Sale of North 38 Apartment Complex Sets New Valuation of Student Housing in Harrisonburg

Did you know Facebook is now estimated by some to be valued at $65,000,000,000?  Yes, that's $65 BILLION dollars.  How do analysts come to that number?  The valuation is based on the percentage stake that is given to a new investor as compared to the dollar value of the investment that they make in the company.  Just two months ago, a Goldman Sachs investment in Facebook put the value at $50 BILLION.

How does this relate to real estate in Harrisonburg, VA?  An investor just bought a significant stake in the student housing market in Harrisonburg, which provides another data point upon which other student housing owners can value their investment.

The big news --- 38 North has been sold for $32.8 million.

The specs of this recently built (2008) student housing complex include:

• 228 units (816 beds) built on 19 acres
• (96) 3-bedroom units
• (132) 4-bedroom units
  
• 94.6% occupied at the time of the sale
• sold for $143,640 per unit ($40,135 per bed)
  
• Amenities including a swimming pool, fitness room, tanning beds, spa, game room with billiards, computer lounge, basketball courts, barbecue grills, and a clubroom

With a 95% occupancy rate, it largely does not matter to 38 North, but I do wonder whether the buyers realize that there is a huge excess of student housing in Harrisonburg.

• Do Harrisonburg and JMU Need More Student Housing?
• Do You Think Harrisonburg's Student Housing Vacancy Rates Are High Now? You Haven't Seen Anything Yet!
• Everything Will Sell, At A Price (Hunters Ridge pricing)
• Harrisonburg Has A Tremendous Over-Supply of Student Housing for JMU Students