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Scion, CPPIB and GIC To Acquire 21-Property University House Communities

InvenTrust Continues Divesting Non-Multitenant Retail Properties
January 4, 2016
Scion Communities Investors LLC, which formed a joint venture with a pair of institutional investors to acquire student housing properties located primarily within major university markets in the U.S., has signed an agreement to acquire University House Communities Group from InvenTrust Properties Corp.

The portfolio includes InvenTrust’s 21-campus portfolio of 18 stabilized student housing complexes and four properties currently in development. In total, the deal comprises nearly 13,000 beds for a total consideration of $1.4 billion, or about $107,692/bed.

The student housing properties are located in Alabama, Arizona, Arkansas, California, Colorado, Florida, Georgia, Louisiana, North Carolina, Oregon, Pennsylvania and Texas.

The Scion-sponsored venture, Scion Student Communities LP, is backed by the Canada Pension Plan Investment Board (CPPIB) and GIC, a private soverign wealth fund wholly owned by the Government of Singapore.

"The UHC portfolio represents a valuable opportunity to enter the U.S. student housing sector with top-tier, well-located assets," said Peter Ballon, managing director, head of real estate investments in the Americas for CPPIB. "This transaction enables us to gain immediate scale in the attractive U.S. student housing market. We look forward to working with GIC, an existing partner, and Scion, an experienced operator, on the UHC portfolio as well as future student housing investment opportunities in the U.S."

Scion will manage and operate the portfolio. The transaction is expected to close in mid-2016.

The sale of its University House portfolio follows InvenTrust's decision to focus on investing in its multi-tenant retail platform.

"While University House has been a valuable component of InvenTrust’s portfolio, we are very excited about this transaction, which represents the conclusion of a robust evaluation process to maximize the value we receive for the platform," said Thomas McGuinness, CEO and president of InvenTrust. "Following this important step and the recently announced spin-off of our non-core portfolio, we remain committed to our strategy of refining and tailoring our pure-play retail platform."

Last month, InvenTrust announced plans to spin off its noncore properties into a newly formed nontraded REIT to be known as Highlands REIT Inc. The self-managed Highlands REIT will own a diverse portfolio of seven single- and multi-tenant offices, two industrial assets, six retail properties, two correctional facilities, four land parcels and one bank branch.

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