Virtual reality (VR) is a trend that is here to stay, especially in the student housing industry. Why? The two biggest student housing consumer groups — millennials and Generation Z — are also the most tech-savvy generations, pushing companies to become more technologically advanced. Approximately 73 percent of millennials and 79 percent of Generation Z are interested in virtual reality. With virtual reality use and the amount of interest in this technology by key consumer groups on the rise, now is the perfect time for the student housing industry to employ new methods of attracting potential residents to their properties.
As universities expand to accommodate growing student populations, traditional design and construction processes make it challenging to complete projects on time, safely and within budget. Industry benchmarks show that 61 percent of typical projects are behind schedule and 49 percent are over budget, according to a report by the Lean Construction Institute. The pain of labor shortages, cost and budget overruns, and construction waste has driven many colleges and universities to look for alternative ways to more efficiently renovate or expand.
In a recurring Triad Real Estate Partners analysis series, we’re looking at university off campus student housing markets by athletic conference. Back in March we took a deep dive into the SEC, declaring the University of Florida the winner with the Georgia Bulldogs nipping at their heels. LSU brought up the rear with a market occupancy of just 78 percent and declining rents.
The adoption of recent emerging technologies coupled with a growing focus on delivering a great resident experience presents new opportunities for driving resident retention, connectivity and community engagement. And it is now more essential than ever. More and more apartment communities are investing time and effort in identifying programs to enhance community engagement such as community events, communication, feedback and incentives programs. Factoring the high turnover both by residents and onsite staff requires you to implement an engagement strategy that scales. Let’s discuss how.
Regardless of where they attend school, students across the country face the same challenges when deciding where to live during college. Students want to live near campus, pay a reasonable price, find good information about potential rentals and feel like their landlord respects them. Meet those criteria and you’re sure to find e happy renters renewing for multiple years.
Rent College Pads surveyed students across the country and received roughly 500 responses about the annual search for housing about topics that ranged from finding a new place to live to renewing at a current one. Here’s what we found out:
When looking for a rental, how many companies do you typically contact?
A quick response is essential for any landlords looking to engage with student renters in today’s competitive renting market. The rental cycle differs at every school, but typically students are looking for next year’s housing around the same time. So they know they need to act quick.
Student renters typically zero in on a few places they like and act quickly in securing them during pre-leasing periods. Students most commonly responded with 1-3 properties to this question.
When deciding where to live, what do you value most in a rental?
This was the largest majority on our survey. Every time we’ve polled students to find out what matters to them, we’ve always seen the same thing. Price matters the most. Students put their understandably bare wallets first when looking for a place to live. 60% of students responded with price to this question, with location mattering second most and amenities third most.
What’s the most common problem you face with rentals?
Occasional Wi-Fi problems are something we all struggle with from time to time, but there may be no group more reliant on speedy, reliable internet access than college students. Whether they’re working on homework or their social life, students want to be connected 24/7.
Most landlords renting out houses or small apartments are handcuffed a bit when it comes to supplying internet, but mega complexes that include Wi-Fi in the cost better make sure that their internet provider holds up their end of the bargain.
What does your current landlord do that bothers you most?
Late maintenance was the biggest pet peeve student renters had. When a window won’t close or the front door gets stuck open, tenants get unhappy. Without a clear expectation of when something will be fixed and sticking to that promise, it’s likely a student-landlord relationship will suffer.
Even if no one is going to get up to a unit for a couple of days to help fix a problem, communication can at least set expectations and make a renter feel like you care about their problem. Over communicating on maintenance is better than under communicating.
How long does it typically take for maintenance to be completed at your house or apartment?
We saw the widest range of student responses on this survey question. While some said they often had their needs met in less than 24 hours, others said they were frequently left waiting a week each time something went wrong. 48 hours was the most common response though, with 30% of students responding.
Given that the majority of students said the most annoying thing their landlord could do was dawdle on maintenance, this is a huge opportunity for securing a strong relationship with a student tenant and ensuring they renew their lease.
How long do you typically stay in one house or apartment unit?
The average student will move two or three times after they get out of the dorms. 63% of students said they stay in the same house or apartment for just a year. Why are they on the move so much? Sometimes it’s because of roommate changes, but other times landlord relationships plays a role too. Landlords who are willing to go the extra mile to keep renters happy do see them stick with the same company, even if they are looking to move to a new house or apartment.
What contributes the most to you renewing your lease at your current location?
