Resident Experience Equals Success for CLV

by Katie Sloan

Resident Experience Equals Success for CLV
Campus Living Villages’ U.S. CEO Kevin Bradt brings a hospitality background to his work in student housing.

Kevin BradtStudent Housing Business recently interviewed Kevin Bradt, CEO of Campus Living Villages U.S. Campus Living Villages owns and manages approximately 37,000 beds of student housing around the world, with over 20,000 of those beds located in the United States. Based in Australia, the company’s U.S. arm has 30 properties under management, with 22 of those located on college campuses. Bradt, who is based in the company’s U.S. headquarters in Houston, joined Campus Living Villages (CLV) in 2013.

SHB: You didn’t ‘grow up’ in the student housing industry as a number of CEOs did, but you have experience in it. Tell us about your background and what led you to Campus Living Villages?
Bradt: I came from the hotel industry, where I was for about 15 years. I was the division president at Choice Hotels International. I ran 50 percent of the company’s global hotel portfolio. I had five hotel chains that I operated. Nearly all of the 3,000 hotels I ran were franchised. With a system of that size, you have properties that are entering and leaving the system at any given time. I would do exit interviews with some owners and I saw a trend happening: they were converting their hotel properties to student housing. I started doing some research and found that there were two customers who were buying our hotels: universities who were converting them to on-campus student housing, and private developers who were turning them into off-campus student housing. I realized this must be affecting our competitors as much as it was affecting us. I found brands like Hilton, Ramada and Holiday Inn were also being affected by this trend because of the supply shortage in student housing. I started to work with the U.S. Department of Education to realize what was driving this. As a side note, we determined it was the echo boomers going to colleges that had an antiquated and inadequate supply of student housing.

SHB: You eventually left Choice to strike it out on your own with this in hand, yes?
Bradt: I launched a company called Campus Brands. What I wanted to do was create an innovative new brand for student housing. When you look at the waves of investment, if you look at the product side, it is investment focused. When you hit the ceiling there, you become operationally focused. That is where you can really create some differentiation. The student housing industry could be a mirror to the hotel industry in its evolution. A lot of developers want to know how they can differentiate their properties from others in the market; that’s why the amenity wars are going on right now, as they did in the early 2000s for the hotel industry. My concept was to help developers compete from an aggregate perspective by leveraging economies of scale. While I had significant developer interest, the timing clashed with the global financial crisis. The company had some capital market challenges, being a real estate-focused company trying to start in a recession. But the strategy was sound and this was when I was approached by CLV; that is really where this marriage started to take place.

SHB: The global financial crisis shook up a lot of companies. How did it impact CLV and what changes is the company making going forward as a result?
Bradt: CLV wasn’t alone in weathering that, of course. We are an international company, so that did affect us as much as any other company. A number of real estate companies had projects and properties go into receivership. CLV remained strong. The company had needs to be addressed coming out of the financial crisis. That is one of the reasons I was brought in. Our thought now is, ‘what is the next chapter for CLV?’ We are looking to invest in our assets and invest in our infrastructure. It is an exciting time for us, and for me. I get to take the experience I have from running a very large portfolio and apply it here.

SHB: What attracted you to the CLV portfolio?
Bradt: CLV really has a niche within a niche. CLV really focuses on the on-campus experience. The company’s core competitive advantages are location and strong university relationships. We have the best locations in the markets that we’re in. Being on-campus and right at ground zero gives us an incredible opportunity to deliver a great student experience. Secondly, we have a reputation of being a great partner to universities. A lot of the off-campus players shy away from those relationships. You have to put a lot of work into the on-campus relationships, and there is a lot of intellectual knowledge that needs to go into building those relationships. That’s a barrier of entry.

SHB: Where does CLV see the opportunity overall in the student housing market — is on-campus still the biggest point of growth?
Bradt: We look at it in multiple tracks. We see the trend of state funding shrinking;CLV operates The Edge, near
Temple University in Philadelphia.
the public-private partnership opportunities are continuing to grow. We want to continue to deploy capital on that side of our business. Of course, if there are off-campus opportunities that really make sense for us, we are potentially interested. They have to be closely aligned with the universities for us to be comfortable. Off-campus, we believe a lot of the value that we can bring is through our management arm. For other owners, we can leverage our core competencies and our scale to give them a competitive advantage in their markets. Some owners may not know how to work with the university directly.

SHB: Would you say CLV has ambitious growth plans?
Bradt: Yes, we are out globally raising capital. That has been good for our next phase of developments. We have a lot of growth in the other global markets where we are active — the United Kingdom and Australia. We are really the only true international player in the U.S. market. Our development goes in waves in different international markets — we might see some in the U.S. one year, then in the U.K. the next year. From a development and acquisition perspective, we are looking continually in the U.S. at on-campus projects. We are putting a lot of resources into our off-campus management arm.

SHB: How do you use CLV’s international experience to your advantage in the United States?
Bradt: We can create unique experiences for students as an international owner and operator. If we create a great student experience, everything else will fall in line. Being international gives us an advantage for our student-residents and for our university partners. We’ve had partner universities in different geographical locations that want to have a sister university in the U.S. We help to bridge the communications between two different universities so they can create co-managed programs. We, of course, can provide the housing for those students. Our students can also travel to different markets and experience internships or study abroad programs that we can foster.

