Kayne Anderson Takes 161-Unit Student Housing Complex Near USC

The $55 million property opened this fall.

October 13, 2011
By Barbra Murray, Contributing Editor

In Los Angeles, a brand-new $55 million student housing development near the University of Southern California has changed hands in a transaction orchestrated by Institutional Property Advisors, a multifamily brokerage division of Marcus & Millichap Real Estate Investment Services Inc. Acting on behalf of Symphony Development and institutional investment firm CityView, IPA also found the buyer, Kayne Anderson Real Estate Advisor.

Developed by Symphony and CityView, the 161-unit West 27th Place sits adjacent to the University of Southern California and opened its doors in time to welcome students this fall. In addition to 392 beds in units featuring high-quality amenities and finishes, the property encompasses 10,000 square feet of ground-level retail space. Bus lines, light rail and USC’s tram system are all close at hand.  Additionally, the seven-story structure, which is registered for the U.S. Green Building Council’s LEED Platinum certification, ranks among the city’s top sustainable student housing developments.

“West 27th Place is the first brand-new, pedestrian-to-campus, mixed-use student housing development to close within a major coastal CBD in the sector during the past few years,” remarked Peter Katz, an IPA senior vice president. “Core student housing assets, located on smaller sites in constraint-restricted submarkets at Tier I universities, create demand from both market rate and student housing institutional capital at risk adjusted, compressed cap rates and yields.”

Financial terms of the West 27th Place transaction have not been disclosed; however, the property likely commanded a healthy price, given the slim opportunities to acquire student housing assets in the area. According to a Marcus & Millichap report, there were only two off-campus student apartment properties on the market in Los Angeles in September. Of those two, the higher price tag accompanies 30th Street Bungalows, a nearby 80-year-old asset that carries an asking price of $208,333 for each of its 12 units. As a brand-new property offering premier accommodations, West 27th Place almost certainly traded at a considerable premium to that asking price.