Four days. Two thousand-plus anxious students and all their frantic parents. 110 degrees. Twenty-five Place Properties' employees and 60 university staffers. Welcome to move-in week for students at Kennesaw State University, outside of Atlanta.
The yearly event–happening this month at colleges and universities across the country–has all the makings of a reality TV show with its potential for the perfect combination of drama and disaster. In fact, some people would take one look at the frenzied scene and quickly run in the other direction. But not Cecil Phillips, who helped his three grown daughters survive their move-in days and now relives the experience each year as chairman and CEO of Place Properties.
Credit: Todd Bennett
"One of the beauties of this job is that it keeps me forever young," says Phillips. "I still joke that I am 24; it's kind of tongue-in-cheek, because I am only 25," the 59-year-old adds with a grin.
Place, with more than a decade of experience as a student housing developer and manager, has move-in day down to a science. In April, the company starts gearing its management team for the big event with a two-and-a-half day training session complete with a practice run-through. Such detailed preparations are critical to Place's success. After all, the company's entire resident base moves in during a one- to four-day period in August.
During the training session, the company covers nearly every scenario that could possibly happen, both positive and negative. "It's all about that first impression," says Joyce Copeland, Place's vice president, property management. "If they have a terrible move-in day, when renewal time comes they are going to remember that terrible move-in day and go someplace else."
But Place does its best to keep such situations at bay. On move-in day at Kennesaw State–and at properties throughout Place's portfolio–Place employees and the university staff gather as early as 7 a.m. to set up move-in stations, stuff welcome bags, and fill coolers with cold drinks. Employees then help with the carefully orchestrated student check-in process, while others are strategically positioned throughout the property to help direct students to their apartments, man the elevators, and hold doors open as residents lug in their goods. "It's organized chaos or chaotic organization, depending on how you look at it," says Phillips.
The company makes a strong effort to put students' needs first not just on move-in day but throughout their entire stay. From the design of the units to day-to-day management practices, Phillips and his team work tirelessly to ensure that students have a first-rate college living experience. "Cecil is an innovative guy who looks for new and better ways of doing things," says Ken Becker, director of New York-based Citigroup Global Investment Bank, which provides Place with financing. "Place typically does market studies with focus groups and surveys that involve the students on issues all the way down to what kind of furniture they prefer in their units and what kind of gathering places they like."
Finding Its Place
The soft-spoken executive's face lights up as he talks about his start in the student housing business. The enthusiasm is undeniable: "Hanging around 18 and 19 year-olds is a lot of fun," he says animatedly. "It gets me back to college, which was the happiest time of my life by and large."
Phillips' knowledge of the industry dates back to the early '80s, when he ran a merchant banking business called Phillips International. He represented foreign clients who invested in projects from student housing to savings and loans and golf courses. Phillips, however, was most intrigued by the student housing sector. "The more I looked at student housing, the more its demographics and opportunities appealed to me," he says. So, in 1995, the entrepreneur went from financing to developing the niche when he founded Place Properties.
The company got its start by developing off-campus communities. The business plan made sense: Nationwide, between 75 percent and 80 percent of all student housing is located off-campus, Phillips explains. But the company quickly saw a real demand to bring new housing on campus with public dollars for schools quickly shrinking and enrollments skyrocketing. In fact, Georgia's governor had asked Phillips in the early '90s–while Phillips was at Phillips International–if there was a way to privately finance on-campus housing. (Phillips has strong government ties, having served as executive assistant to a former Georgia governor after working as a private practice attorney for 10 years.) Always up for a challenge, Phillips used his government and financial know-how to pioneer privatized, tax-exempt, nonrecourse financing for on-campus housing. The first privatized project was approved in 1995 and now serves as a model for student housing developers everywhere, says Phillips.
"Until this model was developed, the only way you could get money for a new dorm was to go stand in line, apply for it with a board of regents, and work with government budgets," says Phillips. "It would take three years to get design money, and then it would take another five years to get funding. Eight years later, construction costs had gone up so much you couldn't afford what you designed." The privatized process is streamlined, minimizes politics, and avoids big construction cost increases, he explains. "The shortest time frame from award of an RFP to commencement of construction has been 90 days, with 700 beds of student housing delivered 11 months later."
