Project Category: Consulting (Market Analysis)

The Flats at Ridgeview

Student Housing Case Study: The Flats at Ridgeview

Location: Las Cruces, New Mexico

University: The Burrell College of Osteopathic Medicine

Background

In September 2017, Campus Advantage Consulting was engaged to perform a market analysis and feasibility study for a new development serving The Burrell College of Osteopathic Medicine (BCOM) in Las Cruces, New Mexico. Given the proposed development’s prime location, lack of purpose-built housing in the market, and the current enrollment, Campus Advantage concluded that the market had the depth to absorb the proposed project. The final report provided recommendations on a unit mix, rental rates, amenities, and prepared a preliminary operating budget for the project.

Campus Advantage was then engaged to perform the initial operations and lease-up of the first BCOM-affiliated housing venture. Campus Advantage worked closely with the developer to review and optimize the building exteriors, unit finishes, and the design of the common area amenities. Recommendations were also made on vendor selection, information technology configuration, FF&E specifications, and operational topics such as lease terms, utility structure, and administrative office set-up. Campus Advantage’s marketing partner, Catalyst, was engaged to brand the development which included design of the logo, tagline, marketing materials, and website.

The Flats at Ridgeview’s first phase opened in August 2018 with an occupancy of 95%. Campus Advantage’s services transitioned into ongoing property management services which includes support for property operations and leasing, creation of annual budgets and marketing campaigns, and delivering the Students First® residence life program. The developer is currently exploring the opportunity of developing a second phase of the project due to the success of phase one.

Case Studies

Exterior of The Flats at Ridgeview

Kitchen

Living Room

Russia

Student Housing Case Study: Russia

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Opening a New Campus in the Russian Far East

Campus Advantage provided four years of consulting services for a new university campus in the Russian Far East. The project was a high-profile initiative of the Ministry of Education to create a world-class institution based on western design and operating standards. Several of Campus Advantage’s team members spent six months living and working at the campus in 2014.

The campus is located on Russian Island near the port city of Vladivostok, next to the border of China on the Sea of Japan. Fall classes commenced in September 2013 with approximately 25,000 students. CA’s work focused on four main areas: residence life programming, on-campus housing management, international marketing, and summer camps and conferences.

Campus Advantage was first invited to assist with the project in 2010 by the builder of the $7 billion project, who was based in Moscow. During visits to Moscow, CA had the opportunity to meet with several high-ranking leaders in the Russian federal government who were educated in the United States and Western Europe. These individuals were very interested in replicating the feel and atmosphere of western campuses at the new university in Vladivostok with the goal of attracting international students and faculty.

The campus includes over 12,000 beds of new housing. A team of architects from Moscow and the United States worked together with CA’s consulting group to design and plan the unit mix, common areas, and amenity spaces throughout the residence halls. This was the first new university built in Russia in many years, and the goal was to incorporate a true residential experience based on western traditional campuses.

Campus Advantage’s time in Russia was carefully designed to provide the university with tools that would assist their goals of raising their QS World University Ranking and becoming a world-class institution. The consulting team worked closely with university staff to provide training, policies, and procedures. One of the most exciting tasks accomplished was the development and implementation of the first Resident Assistant program in the country. With help from higher education marketing agency Catalyst, Campus Advantage developed recruiting concepts and materials that led to hundreds of students applying and interviewing to be chosen for the program.

Campus Advantage shared policies and procedures to help the campus create a roommate-matching program and customer-service-based management practices. CA also recommended special programs to assist international students and further advised on methods to increase access for students with disabilities. By putting a summer-turn plan in place, CA provided the university with the necessary tools to handle students moving in and out over a short period of time.

Working closely with Catalyst, CA was able to present the concept of a campus mascot and a university merchandise program. A faculty committee and student organization reviewed several mascot concepts and designs, along with a business plan for launching university spirit-wear and other branded products.

The work Campus Advantage conducted at Far Eastern Federal University provided them with the tools necessary to increase their QS World University Ranking — as well as ShanghaiRanking’s Academic Ranking of World Universities and the Times Higher Education World University Rankings — and was very well received by both the Russian federal government and the university. CA worked with Erik Holm-Olsen at the U.S. Consulate in Vladivostok, who stated, “Campus Advantage, from everything I have seen, has been an excellent representative of the American private sector in Vladivostok.”

