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BRAILSFORD & DUNLAVEY Comprehensive Housing Market Analysis DRAFT - Executive Summary December, 2007.

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Presentation on theme: "BRAILSFORD & DUNLAVEY Comprehensive Housing Market Analysis DRAFT - Executive Summary December, 2007."— Presentation transcript:

1 BRAILSFORD & DUNLAVEY Comprehensive Housing Market Analysis DRAFT - Executive Summary December, 2007

2 BRAILSFORD & DUNLAVEY Scope & Schedule Review Goals & Objectives Market Analysis Summary Recommendations Presentation Agenda

3 BRAILSFORD & DUNLAVEY Scope & Schedule Review Original Schedule

4 BRAILSFORD & DUNLAVEY Presentation Agenda Scope & Schedule Review Goals & Objectives Market Analysis Summary Recommendations

5 BRAILSFORD & DUNLAVEY SAV Work Session –Educational Outcomes –Enrollment Management –Campus Community –Financial Performance Guides Decision Making i.Quantity and Location of Housing ii.Target Market and Unit Types / Programmatic Priorities iii.Financial Accessibility & Quality Reconciliation iv.Level of Service / Underwriting Criteria & Institutional Will Goals & Objectives Strategic Asset Value (SAV)

6 BRAILSFORD & DUNLAVEY Goals & Objectives SAV Review Educational Outcomes  Freshmen focus and facilities appropriate for freshmen through senior students  Encourage greater faculty participation Enrollment Management  Provide enough housing for 100% freshmen and guarantee Sophomore housing Community Creation  Increase density of students on northeast campus (Hill Square) to establish critical mass  Out of class activity focused at the College House level Financial Performance  New developments should implement sustainable practices per University standards  Achieving occupancy is more important than achieving debt coverage

7 BRAILSFORD & DUNLAVEY Presentation Agenda Scope & Schedule Review Goals & Objectives Market Analysis Summary Recommendations

8 BRAILSFORD & DUNLAVEY a. What’s the market (student perspective) i. Rental rates / occupancy performance ii. Market focus & services iii. Measure impact of location, product type, condition, amenities on prices & occupancy b. Consider the dynamics i. Demand shifts (student & non-student) ii. Projected & potential additions to supply (reductions?) iii. Impact of zoning & land-use policy iv. Market concentrations Market Analysis Off-Campus Housing

9 BRAILSFORD & DUNLAVEY Comparable Product Evaluation Low 1234 High 5 Chestnut Hall DomusThe HubThe Stratum The Radian Individual LeasesXXXOO Roommate MatchingXXOOO Academic Year LeasesOOXOO Social Programming and student focused amenities XOOOO Transportation and proximity to campusOOOOO Balanced unit configurationXXOOO Liberal credit requirements/ Co-signersOOOOO Critical Mass of Penn and Drexel students/ Marketing focus XXOOO Off-Campus Housing Development

10 BRAILSFORD & DUNLAVEY Review of key apartments in the University City district NameZoning Type YearOccupancy rate Total # of beds Chestnut Hall (3900 Chestnut) High-rise apartments & retail %318 DomusHigh-rise apartments & retail Fall % pre-lease 464 The HubHigh-rise apartments & retail Fall %146 The Stratum Student apartments & retail Fall %255 The Radian Student apartments & retail Fall % pre-lease 500 Off-Campus Housing Development 12% of Undergrad & 8% of Grads prefer New Luxury Unit Proximate to Campus

11 BRAILSFORD & DUNLAVEY The Radian LandlordFirst Worthing Unit type1 bed2 bed3 bed4 bed Total # of beds Average square footage Target rent/ person $1350$1200$1050$1025$1175 Co-sign policies Key signatories for the lease may be the applicant & co-signer (s). No minimum income requirement. Lease termsIndividual leases. Academic year lease. AmenitiesShops & restaurants on the first floor, clubroom, Wi-Fi, washer-dryer in each unit. Eco-friendly construction. Rent includes furniture UtilitiesAll utilities are included in the rent. ResidentsThe Radian is focusing on Penn students as the primary target market. Other students from Drexel and University of the Sciences will be part of the secondary target market.