A whopping 78% said relationship with landlord. If a student has roommates they like, the biggest factor that plays into them staying or going is how they feel like they’ve been treated in the past year. Improve your renewal rate by maintaining positive relationship with your renters.
The insights we found weren’t necessarily revolutionary – students have largely wanted to pay as little as possible while getting the best treatment as long as they’ve been renting. But it’s always good to hear that whether students are living in a luxury location near the University of Florida or toughing out the winter in a house blocks from the University of Minnesota, they’re facing the same challenges and looking for the same thing.
— Dominic Anzalone is the founder and CEO of Rent College Pads, a nationwide resource that helps students find housing near campus.
Successful marketing strategies for any housing management organization focus on both the direct and indirect amenities offered by a specific property, especially when targeting millennials. The exceptional student experience that housing management organizations strive to achieve also creates a bridge between the facility, the campus, and the surrounding area that must be safe, reliable, and convenient. Developing and managing a structured transportation service plan that focuses on how to maximize service, minimize cost, and control external concerns like liability management can help make this value-added service much less of a burden on property managers.
Purpose-built student housing remains an attractive investment following a record year in 2017. Since student housing is still catching up to demand, and boasting cap rates on par with traditional multifamily, there are plenty of development, acquisition and value-add opportunities within the sector.
With March Madness lingering in the air, we at Triad Real Estate Partners wanted to take a look at some student housing analytical data based on athletic conferences. While the Southeastern Conference is generally known for its members’ prowess on gridiron, the SEC placed an impressive eight teams in the NCAA basketball tournament this year — a strong showing for any conference and the most in SEC’s long and storied history. In light of this accomplishment, we decided to make the SEC the first of a recurring look into ranking the student housing markets at each conference’s schools.
Take a moment and listen. Really listen. Do you hear that? Chances are that when you paused, you heard a sound. Whether it was annoyingly loud or barely audible, there was a noise, and you heard it. Even when sitting alone in a quiet spot, there is still noise — the hum of an appliance, music in the background, a bird chirping outside the window, traffic in the street, or the low rumble of an airplane overhead.
Institutions of higher education are constantly studying their plans and cramming for the next school year. The influx of different types of housing options for students — including classic dormitories, apartment-style residences and even university-owned, off-campus options — has made housing choices a key point of differentiation for colleges and universities. This, in turn, has created the need for institutions of higher learning across the country to have strong partners in the construction sector.
College campuses across the country are in a constant state of flux. Classrooms and academic spaces are changing, costs are rising and myriad factors are forcing universities to redefine the student experience. Student housing finds itself in the middle of this ever-evolving atmosphere.
As the demand for state-of-the art student amenities escalates and an increasing number of colleges are using housing as a marketing tool to attract the best and brightest students, new dormitories top the wish lists of universities around the nation. Residence hall design is also being jolted by technology. While mobile computing, ever-present internet connectivity and distance learning all affect how, when, and where students learn, advances in technology can ease on-campus construction woes, too.
While opportunity exists, on-campus construction presents unique challenges not shared by other construction projects — with little room for error. On-campus projects need to attract top student talent while remaining on schedule, on budget and minimizing disruption to its surrounding areas.
Increasingly, lavish amenities are becoming signatures of student housing as students are beginning to demand more value from where they live. Ubiquitous internet connectivity is just one of the residential amenities that colleges are using as selling points to lure students.
For example, Uncommon Fort Collins, a recently completed student housing project for Colorado State University, features a fitness room complete with weights, cardio equipment, a ski simulator and a rock climbing wall, two outdoor courtyards, a lounge and a business center. While these amenities may appear excessive to their bill-paying parents, university officials say they’re fiercely competing for top student talent, so they strive to give them what they want.
Many universities view housing as an extension of their brand, consequently, on-campus housing is being designed to offer amenities rivaling market-rate apartments that compete for student renters. As a result, builders are considering how to incorporate luxurious amenities earlier in the design process. Advances in 3D building information modeling (BIM) have allowed the structure and engineering details that will eventually be built on site — including state-of-the-art amenities and academic and social spaces — to be captured in a fully detailed, 3D virtual model during the earliest stages of the design process. This advance enables architects to use software to model the structure as part of their typical project design workflow, in addition to driving efficient and expedited layout, design and system coordination.
School Construction Zones
Due to the nature of on-campus projects, the ability to keep surrounding areas “out of the construction zone” is crucial. Loud machinery and chatty construction crews create distracting noises that aren’t conducive to a positive learning environment, and at the end of the day, students pay to come to campus and learn.
