing a ~17% aggregate enrollment growth despite the impact of Covid. Yale received a record-breaking 50,022 applications in Fall 2022 -representing a 7% increase over last year and 42% increase over Fall 2019 - which pushed the University’s acceptance rate to an all-time low of 4.46%, making it the fourth most exclusive university in the nation.
Irreplaceable Locations Pedestrian To Campus
- The Properties are located just steps from campus, in the heart of the East Rock and Mansfield neighborhoods, which are the most popular areas among undergraduate and graduate students. A Portfolio of this size would be impossible to replicate today and has been carefully put together by the current owner over the last few years.
Exceptionally Strong Historical Performance
- The Properties have been 100% occupied for 5+ consecutive years and have achieved 10%+ average annual rent growth. For Fall 2022, the Properties achieved 24% growth, including rent increases from renovations.
Proven Value-Add Upside Opportunity
- There is an opportunity to increase annual rental income by an additional $185,800 for the next academic year through market rent growth, embedded mark-to-market and renovations to bring the unrenovated rents in-line with the renovated and furnished units in the Portfolio.
Significant Barriers to Entry
- New Haven’s infill urban environment, particularly in the East Rock and Mansfield neighborhoods adjacent to campus where students want to live, make new development challenging. Today, there are no purpose-built student housing assets in New Haven.