A report from the Philadelphia Inquirer in Pennsylvania. "When Toll Brothers cofounder Bruce E. Toll paid $23.5 million for a 552-bed student housing complex near Kutztown University eight years ago, record-smashing enrollment at the Berks County college was translating into huge demand for rooms."

"Since then, Kutztown’s student population has plummeted nearly 20 percent, and BET Investments Inc., which Bruce Toll formed in 1998 to diversify beyond his home-building roots, lost the Edge at Kutztown apartments earlier this year to foreclosure."

"Toll’s experience in Kutztown has echoes nationwide — especially in the population-losing Northeast — as slowing enrollment growth tarnishes student-focused housing’s reputation as a recession-safe real estate bet."

"'If you combine increased supply with enrollments that are decelerating at most schools — and turning negative at a lot of smaller schools — you end up with more beds than students,” said Rob Goldstein, who helps manage Plymouth Meeting-based CenterSquare Investment Management LLC’s real estate securities portfolio. 'I think that’s starting to catch up with the industry.'"

"The delinquency rate for non-government-backed commercial mortgage-backed securities — a type of bond composed of property loans — for student housing projects spiked at a high of 9.4 percent in February and remained elevated in March and April, according to the debt tracker Trepp LLC, which began monitoring the asset class in 2004."

"Only a fraction of the nation’s student-housing properties involve CMBS financing, which is more trackable than other forms of debt, but the conditions behind those missed payments appear to be widespread."

"Nationwide, undergraduate and graduate-student enrollment, including part-timers, fell by about 5 percent to 22.3 million in 2017, the most recent year for which U.S. Census estimates are available, from the start of the decade."

"During that same period, though, student-housing supply increased by more than 47 percent nationally to more than one million beds, according to an Inquirer analysis of data from market tracker CoStar Group, which excludes projects with fewer than five living suites."

"Worst off are middle-tier schools in low-growth regions, such as Kutztown. Enrollment 'used to grow because every year there were more high school raduates than there were the year before,' said Alex Bloom, a consultant with EAB Global Inc . 'We’re now at a period where that’s going to decline precipitously.'"

"The dorm-building boom benefited small, regional campuses because it enabled them to claim a greater share of the growing college-bound cohort than could have been accommodated by their existing stock of homes."

"And fueling much of the construction was an appetite for student housing among investors, who saw the projects as good shelters from bad economic times because university enrollments are generally unfazed by downturns, said Goldstein of CenterSquare."

"A big portion of that investment came from overseas pension and sovereign wealth funds, such as the real-estate arm of Singapore’s state investor Temasek, which last year added the 850-bed Evo at Cira Centre South tower in University City to its already large portfolio of student housing in the United States."

"As a result of this investor interest and temporary enrollment uptick, 'there have definitely been assets in certain markets that shouldn’t have been built,' said David Adelman, chief executive of Philadelphia-based Campus Apartments LLC, which owns or manages properties serving about 50 schools in 18 states. 'You’ve had developers who haven’t looked at data at all and it was all determined by their ability to find a piece of land and obtain bank financing.'"