Early in his housing career, Phillips also helped establish the single-bedroom lease with parental guarantee, which was a big change from the traditional apartment lease of renting by the unit. This tactic helped convince lenders that student housing was a sound investment option, says Mike Flanagan, senior vice president of Birmingham, Ala.-based Regions Bank, which provides Place with construction financing. "In the early '90s, student housing was a real stepchild to the multifamily industry," he says. "Baby boomers who then became lenders would say, 'Student housing, no way. I was a student; I know what I did to that asset.'" Phillips helped change this mindset, he adds.
The executive's early groundwork paved the way for a strong future. Last year alone, the company completed property acquisitions, dispositions, and refinancings totaling more than $500 million. Plus, the company manages more than $725 million in on- and off-campus student housing assets (including third-party contracts) that represent more than 18,000 beds in 12 states.
No Home Like Place
Despite such rapid growth, Place never skimps on the details that make its communities a home. Walk into one of the company's properties–be it on or off-campus–and your jaw is guaranteed to drop. Forget the typical dorm with no air conditioning, an old radiator heater, a tiny portable refrigerator, ancient laundry facilities in the basement, and a hall bathroom shared by a dozen or more students.
Students have their own bedrooms and bathrooms at Kennesaw State University's University Village.
Credit: Place Properties
Place's typical on- and off-campus community caters to every need of the student. Communities offer fully furnished four-bedroom, four-bathroom units, plus full kitchens featuring a bar seating area, a living room, and of course, the must-have washer and dryer. Most properties boast a so-called "Town Hall," which serves as a focal point for student life. In addition to computer labs and study areas, the Town Hall features activity and game rooms with pool tables and foosball, big-screen TVs, and fireplaces–not to mention nearby fitness centers and pools.
These types of amenities are a necessity in today's world, says John R. Anderson, vice chair of the University of Chattanooga Foundation and the Campus Development Foundation, which owns a property built and managed by Place at the University of Tennessee at Chattanooga. "Cecil is very much in tune with the student culture today," says Anderson. "Students today are more sophisticated [than in the past], have higher expectations, expect more privacy, and want access to more services."
Interestingly, some schools are making a special effort to equip freshman communities with the latest and greatest amenities: Their freshmen live in newly built communities, while upperclassmen are housed in older buildings–quite a change from the past, when freshmen were assigned to the no-frills dorms. "If we can dream it and build it, parents are ready to give it to their children," says Jessica Nix, Place's director of public relations.
To discover what students really want, the company frequently holds student focus groups, and Phillips consults his three young adult daughters for much-welcomed advice. Don't be surprised to see the executive himself wandering the walkways of a campus near you, chatting with students about their living experiences. "This particular demographic group is not shy about telling you what they like and what they don't like," says Phillips. "There's no doorkeeper, and it helps me because I get their advice unfiltered and undiluted."
Unlike some executives, Phillips takes the students' advice to heart. It's this commitment that drew Jim Rosenberg to the company a few months ago to take on the role of president and COO. "He has a passion for this industry and wants to make a difference for both students and universities," say Rosenberg, who left Archstone-Smith for his first foray into student housing.
Residents are treated to the latest and greatest amenities at the Christa McAuliffe Residential Community at Bowie State University in Maryland.
Credit: Place Properties
Phillips' dedication shows even in his furniture selection for the units. At first glance, you probably wouldn't notice anything unusual about the chairs and couches. But Phillips explains that each item was carefully chosen for a reason. Take the desk chair, for example. It's a two-position chair that lets students either sit upright or safely rock back and put their feet up on their desks as they work. The living room sofa and end chairs feature extra-padded arms so residents can comfortably swing their legs over the furniture (as Phillips demonstrates in his office chair) and watch TV without destroying the arms. And instead of providing a table and chairs in the kitchen, Place added the popular bar with matching bar stools. Such selections not only win the approval of students but also help extend the longevity of the furniture.
"Someone once said to me, 'You are spoiling these kids,'" says Phillips. "I said, 'No, they come to me that way.'"
Another innovative management technique: Place inspects each unit monthly to check for damage, be it a cigarette burn or a hole in the wall. So don't expect any Animal House action at a Place property. Any damage is fixed within 24 hours, and the lease guarantor (most likely a parent) is charged on the next month's rental invoice. "The monthly inspections floored me, for someone to think to do that," says Copeland, who joined the company from the market-rate side of the multifamily business. "It helps us so much when it comes to that turn time so we are not having to go in and replace 50 doors at once."
