Today’s student housing properties are far removed from theones immortalized in the classic movie Animal House—no drunken frat boys passed out on the lawn, no toilet paper hanging from the trees, and no bed sheets streaming from the windows. But that doesn’t mean student living quarters are just like conventional apartment communities. In fact, apartment professionals are often surprised by the differences—differences that make owning and operating student housing, some would say, much more challenging, and more rewarding.
“I always tell people that a student housing property is really an extended-stay hotel that’s run like a cruise ship,” says Ted Rollins, co-chairman and CEO of Charlotte, N.C.–based Campus Crest Communities, a REIT that owns and manages approximately 6,324 student housing units and 17,064 beds. “We have a big focus on student lifestyle and experience, and we run a very hospitality-oriented operation. In fact, we don’t hire [team members] from the apartment industry—we hire out of the lodging sector.”
Operationally Intense
One of the biggest differences between conventional apartments and student housing is the level of operational intensity demanded by the academic calendar and the resident base. As a result, student housing properties generally require a larger, specialized staff.
“In student housing, customer interactions are heightened,” says Matt Fulton, vice president of operations of Memphis, Tenn.–based EdR, a REIT that owns or manages 36,600 beds. “Conventional apartments usually have one contact per unit, but because we lease by the bed, we often have three or four. We could be dealing with 700 people for a 300-unit property.”
Fulton says students (and parents) expect a contact to be on site and available 24/7. Student housing operators usually hire students who live on campus and can address after-hours issues.
The presence of on-site employees who do double duty as students also reduces behavioral issues, says Dan Oltersdorf, vice president of resident life for Campus Advantage. The Austin, Texas–based property management firm employs 350 student-staff members.
“We try to emphasize the importance of their role—they’re involved in leasing, marketing, event planning, and emergency management,” Oltersdorf notes. “Since they’re peers to our residents, they create a more cohesive community. Their presence is a significant deterrent to [students] getting out of control.”
In addition to the challenges created by housing hundreds of young adults, operators have to contend with a single move-in period, usually mid-August. Thus, leasing efforts are focused on getting properties filled prior to summer break. “If you miss that lease-up window, you’re sunk,” Oltersdorf warns.
Unlike conventional communities, where move-ins occur throughout the year, student housing properties have to align with the new school term. EdR, for example, has its marketing plans ready to go almost immediately after move-in is completed so that it can start filling up units for the following school year.
That single move-in date affects not only leasing, but also the make-ready process and resident check-in. The effort involved in getting units ready for move-in is gargantuan. In Gainesville, Fla., where Campus Advantage manages communities near the University of Florida, the firm turns 1,488 beds in fewer than two weeks. In contrast, EdR’s Fulton points out, conventional multifamily operators usually can handle make-ready and turns in-house because move-ins are spread out.
Answering to Mom and Dad
Today’s parents are more involved in their children’s lives than ever before. That creates an entirely unique set of opportunities and challenges for student housing owners and operators.
“The expectations of parents are very high,” says Mike Hartnett, co-chairman and chief investment officer of Campus Crest. “When it comes down to it, we’re in the business of taking care of people’s kids.”
Smart student housing owners and operators go out of their way to interact with parents. More important, they never forget that parents are entrusting their children to their care, says David Adelman, president and CEO of Philadelphia-based Campus Apartments, developers, owners, and managers of student housing, with more than 32,000 beds in 24 states. “That’s why our business is even more focused on safety and security,” Adelman says.
“I think the old attitude was that you had to deal with parents,” adds Oltersdorf. “The new attitude is to channel the energy instead of blocking it … to find new ways to communicate with parents and capture their attention, because they’re now shadow residents in our properties.”
Jennifer Popovec is a freelance writer based in Fort Worth, Texas.
