Harrison Street's Canada Alternative Real Estate Fund has acquired two student housing properties in Kingston which cater to Queen’s University students.

The properties — 168 Division St. and 14 Garrett St. — were completed in 2022 and total 53 units and 145 beds. All the units are occupied.

The transaction is the 15th for the fund since it was launched in August 2021. During that time, Canada Alternative Real Estate Fund has closed on over $1 billion in investment value – though financial details for the Kingston acquisitions were not released.

Student housing is one of the key areas of interest for the fund.

Jonathan Turnbull, managing director and head of Canadian transactions and business development for Chicago-based Harrison Street, told RENX in an interview the acquisition embodies its interest in a sector it is “keenly focused on.” Strong demographics and rising university enrolment rates are driving growth and increased investor interest.

“Queen’s quite frankly typifies what’s going on in Canada with the lack of supply, but strong underlying demand,” he said.

Acquiring Division and Garrett

Harrison Street was driven to acquire the two properties because of the "demographic drivers", Turnbull said, as opposed to “GDP drivers”. Despite ongoing high demand for student housing, he cited a lack of new product in Kingston and many other university and college centres.

Division and Garrett are located between what the company calls “the most highly desirable nodes” of Kingston  – the Queen’s University campus and the city’s downtown.

168 Division St. offers two-, three- and four-bedroom apartment units, while 14 Garrett St. comprises two- and three-bedroom apartment units. Both properties are within walking distance of Queen's University and were developed by Highpoint Developments.

Varsity Communities, a Kingston-based property manager led by president and CEO A.J. Keilty, will oversee Division and Garrett. It currently manages just under 2,000 beds in Kingston and over 4,000 across Ontario.

Turnbull said he has known Keilty for years, and noted Varsity has a strong base of customers with deep roots in Kingston.

“A.J. and a lot of the senior (management) folks all went to Queen’s. They understand the market and therefore it’s a great opportunity for us to work with them in their home town around this project.”

Future student housing acquisition plans

Harrison Street has invested in over 1,200 student housing beds, with properties such as:

• ARIA, a six-storey, 286-unit apartment in Calgary’s University District;
• Le Mildoré, a 279-bed purpose-built student accommodation in Montreal; and
• Hillside Apartments, nearby the University of Ottawa.

It is developing Block 15, a 303-unit apartment project also geared toward students of the University of Calgary.

The firm will remain active in Canadian student housing, Turnbull said, with plans to close more transactions across the country. A pipeline of a combined 1,200 student beds will be announced in the next few months, he said.

“We are going to be doubling our Canadian footprint in student housing very shortly here,” Turnbull said.