Demand for on- and off-campus student housing units continues to grow as university enrollment picked up again, after declining gradually between 2010 and 2017. Data from the National Center for Education Statistics shows that 19.9 million students are expected to start their college or university studies this fall, compared to 19.8 million last year.
Proximity to campus is still helping drive stronger performance, but other factors are contributing as well. According to Yardi Matrix, EdR owns 41 student housing properties across the U.S., with metro Phoenix as its main market (1,012 units), followed by Denver (740 units) and Bridgeport-New Haven (618 units). Earlier this year, the company broke ground on the $67 million College View, which, upon completion, will add 1,600 units to its growing portfolio.
EdR’s Senior Vice President of Acquisitions and Development Scott Barton discussed the main drivers behind the growth in the student housing sector and revealed his expectations from the business going forward.
What are the major trends in student housing this year?
Barton: College students like to have their pets around, so both new and existing communities are bringing in pet-friendly amenities such as washing stations, dog parks and pet relief areas in outdoor common areas. The generation of students we house are very active in the shared economy, so amenities like on-site bike shares, car shares and dedicated rideshare pickup areas are gaining in popularity.
Could you single out one trend that is gaining popularity in this sector?
Barton: Technology friendly group study areas are getting more and more use in our communities.
What are this year’s hottest markets for student housing?
Barton: Many of the universities in the state of California are facing severe housing shortages, so if you can get a deal made there, your odds of building a successful community are great. We have identified a list of top 20 markets that we are targeting for development.
What can you tell us about cost-efficient construction methods?
Barton: They are more and more vital to making a deal work. Using materials like prefabricated design systems can save a project both time and money.
What are the top three amenities in student housing communities?
- Location: The closer you are to campus, the better.
- Privacy: This generation of students hasn’t had to share a bedroom or bathroom growing up the way previous generations have, so bed-bath parity is a must.
- Wi-Fi: Available bandwidth and signal can make or break a community. It’s almost at the point where high-speed Wi-Fi has evolved into a utility rather than an amenity, but it’s still a huge selling point.
What are EdR’s expectations for the student housing market in the second half of 2018?
Barton: We believe there are plenty of opportunities for smart growth. With so many new players finding their way into the sector, you have to do your homework when selecting a new or existing market to build in.
Images courtesy of EdR