Another technological advance working to generally improve student housing construction while minimizing disruption to the areas surrounding an on-campus project is the use of robotics. With lean manufacturing robotic systems, assembly proceeds according to engineered shop renderings created by advanced BIM software, building a digital plan that guides the assembler and highlights parts by order of assembly.
Automated robotic welding systems work directly from the architect’s model, allowing systems to fabricate building components before they arrive on site, which makes on-site installation easier than ever before. Building a brand new student residence on campus rather than simply assembling one is far less appealing to facilities directors when it comes to disruption. Building from scratch, on site is significantly more disruptive than buildings that only need to be bolted together.
The Bottom Line
A crucial factor in determining which company will or won’t receive a school construction bid is the bottom line. The majority of universities depend on state and federal funds, in addition to tuition payments, which means construction budgets are often rigid, with little to no wiggle room.
Many construction companies struggle to keep student housing projects under budget, but advancements that utilize robotics or automation are not only making job sites safer and projects faster to build, but these systems typically make the completion of a student housing project less expensive, too. When it comes to student housing projects, budgetary issues resulting from waste, rework, unreliable crews and poor quality are untenable.
However, advances in construction technology have opened the door for projects to be completed on budget. The level of precision unlocked by manufacturing robotics systems drastically reduces on-site waste and eliminates the need for costly and time-consuming rework in the field as building components do not need be cut and built on site — they are simply installed using QR codes to help on-site crews complete projects in less time, with fewer people.
When it comes to student housing, universities have very strict deadlines, because when classes start, students need somewhere to stay. Construction methodology that enables technologies like BIM is ideal for these time-sensitive, multiunit projects because of its 3D scalable design aspect. When builders know the precise measurements and outcome of a project, the need for rework is greatly reduced.
Time-consuming, repetitive work that requires heavy lifting and precision is the ideal task for automated robotics systems. By receiving precise specifications and dimensions for every component, manufacturing robots progressively shape high-quality building components that yield an unmatched level of precision. Manufacturing robots are able to punch, dimple and cut building materials to precise measurements for assembly into entire building components like wall panels and trusses. Working with steel framing unlocks a level of precision that allows for improved structural stability, meaning mechanical, electrical and plumbing (MEP) tradespeople can begin work much earlier than with concrete structures.
Automated robotics systems allow for the creation of a seamless process — from design through installation. From eliminating costly rework to phasing in MEP tradespeople to begin working sooner, advances in construction technology are beginning to ensure student housing projects stay on time and on budget.
In the end, robotics systems and automation are becoming increasingly viable solutions for the school construction industry, allowing student housing projects to be built faster and for less money while improving on-campus safety by minimizing disruption. Even slight differences in operating expenses can unlock significant savings, and companies must be prepared to meet the demands of intelligent institutions with digital techniques and advanced technologies or they risk not having the tools get the job done.
— Magued Eldaief, CEO, Prescient
Attracting millennial students to your property requires offering great amenities, especially those related to comfort and connectivity. Suntan booths, pools, media rooms, spas, flexible lease options, upscale furniture, Wi-Fi and cable are among the amenities used to draw college students into off-campus housing. The days of sterile, concrete, multi-roommate housing are fading as investors increasingly position student housing as a lucrative investment opportunity.
There are so many families that are unable to visit student-housing properties in which their children long to live. Virtual Reality (VR) video helps bridge the gap from potential resident in one state to actually owning a property in another while also utilizing the perfect technology to appeal to Generation Z.
Restoration Hardware’s CEO, Gary Friedman, made a startling revelation that should be a warning sign to all property owners and managers bidding for key words on google. He describes a recent meeting with his online marketing team with regards to increasing ad word spending: “We’ve found out that 98 percent of our business was coming from 22 words. So, wait, we’re buying 3,200 words and 98 percent of the business is coming from 22 words. What are the 22 words? And they said, well, it’s the word Restoration Hardware and the 21 ways to spell it wrong, okay?“
The student housing industry faces a unique challenge among residential businesses: end-of-year turnover. Millions of young people across the United States move out of student housing at the same time, and within a few days, a whole new group of residents moves in. This mass exodus and influx can be a challenge for property professionals as the frantic pace of turnover between academic years makes it difficult to track students down to discuss charges for repairs and maintenance as everyone scatters to the four winds the moment the term is up. Managing risk becomes a major hurdle, as well, with so many people moving in and out at once, and accidents caused or exacerbated by hazards on the property can be very costly for owners.