A sampling of accomplishments:

  • Introduced residence life programming to the FEFU campus
  • Created a mascot and a university merchandise program
  • Implemented world-class standards for residence hall management
  • Provided multiple opportunities to expand conference business at FEFU
  • Hosted several events on campus for students, allowing the FEFU staff and students to interact socially
  • Designed furniture and décor for leisure areas in the building

The Luxx

Student Housing Case Study: San Antonio, TX

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Market Analysis and Feasibility Study

Campus Advantage was engaged by a private developer to perform a market analysis and feasibility study for a new development near the University of Texas at San Antonio (UTSA). Campus Advantage evaluated the on- and off-campus housing market, analyzed historical enrollment trends and future growth at the university, and conducted informal interviews with students to determine the potential demand for a new student housing development. Campus Advantage discovered that UTSA was transitioning from a regional school, serving mostly commuter students, into a major university that recruits students from across the state and abroad. In 2002, their total enrollment was 22,016, of which 62% originated from Bexar County, where the campus is located. Fall 2015 had a total enrollment of 28,787, a 31% increase. Bexar County residents dropped to 47% of the population, and students coming from other counties in Texas increased over 83%, accounting for an additional 6,000 students. International students, as well as out-of-state students, almost doubled as well.

Campus Advantage’s analysis included the following:

Market:

  • An overview of competitive properties in the market
  • A rate analysis of competitive properties
  • An overview of new developments in the pipeline

 

University:

  • Enrollment trends
  • Enrollment projections
  • An overview and rates for on-campus residence halls/apartments

 

New Development:

  • An analysis of the proposed site location
  • Rate recommendations
  • Amenity recommendations
  • Operational recommendations
  • Marketing and leasing recommendations
  • Proposed unit layouts
  • An absorption analysis

 

As a result of the study, Campus Advantage concluded that the San Antonio student market could absorb the proposed project given its excellent location, the lack of a freshman live-on requirement, and the relatively few number of on- and off-campus beds. Campus Advantage knew the market would be very competitive since all nine of the off-campus student housing properties were newer product and offered desirable amenity packages, so extra focus was placed on the unit layouts and unique amenities, including a two-story fitness center and Vegas-style pool area. These amenities made the development stand out from the competition and created a strong level of interest with the students. The property, with 690 beds, opened at 94% occupancy in fall 2014, while the rest of the market averaged 89.6% occupancy. Since the desired occupancy was not achieved in the initial lease-up, the developer hired Campus Advantage to manage the property in May 2015.

Case Studies

The Knox

Student Housing Case Study: The Knox

When ideal location meets differentiated value driving a 95% pre-lease rate and pre-leasing revenue at 101% of projections, you know there’s more than luck involved. And that was certainly the case with The Knox, a new student housing property completed in August 2016 near University of Tennessee in Knoxville, TN, developed by Campus Advantage and Pinecrest.

As the result of an advanced ranking analysis of 240 university markets, Campus Advantage identified the University of Tennessee as a market ripe for new housing. After identifying the market, Campus Advantage evaluated three different sites and chose the one with an irreplaceable location.

The development sits in a transitional zone with historical significance on one side of the block consisting of low density early 19th century housing, and the other side of the block unfettered zoning-wise, facing a 12 story University of Tennessee Residence hall. Entitling the site within an historical district required a great deal of flexibility. Working closely with the local historic Fort Sanders neighborhood group, Kelly Grossman Architects, and Kelle Contine Interior Design to ensure the design integrated with the surroundings, the project incorporates a high density modern mid-rise on the side of the site facing the university with a more traditional, lower density three story walk-up with faux porches to fit the historical context facing the historic district. They are brought together by a large outdoor green roof deck.

To achieve strong occupancy and rental rates compared to other similar projects in the market, the project ensured on-time delivery in its initial lease up. It additionally offers amenities geared towards outdoor leisure activities, nice weather and the active nature of Knoxville residents, including a 12,200 SF outdoor green roof deck that boasts multiple hot tubs, televisions, cabanas, grills and an outdoor fireplace as well as a “Starbucks-type” lounge, game centers, study rooms, a clubhouse and a state-of-the-art fitness center.

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  • Role: Developer, Manager, Marketer
  • Location: Knoxville, TN (University of Tennessee)
  • Entitlement & Design Timeline: June 2013 – Feb 2014
  • Ground breaking: November 2014
  • Delivery: May 2016
  • Beds: 385
  • Strategy: Merchant Build
  • Hard Construction Cost: $20.3 million
  • Total Development Cost: $29.1 million
  • Loan-to-Cost: 70% (hypothetical)
  • 7.43% Yield on Cost (pro forma)
  • 26.2% IRR (pro forma)
  • 2.1x MOIC (pro forma)
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