CAPRE’s Carolinas Student Housing Forum Preview: Colliers International’s John Manning Says Students Want Proximity to Campus
RALEIGH, NC — The Colliers International NC Multifamily Team focuses exclusively on advising clients with the acquisition, disposition, management and strategic positioning of multifamily properties. They take great pride in tailoring each assignment according to their client’s goals and developing a strategy to maximize the desired result. John Manning is Vice-President of the Colliers Raleigh Office, where he specializes in the disposition and acquisition of multifamily properties, multifamily land, and marquee redevelopment opportunities throughout North Carolina. John will be featured speaker at CAPRE’s Carolinas Student Housing Forum, so we connected with him to talk about some of the driving forces in the region, including proximity and blossoming universities.
CAPRE: Thanks for chatting with us today, John. Let’s talk about the lay of the land regarding student housing in the Carolinas.
Manning: We’ve been busy with all assets of multifamily, but we have a large focus on student housing. I think it’d be crazy to not have a focus on student housing in North Carolina if you’re in the multi-family business.
CAPRE: What’s the headline trendline right now in student housing?
Manning: Proximity. That’s to the university. In the early days of student housing, a lot of the largest developments were built farther away. Students typically lived on campus longer. So as the concept of purpose-built housing came about, they became fully amenitized and more drivable. But today students want everything at their fingertips. They want the amenities, but they also want to be close to campus. They want to be close to activities and bars and nightlife. Students are willing to pay a premium for that—well their parents are – to have that proximity.
CAPRE: What is cementing deals right now?
Manning: The largest wins are focused on that proximity. It’s a lot easier to buy a single tract of land a mile and half away from campus than it is to assemble a number of houses and come up with a couple of acres downtown. but the groups that have been patient and willing to work with the folks on the grounds are seeing a significant return. Their leasing velocities are significantly higher. They’re able to grow their rent at above average rates.
CAPRE: What is something surprising about activity in Carolinas student housing?
Manning: We’ve seen groups in the ACC and SEC football markets align their product near the football stadiums, even when they’re not in the middle of campus. So a lot of that success has come from delivering what student want. The ones that fall too much into that cookie cutter model, of just 4-bedroom apartments, are less appealing. Millennials change every day. They want everything brand new and at their fingertips.
CAPRE: Let’s talk about CAPRE’s upcoming Carolinas Student Housing Forum. What topics are you most looking forward to hearing about or discussing?
Manning: One of the most interesting things in student housing, with regard to this forum, is campus housing. as opposed to off-campus student housing. This means on-campus student apartments. Everybody used to live on-campus or moved off-campus their senior year. But the paradigm has shifted. Students in the last quarter century have decided they want to leave after their first year.
Well, now, the schools are catching on, and saying, we have all this space, and we’re growing, how can we make our properties more appealing? So they give them similar amenities that they could have off-campus, but on-campus. There’s a tremendous amount of synergy to be had there, between universities and the developers. that hasn’t always been the case. Universities are non-profits but the longer you keep students on campus, the more revenue for you and the more success for your students. So I’m looking forward to hearing what the universities have to say about the next generation of on-campus housing.
CAPRE: How are the markets in the Carolinas changing?
Manning: North Carolina has always had excellent universities. Duke, UNC, NC State, but in reality, with there are is also East Carolina, UNC Wilmington, etc. Those are also good universities. And they’ve kept their expenses low. So many people are coming here from out of state, like Maryland, Delaware, where the University of Delaware costs $50,000 a year. By contrast, East Carolina’s out-of-state tuition is only a $27,000 a year school.
Now the reason the Research Triangle has changed so much is because these universities. Folks from out of state are starting to see that they’re also living in these areas that are expensive, and there are these new areas that are really exciting and with an educated workforce. It’s interesting to see the similarities between job growth and enrollment growth. Because these schools are gaining in notoriety, the cities are growing. More people are staying here, more people are wanting to send their kids here. There’s an interesting dynamic between the growth in employment and the growth of the universities.
CAPRE: What is the biggest challenge of working in some of these markets?
Manning: The biggest challenge is that so many of the larger universities are engrained into the urban cores of their cities. they’ve been there forever. So where is the availability for this land? You either have to do adaptive re-use or take down old retail. That can present challenges.
CAPRE: Got it. Thanks for your time, John. We’ll see you in Raleigh!