S3 Capital Lends $132M on Washington Heights Student Housing Development

Edge Property Group has sealed $131.5 million of construction financing to develop a student housing project in Upper Manhattan, Commercial Observer has learned.

S3 Capital supplied the loan to fund the development and refinance past debt on Edge Property Group’s planned 28-story student housing building at 465 West 165th Street in Washington Heights. The development, which will comprise 276 units and 321 beds, marks an expansion for S3’s foray into the student housing sector from its long-standing focus of traditional multifamily. 

“We have been watching student housing closely for some time,” Steven Jemal, managing director of origination at S3 Capital, said in a statement. “The supply/demand story mirrors what we see across multifamily, except in many university markets the imbalance is even more acute.”

Jemal added that the Washington Heights neighborhood is home to “thousands of students,” but the area has limited capacity to house them. 

Washington Heights is considered one of the most supply-constained neighborhoods in New York City for residential housing, with a vacancy rate of 0.8 percent as of the second quarter of 2025, according to S3. Only 14 units were delivered over the prior 12 months. 

“The world-class universities and medical institutions of northern Manhattan host thousands of students who need to live nearby, and the housing supply has chronically failed to keep pace,” Robert Schwartz, a co-founder and principal at S3 Capital, said in a statement. “Washington Heights is one of the tightest rental markets in New York City, and this project fills a need that has existed for years. We see significant potential ahead in markets like this.”

The student housing tower will encompass 148,074 of net rentable residential square feet. It will also house more than 11,000 square feet of amenity space, including private study pods, quiet lounges, a fitness center, a golf simulator and an outdoor terrace 

Institutional Property Advisors negotiated the debt with a team led by Max Herzog and Eric Toddy. 

Herzog said in a statement that Edge Property Group’s “deep market knowledge” positioned it to “identify and secure a rare site in an underserved area with significant student housing demand.”

Edge Property Group did not immediately return a request for comment. 

Andrew Coen can be reached at acoen@commercialobserver.com.