American Campus Communities Sees Healthy Supply Student Housing Demographics in Core Markets

Bill Bayless, CEO of American Campus Communities (NYSE: ACC), participated in a video interview at Nareit’s REITworld: 2018 Annual Conference in San Francisco.

Bayless said that supply demographics in ACC’s core markets continue working in the company’s favor.

“New supply coming in next fall is up [at] 28,000 [new beds] from 26,000,” he said, noting though that the concentration per market is down. “[New supply] is spread over 34 markets, where last year it was over 27.”

Bayless said the only market ACC sees potential concerns with is Florida State University in Tallahassee. “We have a second year of large supply coming in at about 2,168 new beds, so we’re watching that one closely,” he noted.

Bayless said the surge in private investor interest in the student housing space has “been an incredibly positive thing for the space—it's really helped the maturation of cap rates.”

He added that ACC is not seeing much movement toward more universities changing or implementing on-campus housing requirement for students, but that when the REIT does see that, it doesn’t view it negatively.

“The student who is most likely to live in an American Campus community is the student who started their first year on campus…[and] saw the benefit of that academically-orientated environment,” Bayless said. “We’re the off-campus alternative that has that same management philosophy and academic orientation.”