SHB: How are you applying your experience in the hotel industry at CLV?
Bradt: My background in hotels was development, marketing and operations. At CLV, I’ve been pushing operational consistency so that we are delivering a consistent experience every day for our students. I want them to have a lifestyle experience, not just a sticks-and-bricks experience. We have to understand our student holistically through their entire student experience, so that we can add value throughout their living experience with us. A lot of that is at the property level, but some of it is not. We have to make sure they are connected to the university and to other students. That is a big focus for us.

University Meadows is located
near the University of Missouri-St. Louis.
SHB:
Business is different in Australia, from finance to working life. Is there an adjustment in working for an Australian firm?
Bradt: The U.S. and the Australian markets are different. From the way we structure financial activities to our cultures, there are differences. They wanted to make sure that when they picked someone to run the U.S. organization it was someone who really understood CLV’s business in the U.S. CLV understands that these are different markets and they need to be treated differently. That’s a huge step forward when you are a multi-national company. CLV is on the cutting edge of that in student housing, so there is learning that is going on across the company. From an operational perspective, student housing as a whole is in its relative infancy. To have a multi-national company in the field at this stage is quite a feat — there is plenty of learning to be done. But that is what is exciting for me; to be at the ground level from the operational perspective and help guide the industry forward.

SHB: Speaking of operations, how have you analyzed CLV’s operations and what changes are you making?
Bradt: I’ve been here long enough to do an assessment and I’ve broken them up in to two components. The questions I focused on were: how do we perform as an operating company and how do we perform and function at the property level? In the operating company, we have tried to focus our resources and our teams around the key drivers to success for our organization. I created what we call the University Affairs Division. Part of our value proposition is that we create strong university relationships. That is a critical area of importance for us. With our operational infrastructure, we are looking at our technology and our systems to become more intelligent about our business. We just made a major investment in a new property management system, StarRez. It will give us a lot more intelligence as we move our business forward and allow us to bolster our analytic capabilities. At the property level, we are driving operational consistencies. We are creating a new operations manual in place and having more clearly defined standard operating procedures in our U.S. portfolio. Students have to have a consistent experience across the entire portfolio to improve the performance of the portfolio.

SHB: How often are you in the properties? What do you look for when you are on-site?
Bradt: I spent six years in the field when I was in the hotel industry. I was walking hotels and talking to our guests. I want to be in the market with our residents. I’ve seen our dynamic student base. I’ve seen the hard work that our staff is doing. Our staff is craving to learn and they want to have more tools. As an operating company, I believe in servant leadership. As I serve our properties, our properties serve our students and our university partners. It has been great to see that approach accepted at all levels of the organization.

SHB: What improvements are you making in the company or the portfolio?
Bradt: We want to make a major physical plant investment over the course of the next 24 months. That will involve most of our properties in the U.S. When you look at our portfolio, we have different ages of properties. We are looking to enhance the experience by upgrading our properties. We are developing the 24-month plan for all of our on-campus assets. Each property has its own needs; some need improvements in the Internet bandwidth infrastructure, while others need interior improvements. We are surveying our students to see not only what they want in student housing, but what they need. We are integrating our university partners in that research. They are part of the task force in each of our markets to help us. It is a very collaborative approach.

SHB: Do you have any goals for the company over the next 12 to 24 months, capital improvements aside?
Bradt: Yes, I’d like to significantly grow our third-party management arm. While we are a growing third-party manager, we are one of the biggest managers in the world in terms of our own assets. We can take the scale that we have and really help other owners. I also want to look at smart P3 deals as well. We have the capital to do those direct investments in our own properties, as well as look at development opportunities.

SHB: In third-party, CLV recently landed the Dobie Center at the University of Texas. Tell us about that property.
Bradt: That is a very complex management agreement. We are very excited about this project. The choice of CLV to manage the Dobie Center demonstrates the fact that we have run food and beverage and all of the ancillary service that Dobie needs. We have a closer knit understanding of what that kind of asset needs than some of our competition. It is also a signal to us that we can win other types of these deals. At 27 stories, Dobie Center has over 900 beds and is the largest private university housing property in Austin. It is a flagship asset in a flagship student housing market.

SHB: What makes you excited to come to work every day? Why do you like your job?
Bradt: I’m passionate about working with great people and delivering a great student experience. Those are the two things that get me up and get me excited every day. I like to foster great teams who deliver great experiences to our students.

SHB: How often are you on the road?
Bradt: Between our properties and our global operations, quite a bit. I’m at our properties between 30 percent and 40 percent of the time. The travel comes in waves: I like to see move-in when you can really talk to the students. We have meetings of our global operations team quarterly. We have our global team coming to Texas soon — it’s our turn to host next. Each quarter we rotate; next quarter it’s Sydney, then New Zealand, then London.

SHB: When you are not working, what do you do to unwind and relax?
Bradt: I have a close family and try to be very active in the community. I also was a competitive tennis player in college, so I try and play a lot of tennis still. To round it out, I’m also working on a book.”

— Randall Shearin

You may also like