12 BRAILSFORD & DUNLAVEY a. Information goal is qualitative i. What students care about (identify issues) ii. Why they care about it iii. How much they care about it b. Format & Process i. Groups of eight to twelve ii. Planned strategy (macro => micro) iii. Test prevailing wisdom, intercept information & concepts Market Analysis Student Focus Groups

13 BRAILSFORD & DUNLAVEY Market Analysis Student Focus Groups - Undergraduates 3 focus groups, 30+ participants –2 undergraduate on-campus focus groups, both with 10 students each »Students were a diverse group, all academic years, varying majors, and with good representation from RAB as well as other students drawn at random to participate. –1 undergraduate off-campus focus group, with 12 students Students typically look at Penn and other Ivy League Schools Student are familiar with the College House system Freshmen use the Residential Programs to get preferred housing Navigating the College House system is difficult –Overall, students enjoyed living on-campus but were turned off by the housing selection process, decentralization of administration and the disparities in College House conditions and policies –Sophomores feel stuck: stay in current hall or move off campus About ½ have changed College Houses –Many because Quad and Hill are freshman focused and offer facilities that are less appealing to upper class students Satisfaction higher for students at smaller College Houses College House system isn’t perceived as 4 year experience Off-campus leases begin in November & December –Risk the system or go off campus

14 BRAILSFORD & DUNLAVEY a. Quantitative measure i. Current housing choices ii. Views of existing housing operations iii. Preferred housing options iv. Demographics b. Data analysis i. Sample size & integrity ii. Cross-tabs iii. Demand modeling Market Analysis Student Survey

15 BRAILSFORD & DUNLAVEY Market Analysis Student Survey  4,669 Surveys –20% of student population –Closely match student demographics –+/- 1.44% margin of error (95% confidence level)

16 BRAILSFORD & DUNLAVEY Market Analysis Survey Analysis - Undergrad  87% of students said sense of community was important to their college experience  63% prefer to have freshmen-only halls –77% felt it was important to have freshmen-focused communities  23% prefer to living in mixed communities –60% felt is was important to have mixed communities  94% felt is was important to guarantee freshmen & sophomore housing  91% felt is was important to provide suitable junior & senior housing  64% of off-campus students live in 4+ bedroom units  80% of off-campus students found living conditions convenient to class, work, etc.  Median Rent $750/mo incl. utilities (83% 12.mo lease - $9,700/year incl. deposit)  25% prefer a 4-bedroom single on-campus (all other units 2-8% each)

17 BRAILSFORD & DUNLAVEY Market Analysis Peer Institution Analysis College House Peers i. Brown ii. Rice iii. Harvard iv. Yale v. Princeton vi. Columbia vii. Cornell viii. Chicago ix. Wash U. x. Stanford Levels of Research i. Programs ii. Policies iii. Unit Design & Amenities iv. Community

18 BRAILSFORD & DUNLAVEY Market Analysis College House Drivers Key Policies :  Random Assignment to College House –Harvard has Freshmen House System followed by So.-Sr. College House  Commitment thru Sr. Year (Princeton expand Jr & Sr. by 2009) Key Facility Requirements:  Dining halls in each College House  Common Rooms  Students Other Key Factors:  High percentage of students living on campus %  History: College House Systems are years old  No Greek System (Yale is an exception)

19 BRAILSFORD & DUNLAVEY Presentation Agenda Scope & Schedule Review Goals & Objectives Market Analysis Summary Recommendations

