How active is the Houston student housing market?

How active is the Houston student housing market close to Huston University? There are some reports that a lot of investor money is rushing to the Texas student housing market, which will create huge supply in the next 2-3 years. Is that true?

  • Jessica Graf

    Seyfarth Shaw LLP
    February 09, 2018

    This is more of an empirical and due diligence question; rather than a legal question. I would recommend working at first blush with a consultant who specializes in university and campus enrollment trends. While an attorney can assist you with the transaction, if you should want to invest in the housing market, the trends, enrollment forecasting and the expansion of the university itself would be better addressed by a specialist in this area.

  • Robert J. Ivanhoe

    Greenberg Traurig, LLP
    February 09, 2018

    I am not especially familiar with the student housing market in Houston as I live and practice in NY. However, for student housing market assessment, you need to look at where the largest universities are, their growth and existing student housing stock. In Texas, I would think that Austin, home of the University of Texas, would be the strongest market. I would think Dallas and Fort Worth next given SMU and other colleges there. Houston is based on the University of Houston which is not of the same pedigree or state financial support. But, more research should be conducted for a proper conclusion.

  • Brooks Clark

    February 09, 2018

    My market experience is limited to the New York real estate market. A commercial real estate lawyer in Houston, TX, can likely respond more effectively to these questions.

  • Eric Ching

    Ching & Seto, APC
    January 16, 2018

    I'm not familiar with the Houston housing market. However, I have heard there are many students in Houston and it is a growing city. Whether or not it will create a supply is unclear. I recommend you contact a local Houston real estate expert to get a better idea of the housing market.

  • Sheri Chromow

    SPC Advisors, LLC
    January 11, 2018

    While I am generally familiar with the Houston market, the vantage point comes from having worked on a recapitalization for a Houston office building. I learned that, while the market is expected to improve, the turning point has not yet been reached. I work with experts to whom I would refer you.

  • Dan Flanigan

    Chair, Real Estate and Financial Services Department, Polsinelli
    January 09, 2018

    I cannot speak to the University of Houston market specifically (though I myself graduated from its law school many years ago now), but this is the situation generally with student housing in the U.S.: I am going to paraphrase what a very knowledgeable lender in the U.S. said this very day on a panel at a conference I am attending--the lender said he would "kick out" (i.e. require the loan to be removed) any student housing loan from any securitized pool in which he invested unless it was "on campus at a major university" because there is way too much capital flooding into the sector and because the fundamentals in the sector are not good. So be very careful.