Nuveen and Subtext Partner on New Student Housing Development Near University of Central Florida

In a significant move to expand student housing options, Nuveen Real Estate and Subtext Living have partnered to develop a new student housing community near the University of Central Florida (UCF). This collaboration marks a substantial investment in the growing demand for high-quality student accommodation.

Acquisition and Development Details

The partnership involves the acquisition of a 3.1-acre site previously occupied by a Fairwinds Credit Union branch. Located at 3133 N. Alafaya Trail, the property was purchased for $12 million. This site will be transformed into a 626-bed student housing community named 'Verve Orlando,' following the approval of an application in July 2023 and the issuance of a demolition permit in September 2024.

Subtext Living, known for its Verve brand of student housing, has a robust portfolio of similar projects across the United States. The Verve brand is characterized by its modern amenities and community-focused living spaces, with an average of 594 student housing beds per location.

Market Context and Demand

The student housing market near UCF is experiencing significant growth, with over 15,891 completed off-campus student housing beds and an additional 1,849 beds under construction as of July 2024. Pre-leasing rates are strong, with a 95.3% pre-leasing rate, although this is down 4.3% from the previous year.

Local developers and investors are also expanding their student housing portfolios. For instance, Orlando-based Deven Group aims to grow its student housing portfolio to over $1 billion in value over the next three years, which would equate to roughly 8,000 beds.

Partnership and Future Outlook

The partnership between Nuveen and Subtext Living underscores the growing trend of collaborations between real estate investment firms and development companies to meet the increasing demand for student housing. This project is expected to benefit from its prime location near UCF, offering students modern living spaces with easy access to campus and local amenities.

Nuveen's involvement in this project aligns with its broader strategy to invest in high-quality housing assets, including Purpose Built Student Accommodation (PBSA), which is seen as a key sector for future growth and stability.