How To Attract Student Renters in a Competitive Market
- Aug 18, 2015
Student housing is going through what could be considered the most interesting facelift ever. Millennials’ use of technology and preference for an abundance of amenities combined with increased enrollment in higher education is changing the way student housing is produced. It’s also pushing the increase of private sector development of student housing. Jeffrey Resetco, vice president of real estate development and construction at EdR, discussed new projects in the works and what’s to come for the future of student housing.
What does EdR have in the development pipeline?
We have a fourth stage of our development at the University of Connecticut that is going to take our total students in residence up to 1,010. That project is delivering this summer, and we’re excited about that. We have a brand-new project at the University of Georgia in Athens opening this summer. Both of those projects have retail in the ground floor, leasing for retail has been going really well so we have some great new tenants in both of those developments.
Retail has increased in student housing over the past few years and EdR is in the same situation as a lot of the other developers where we do include retail on the ground floor. In these two situations, the retail has been successful—we feel it will be a nice amenity to our residents and it adds to the interest in the project. We always target a good mix of local and national tenants for our retail space. We are continuing our development at the University of Kentucky and that project will add approximately 2,000 additional beds in 2015 and 2016 so that’s exciting for that campus. We have a project that is opening at the University of Louisville and that is one of our cottage-product developments. That project should be consistent with the quality of other projects we have in that style such as The Retreat at State College at Penn State and The Retreat at Oxford at Ole Miss. Those projects are very similar to the new one at Louisville opening this summer.
What are some of the most exciting amenities you’ve added or plan to add to your assets?
Globally, we’re seeing a continued trend of resort pools and high-end fitness rooms as the top amenities. The other thing we consider a real amenity is high-speed internet and we’re continuing to push the envelope on the speed that we deliver internet to our residents. We’re always trying to add more bandwidth to make any online experience as seamless as possible for the residents.
Are you analyzing what Generation Z will want?
I think a lot of the needs will be very similar. We’ve seen a number of the newest generation interacting with our sales staff and operations team on a continued mobile basis. Obviously mobile is very quickly overtaking the standard methods that are used by our residents for contacting our leasing office, signing leases, paying rent, putting in work orders, making comments that they’re referring to friends etc. All of those things are multiplying from a mobile platform, so we see that continuing to increase.
As far as the other needs, we’re continuing to study parking as a need and we haven’t determined whether that’s going to be a change from the resident types that we have now, but it’s possible the number of students with a car will change so that’s something to look at for the future: are residents going to continue to have cars at our properties or are students going to look to public transportation, biking, walking, or other means of transportation? We haven’t made a determination yet, but I think we and our peers are looking at the next generation to see whether they’ll have the same requirement for parking.
How will it affect your business model?
Parking is a major cost to developers, especially in urban markets where parking has to be structured and sometimes underground or within the buildings. If we feel that’s going to change and the parking number could be reduced that would help our overall cost of development. As far as from a mobile standpoint, I don’t think it will really change our methods. We’re in a good position to accept that type of communication throughout all of our properties—it won’t change our staffing or customer service in any way, but I think it will help residents feel they can connect to us more quickly.
What else do our readers need to know?
We are seeing an increase in university partners looking to partner with private student housing companies in developing student housing on and adjacent to campus mostly through the public RFP process. They have been contacting us and our peers in order to develop a student housing solution; in most cases it does involve mixed-use, retail and/or community space. We do have a number of those proposals and pursuits that are ongoing at the moment, but we’ve seen an increase throughout the country at all types of universities. I think the reasons for that are related to financing options we can provide to the universities, speed of delivery and the quality of development and expertise. The universities just don’t have the university expertise on staff, and in a lot of situations we can develop the project faster than they can just because of our nature of being a private company.
Development cost continues to increase. We see construction and land costs continuing to increase across the country. That’s one of our biggest challenges right now with development. The overall industry, I know, is in the same situations we are. We like to take advantage of the favorable development situation, and in some instances it’s a little more difficult based on the costs of construction and land. That’s something that’s putting everybody on notice.