A local development company sold a pair of student apartment complexes in Dinkytown Friday.
Doran Companies sold The Bridges and The Knoll to TH Real Estate, a global real estate investment company, for $93 million, which some say shows the student housing market remains in high demand.
Doran Cos. received multiple offers, but sold to TH Real Estate for its strong reputation, said Anne Behrendt, chief operating officer for Doran Cos.
Behrendt said Doran Cos. initially identified a need for student housing that was still absent from the University campus areas.
Doran Cos. built Syndey Hall, Dinkydome Buildings, The Bridges, 412 Lofts, The Knoll and Edge on Oak — all located within the University of Minnesota area and heavily concentrated with University students.
Aside from the creation of the 17th Avenue Residence Hall in 2013, there has been no new University built housing. In lieu of that, several other options have come up for students, like Doran’s.
The University area also saw the rise of WaHu Apartments in 2015 and other housing projects and proposals have been built in the Marcy Holmes and Southeast Como neighborhoods.
With the sale of The Bridges and The Knoll, Doran has now sold all its main University apartments.
While this sale marks the end of the Doran’s development plans in the University area for now, it signifies a strong demand for student housing.
“The demand is driving strong prices,” Behrendt said. “It was the right time to sell.”
In an email, TH Real Estate’s Director of Asset Management Public Relations, Daisy Okas, said the property will remain as student housing.
Ed Goetz, a University professor who specializes in housing, said there is a significant demand for student housing opportunities near the University.
“It’s a great market niche to get into, so a lot of developers are responding to it,” Goetz said.
Several new apartment complexes underway also indicate a hot market, he said
The Rise in Prospect Park, and The Hub in Stadium Village both plan to host various kinds of tenants, including students. Both are currently under construction and The Hub plans to open in the fall of 2018.
Goetz said the University area housing market will go on for a while without becoming too saturated with housing options.
“[The University] was primarily a commuter school and the development both on campus and directly off campus housing is … fairly new,” he said, “So I think there’s still some room in the market.”