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Spencer Hayes' Blog

By Spencer Hayes | Agent in 36117

Not Your Parents' Student Housing

AUSTIN-At one time, a mention of student housing would conjure up visions of cinder-block walls, Formica floors, communal washrooms and metal cots with pancake-thin mattresses.  But experts tell GlobeSt.com that owners of successful student housing projects today offer all kinds of amenities and extras that would put a luxury multifamily property to shame.

"Back in the day, it was a bed, maybe a desk," remarks Brian Levy, new business development manager with J4 Developmentin Richardson, TX. "Now you're looking at amenities like dog parks, outdoor kitchens, state-of-the-art exercise equipment, tanning beds, club houses with pool tables, hot tubs and plasma TVs."  

Levy goes on to say that one student housing developer he knows of is offering another competitive amenity. "They're offering a free iPad with every bed rented," he notes. "That's quite an incentive."

The obvious question here is how student housing evolved from cinderblock sterility to county club comfort. Jill Lung, a partner with Austin-based Sixthriver Architects, believes part of the reason boils down to the competitiveness of institutions of higher learning. One of the main attractions of a university is the housing, she explains. "If housing can be enhanced with amenities, that is a plus," she remarks.

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For Levy, the amenities issue involves the fact that college students want the latest fad or trend. "They know about it and they gotta have it," he comments. "They're driving the boat on this one."

But P.J. Cusmano , director of Integra Realty Resources' Tampa office, isn't so sure that students were or continue to be 100% behind the movement. "I think it really starts with the parents," he comments. "At one time, parents wanted to their children to have it a little better than when they were in school." Beginning in the early 1990s, he goes on to say, emboldened college students started asking for extras, their parents agreed, and student housing owners and managers followed the demands.

Terrell Gates, founder and CEO of Virtus Real Estate Capital in Austin, agrees with Cusmano that the launch of student housing amenities can be traced back to the early 1990s. He also agrees that parents, to an extent, have driven the amenitized housing packages, noting that "they're spending a lot of money on tuition today; and they feel that, if they're going to spend the money, they want the kids to have it good."

Gates also believes that the off-campus housing, with its swimming pools and other amenities led the charge toward getting those things into specific, student-served complexes.  Furthermore, "when you develop purpose-built student housing and rent by bed rather than by unit, you get a higher rent per foot," he says. "This helps facilitate the larger amenities packages."

This is not to say students have no say in amenities. They're right up there, demanding that their college housing offers all the comforts of home – literally. "If they have a 50-inch HD TV at home, they want it in their dorm room," Cusmano says. "If they have wifi at home, they'll demand it in their apartment." As such, everything from DVRs, to satellite channels, to the above-mentioned free iPads are part of the college living experience in this day and age. '

As such, it goes without saying that technology is not just an amenity any more in student housing – it's a necessity. Limitless bandwidth is important to students, and not just for social media or Internet surfing. "Let's say Johnny comes home at 2 in the morning and remembers he has a paper due the next day," Gates postulates. "If the web goes down, he doesn't find the dorm manager. He complains about it on Facebook and Twitter. Then it goes viral, and it becomes a real problem."

As Gen Y graduates from college and moves out of campus dorms and off-campus housing, what will the demands of the next group of kids, the Net Generation, or Generation Z as it's dubbed? Cusmano  believes the amenities packages will continue to expand – he points out that the swimming pools in campus housing that came into being have morphed into resort-style pools, complete with private cabanas, outdoor kitchens, billiard tables in the pool and even lazy rivers. He says those amenities will continue evolving.

Gates  believes that there is a future trend toward development of more cottage-style products, complete with lifestyle areas to encourage a little more interaction.  Lung, in the meantime, points out that sustainability will be an issue – kids of Generation Xers will be on the lookout for those LEED-certified plaques on buildings, she says. "Technology will also continue to be hugely important," she adds. "We're losing books in the classroom for tablets and iPads – and owners need to make sure they keep up with that." 

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