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The Three “P”s Solve Student Housing Development Challenges

Public-Private-Public Partnerships eliminate construction costs and headaches for schools building new student housing.

 

Filipek (left) and Fore Principals
Sora Holdings

There are myriad challenges curtailing construction of new student housing projects by colleges and universities coast to coast. Several of the most formidable deterrents include today’s anemic economy reducing available financing; decreasing government funding; lack of space on campus; and bureaucratic red tape.

At Sora Holdings, we have named the solution to this quandary: The “three P’s” – public-private-public partnership.

An improvement over the more common public-private partnership, a public-private-public partnership brings into unison a municipality, a developer and a university to undertake a mutually beneficial project, in this case, utilizing a new student housing campus to anchor a new mixed-use retail corridor to revitalize a community’s business district.

It’s win-win-win. The university obtains its needed new student housing, the municipality stabilizes and enlarges its tax base with new ratables and the developer creates a successful commercial project.

Possibly most important, the university has very few — possibly even zero — capital expenditures to build its new student housing by entering into a long term lease with the developer, who leverages the lease to help finance the construction and retains ownership of the buildings, establishing new taxable property for the municipality. While the design of the new student housing is tailored to meet the school’s needs and preferences, because the project is constructed by a developer, it likely will cost less to build and be completed more quickly than if done independently by the school, making it not only cost-effective, but also a potential revenue generator for the school.

Equally important, because the developer is building the project and handling all the typical problems and bureaucratic red tape that belabor such undertakings, the school is relieved of those difficulties and a new reciprocity is established, seamlessly bridging that independence and autonomy frequently found separating schools from their host communities. The public-private-public partnership unifies resources and establishes a synergy between the school and the municipality mutually benefiting the three partners and the community as a whole.

But that’s just the beginning of the benefits. Such a project reenergizes a community’s downtown business district and creates an extension of the university’s campus. It’s not just a few new dormitories or student housing apartment buildings, and it’s not simply new retail and restaurant space. Planned and executed properly, the project creates a full ecosystem — a new walking community, with a ‘sense of place’ of its own, which provides beneficial real-life experiences for the students and creates a shopping and entertainment destination for the municipality.

 

Street view of the Rowan Boulevard project, a $300 million mixed-use development anchored by student housing for Rowan University in Glassboro, N.J.

Sora’s $300 million Rowan Boulevard project being constructed in partnership with Rowan University and the Borough of Glassboro, New Jersey, is an exemplary model. Currently the largest municipal revitalization project in New Jersey, the key to Rowan Boulevard’s success is strategic development based upon facts that reflect the best, sustainable interests of the university, the host community and prospective retail businesses. Sora was selected as the master developer not only for its Mid-Atlantic experience and capabilities, but its flexibility. Many larger, publicly traded development companies have more restrictive financing mechanisms and equity requirements which eliminate them from consideration on projects with longer-term returns.

It has taken eight years to go from the initial exploratory discussions between the university and the municipality and selecting Sora as the developer, through formulating the vision, conducting the studies and creating the plan, to the present, where implementing the plan is underway and the first buildings have opened, with more under construction.

The planning process required conducting a comprehensive study analyzing Glassboro’s market to determine specific, viable strategies, with more than 100 types of retail operations analyzed, along with surveying residents, businesses, property owners, elected officials and a virtually ignored market of students and staff at Rowan University, bordering downtown. The study revealed that student discretionary spending was $18.3 million annually, of which only 18 percent was being captured by downtown businesses, and that an estimated $425 million in overall retail sales was leaking out of Glassboro due to the absence of specific stores and products desired — and needed — by the students, residents and the workforce in Glassboro and the surrounding region.

Rowan Boulevard is the heart of a downtown revitalization which is forming a new 26-acre, pedestrian-friendly corridor stretching a third of a mile from the foot of the Rowan University campus to the center of downtown. The new boulevard will feature broad tree-lined sidewalks, mixed-use buildings with dozens of stores, restaurants featuring café-style sidewalk dining, hundreds of intergenerational residential condos and town homes, university student housing, a hotel-conference center, pedestrian plazas and a town square.

 

Phase I of Rowan University student housing complex on Rowan Boulevard, for 560 students.

A new Rowan University student housing campus for 884 students already has opened on the boulevard, along with the largest Barnes & Noble Collegiate Superstore in New Jersey. The Whitney Center, Rowan Boulevard’s first mixed-use building containing retail and Rowan University honors student program housing, will open for the fall semester 2011. A Courtyard by Marriott hotel is nearing the beginning of construction, and a second mixed-use retail building containing the university’s school of continuing studies and a large, multi-tier parking garage serving students and shoppers, will begin construction in late summer or early fall. Three additional mixed-use buildings offering retail, office space and residential housing also are planned next year.

When complete in 2013, the boulevard will offer a total of 438,000 square feet of student housing space, 234,000 square feet of retail space, 64,000 square feet of office space and another 400,000 square feet of residential space. As many as 60 new retail stores, including a dozen restaurants, are expected along the boulevard, boosting the local economy by more than $48 million annually and generating an estimated $120 million in new property taxes between 2010 and 2038.

To anchor consumer interest, the student housing complex for 884 students was situated at the top of the boulevard, and in addition to these student apartments, Rowan honors students will have housing in the Whitney Center mixed-use retail building, and another university student housing facility is planned adjacent to Rowan Boulevard. Myriad shopping and dining establishments will line the boulevard, which then culminates at a large, new 1½-acre Town Square — the gathering place for community events, concerts and celebrations — which will serve as a catalyst generating foot traffic from top to bottom throughout the year.

Rowan Boulevard’s mix of uses forms distinct, walkable areas, creating a live-work-play environment that will be mutually enjoyed by people of all ages, including the students, office workers, shoppers, residents and visitors. While the students anchor Rowan Boulevard’s success, the boulevard is the cornerstone of a much larger revitalization encompassing a total of 81-acres in several adjoining neighborhoods in Glassboro’s downtown. Overall, Glassboro’s entire revitalization, including Rowan Boulevard, is expected to feature more than 125 new retail stores with the potential of infusing the local economy with $225 million in annual sales when fully completed, providing a new economic engine for the community.

The boulevard not only directly links the university with downtown, it is a focal point of the community – an exciting new multifaceted corridor and an extension of the university’s campus with everything within easy walking distance of student housing. More so, the new boulevard provides character building intergenerational interaction between the students, residents and visitors, along with student work-study job opportunities.

Much more than a financially sound solution to a school’s student housing needs, a public-private-public partnership project brings life and excitement back to downtown, making the community a must-visit destination and providing another excellent asset for marketing the university.


— For information on Rowan Boulevard and Sora Holdings, contact (856) 589-8371 or on the web at 

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