Strategic Student & Senior Housing Trust Sells Final Student Property for $72.25 Million
Strategic Student & Senior Housing Trust Inc. – a publicly registered, non-traded real estate investment trust – sold its final student housing property for $72.25 million. The property is The District, a 198-unit student housing asset adjacent to the University of Arkansas in Fayetteville.
The buyer – YOUnion at Fayetteville SPE, LLC – is a subsidiary of a joint venture between an affiliate of Virtus Real Estate LLC, which will own 95% of the JV, and an affiliate of Strategic Asset Management I, LLC, the sponsor of Strategic Student & Senior Housing Trust. The affiliate of Strategic Asset Management I, or SAM, will serve as the property manager of the Fayetteville property on behalf of the joint venture.
SAM was formerly known as SmartStop Asset Management.
As reported by The DI Wire, the REIT acquired the property for approximately $57 million in June 2017, excluding acquisition costs. In December 2023, the REIT entered into a purchase and sale agreement of the Fayetteville property with a different purchaser, Walton Street Capital LLC. Walton ultimately passed on the sale transaction and the deal was terminated in January 2024.
In a letter to stockholders and as previously reported by The DI Wire, the company touted the improved operating performance of the Fayetteville property as reason it was able to achieve a $72.25 million sale price versus the once-planned $63 million sale price in Q4 2023 with Walton, an increase of 14%.
The net proceeds from the sale of the Fayetteville property were used to repay two loans: the mortgage loan encumbering the Fayetteville property at approximately $34.5 million, and the KeyBank Bridge Loan, which was approximately $25.5 million. The remainder of the net proceeds will be used for other corporate purposes, including but not limited to a disposition fee and reimbursement of fees and expenses owed to the adviser of the REIT, a subsidiary of SAM, and distributions to stockholders.
As of March 31, 2024, the REIT owned one student housing property and four senior housing properties. In January 2024, its board of directors approved an estimated net asset value per share of $6.34 for its Class A, Class T, Class W, Class Y, and Class Z shares. This represents an increase of approximately 4.3% from $6.08 NAV as of Dec. 31, 2022.
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