GMH Capital Forms JV with Principal Real Estate for Student Housing Acquisition Opportunities

Gary Holloway, president of GMH Capital Partners Gary Holloway, president of GMH Capital Partners

Newtown Square, Pa. — Before its sale in 2008, GMH's College Park Communities division was the largest student housing company in the country, with nearly 70,000 beds across 29 states.

GMH Capital Partners (GMH) has formed a joint venture with Principal Real Estate Investors to pursue student housing opportunities in various markets throughout the United States. The partnership will target up to $650 million worth of acquisitions in the next year and a half across three asset categories in student housing: existing core communities, development and value-add. The venture marks the major return to the sector for GMH, who developed and acquired a large portfolio of student housing assets before selling the majority to American Campus Communities in 2008.

According to Gary Holloway, president of GMH, “We were restricted for a good number of years, but we were just looking for the right opportunity to get back into the space.”

In an interview with SHB, Holloway said that now is a great time for the company to re-enter student housing citing that there is a better quality of product coming online; more seasoned developers; and not a lot of equity in the space.

“The resources were all here, it was just finding the right time and partner to get back in,” he says. “On the conventional multifamily housing side you may be competing against 20 groups, but in student housing we feel like we’re only going to be competing against five or six large groups.”

GMH’s first acquisitions will be best-in-class product from seasoned developers that get the brand back up and running, says Holloway. With an equity commitment of this size, GMH will consider both single-property acquisitions or portfolios. Each acquisition will have to be considered for its rent growth potential, supply and demand of student housing on and off campus, the university’s development pipeline and a property’s proximity to campus. 

Before its sale in 2008, GMH's College Park Communities division was the largest student housing company in the country, with nearly 70,000 beds across 29 states. After exiting the REIT, GMH concentrated on acquiring, operating and developing conventional multifamily assets. While not active in student housing for the past six years, GMH maintained its holdings in traditional multifamily, so it's management and culture are still in tact. Holloway says that will enable GMH to quickly absorb any new acquisitions in the student housing space.

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