More than a year after selling Spain’s largest student accommodation provider, Greystar Real Estate Partners has returned to investing in the sector.
The South Carolina-based manager has acquired a vacant plot on the Cantoblanco Campus of Madrid’s Autonomous University from Texas-based manager TPG and Madrid-based manager Urbania.
Greystar will build a mid-rise student accommodation property on the site for €47 million on a total cost basis, comprising 435 beds and lifestyle amenities including co-working space and a gym. It will be operated under the firm’s in-house brand Canvas, which was launched last year and currently operates assets in the UK, France, Germany and the Netherlands. The firm expects the asset to be operational by September 2025.
PERE understands the land acquisition was made through the firm’s value-add fund, Greystar Equity Partners Europe I, which closed on €1.55 billion in July 2022 per PERE data. Greystar declined to comment on the fund, but market sources familiar with the matter said the vehicle is close to being fully deployed.
Greystar previously sold RESA, Spain’s largest student housing business, with AXA IM Alts and CBRE Investment Management to Dutch investor PGGM‘s Infrastructure Fund for €900 million in 2022. It was acquired jointly by the managers in 2017, and grew to 11,000 beds across 42 assets by the time it was sold.
Rafael Fernández-Villaverde, Greystar’s senior investment director for Southern Europe, told PERE the decision to return to the Spanish purpose-built student accommodation market was driven primarily by acute undersupply.
“Our research indicates Spain currently suffers from a student-to-bed ratio of 14:1, which is approximately a 7 percent provision rate. London and Amsterdam, for example, are at 3 or 4 students per bed, so there’s a significant spread in those markets,” he said.
This particular university is also one of the most undersupplied for student beds in the city, he added, with around 800 beds for more 30,000 students at present.
The plot has been acquired with a construction license already in place and so work on the site will begin immediately, said Fernández-Villaverde. Construction financing has been agreed with Banco Santander at a leverage point of 55-60 percent.
“It’s a smaller deal than what we have been used to doing in Spain, but nonetheless we felt the opportunity was attractive enough to dedicate resources to a bite-size opportunity,” he added.
Eyes on Spain
The Spanish PBSA market is set for considerable growth. A report by Savills and The Class Foundation projects over €12 billion is set for investment in European PBSA in the next two to five years, with Spain expected to receive the largest proportion of this.
The Cantoblanco development site is the only PBSA asset Greystar holds in Spain at present, but it has actively invested in build-to-rent housing in the country this year. In March, the firm acquired a portfolio of 2,425 rental housing units to be delivered through 2025 from property developer Vía Célere, in a joint venture where the latter retained a 45 percent stake in the portfolio. The deal was worth €400 million.
“Spain continues to be a target market. After the UK, it is the country where we have committed the most capital in our value-add strategies in Europe,” said Fernández-Villaverde. He expects to see further opportunities in Southern Europe, including in Portugal and Italy, over the coming 12-18 months as a result of the modest spread between expected real estate returns and investment-grade corporate bond yields in Southern Europe, meaning further price declines are likely.
“We believe Spain and Southern Europe still offer a significant yield premium to other European countries,” he added.
Juan Manuel Acosta, the former managing director for Spain and head of southern Europe who was appointed shortly after Greystar’s acquisition of the RESA platform in 2017 and oversaw its sale in 2022, left the business in June this year. In September, he was appointed CIO and head of Spain at Dutch manager Rockfield Real Estate.
To replace Acosta, Greystar did not appoint a regional head. Instead, leadership of Southern Europe is shared among five multidisciplinary executives, including Fernández-Villaverde who leads the investment function.
If you do not receive this within five minutes, please try to sign in again. If the problem persists, please email: 