A High-Tech Place
Place's student-focused approach to living extends to its technology offerings. The company offers a completely paperless leasing process. "There is no stamp and no piece of paper that is required for any prospect or customer of Place Properties," Phillips says proudly. The company went paperless about three years ago and estimates saving hundreds of thousands of dollars each year in both man-hours and paperwork. Just one example of the savings: The company was able to lease a 740-bed high-rise in Knoxville, Tenn., with only one and a half leasing agents–a feat that would have required at least five employees without a computerized system.
Any time, day or night, prospects can complete and submit applications and room reservations and make payments. Students are taking advantage: Last year, nearly 40 percent of Place's residents rented their bedrooms between midnight and 2 a.m.
The Web-based system is just as helpful on the back end. The property management team can electronically manage the customer application and leasing process, with the ability to follow up on leads for uncompleted applications. "They can play offense rather than sitting in the office processing forms," says Tom Ratchford, president of WebRoomz, the company that sells the Web-based product. (The product was originally created in-house)
ABAC Place replaced outdated housing and brought new life to Abraham Baldwin Agricultural College in Tifton, Ga.
Credit: Courtesy Place Properties
The most unusual aspect of the system: It offers an online roommate matching system where residents can post profiles, chat with potential candidates, and ultimately select their roommates and exact units. The system, pioneered by Phillips, simplifies a typically complex, paper-intensive process and reduces roommate matching errors. Just as important, residents love the power of selecting their own roommates–and encourage their friends to rent from Place.
So what type of high-tech gizmo will Phillips and his team think of next as the company continues to grow and develop properties at more colleges and universities? Only time will tell as members of the booming Y generation demand more and more amenities to fit their high-tech and highly social lifestyles. Who knows–maybe one day the labor-intensive annual move-in event will be facilitated through an iPod Web cast. But what fun would that be?
Place Properties
Place Properties' communities feature "Town Hall" gathering spots with pool tables, big-screen TVs, and more.
Credit: Todd Bennett
- Founded: 1995
- Headquarters: Atlanta
- Employees: 405
- Beds owned in 2005: 2,319
- Beds managed in 2005: 19,463
- Beds projected to build for 2007-08 school year: 2,900 +
- Geographic coverage: national
- Biggest growth area: third-party management (the company recently sold 13 properties to Education Realty Trust and now manages the properties for the REIT)
Leadership Lessons: Cecil Phillips
Phillips says his greatest strength as an executive is his ability to identify the right people to run his company.
Credit: Todd Bennett
- Age: 59
- First Job: Mowing lawns at age 10
- Ideal leader: Someone with the character of Harry Truman, the steadfastness of Abraham Lincoln, the eloquence of Churchill, and the humility of Mother Teresa.
- Favorite quote: "What would you do if you knew you would not fail?"
- Best business decision: To grow the company from an entrepreneurship.
- Greatest challenge: Managing the company without losing the culture of risk taking.
- Favorite office decoration: A giant-sized globe, which his wife gave him after he traveled the world. He frequently scrolls to Australia to check on his daughter who lives there.
Beyond Bricks
Place transforms college campuses.
Place Properties doesn't just provide students with a place to live; the student housing firm has also breathed new life into campuses. Take Kennesaw State University, a small school in Kennesaw, Ga. With no on-campus housing, it was primarily a commuter school until Place Properties entered the scene. In 2002, Place established a partnership with the school and its foundation to build two communities (nearly 1,580 beds), including a building just for freshman. Now students can get the full college experience.
Similarly, Place's fresh on-campus housing has helped revive the student life at the University of Tennessee at Chattanooga. "Place has transformed the school into a campus that has energy and vibrancy all the time," says John R. Anderson, vice chair of the University of Chattanooga Foundation and the Campus Development Foundation. In fact, the school's social scene has shifted to the south side of campus, where the new student housing properties are located.
Place also helped dramatically change the landscape at Abraham Baldwin Agricultural College in Tifton, Ga. ABAC Place, an 835-bed property built in 2004, replaced outdated 30- and 40-year-old housing structures. The property–which has a wait list of 200 students–has helped increase student enrollment and ultimately enabled the two-year college to offer select four-year programs, says Melvin Merrill, director of development for the college and president and CEO of the ABAC Foundation. "Place has been responsible for truly raising the bar for everything we have done here," he says.