20 BRAILSFORD & DUNLAVEY Demand-Based Program (DBP) Capture Rates

21 BRAILSFORD & DUNLAVEY Demand-Based Program (DBP) Capture Rates

22 BRAILSFORD & DUNLAVEY Demand-Based Program (DBP) Capture Rates

23 BRAILSFORD & DUNLAVEY Demand Based Program (DBP)_ Undergraduate Demand (includes impact of Radian)

24 BRAILSFORD & DUNLAVEY Demand Based Program (DBP)_

25 BRAILSFORD & DUNLAVEY Recommendations Existing Conditions Risks: –500 bed Radian comes on line in 2008 Analysis shows that 168 undergrads from on-campus will relocate to Radian –New 340 Bed Complex 2010 Will dilute on-campus demand for, and impact occupancy of, less desirable units and houses Risk Mitigation Strategies: –Strengthen College House System with Key Policy Changes Create Freshmen House system (with appropriate bed type and amenities) Create link to College House for freshmen to matriculate as sophomores Guarantee Sophomore Housing Provide market responsive housing to upper-class students –Convert Sansom to College House or Graduate (not current hybrid) –Develop New Housing as Market Responsive College House Model

26 BRAILSFORD & DUNLAVEY Recommendations College House Goals Goals: –Enhance identification with House –Retain both first and second year students –Retain all upper-class students wanting to remain on campus –Make the best use of existing facilities Small Traditional Houses for Freshman –Ideally with Separate Dining and Programming Areas Larger Houses with more amenities to attract Upper-class students Graduate Housing based on Market Demand

27 BRAILSFORD & DUNLAVEY Recommendations Key Policy Changes Institute Freshmen College & Upper-Class College House System – 2009 Freshmen in traditional-style houses Fisher-Hassenfeld, Hill, Kings Court / English, Riepe, Ware Capacity: 2,349 beds Freshman Class Size: 2,385 students – 2009 Creation of two university-wide College Houses Gregory, Du Bois College Houses that accommodate Freshmen through Senior Students –40 Freshmen in Du Bois / 40 Freshmen in Gregory – 2010 Sophomores, Juniors, and Seniors in mixed-unit College Houses Stouffer, Rodin, Harnwell, Harrison Balance between Sophomore and Upper-Class students so that both groups represent no less than 30% and no more than 70% of the House population

28 BRAILSFORD & DUNLAVEY Recommendations Key Policy Changes with New Development Institute Freshmen College & Upper-Class College House System – 2010 Sophomore Housing Guarantee Bed assignments can accommodate 62% of Sophomores – the maximum number of beds demanded by surveyed students – 2010 Sansom remains primarily Graduate Housing with approximately 300 Undergraduate Beds – 2010 New College House is Developed Balance of Sophomore and Upper-Class Students Suggested configuration based on Demand: –140 Private Suite beds –200 Three- or Four-Bedroom Apartment Private beds

29 BRAILSFORD & DUNLAVEY Recommendations Key Policy Changes & New Development Capture Rates / Assignment Reconciliation House Configuration

30 BRAILSFORD & DUNLAVEY Demand Based Program (DBP)_

31 BRAILSFORD & DUNLAVEY Recommendations Scenario I – Sophomore Guarantee & Sansom as Graduate Housing Institute Freshmen College & Upper-Class College House System – 2009 Freshmen in traditional-style houses Fisher-Hassenfeld, Hill, Kings Court / English, Riepe, Ware Capacity: 2,349 beds Freshman Class Size: 2,385 students – 2009 Creation of two university-wide College Houses Gregory, Du Bois College Houses that accommodate Freshmen through Senior Students –40 Freshmen in Du Bois / 40 Freshmen in Gregory – 2010 Sophomores, Juniors, and Seniors in mixed-unit College Houses Stouffer, Rodin, Harnwell, Harrison Balance between Sophomore and Upper-Class students so that both groups represent no less than 30% and no more than 70% of the House population

32 BRAILSFORD & DUNLAVEY Renovate Sansom for Graduate Housing – 2010 Sansom is renovated to accommodate Graduate Housing Demand Efficiency / One-Bedroom Apartment Private Beds Two-Bedroom Apartment Private Beds No Undergraduate Students Remain in Sansom – 2010 New College House is Developed Balance of Sophomore and Upper-Class Students Suggested configuration Based on Demand: –140 Private Suite beds –200 Three- or Four-Bedroom Apartment Private beds Recommendations Scenario I – Sophomore Guarantee & Sansom as Graduate Housing

33 BRAILSFORD & DUNLAVEY House Configuration Capture Rates / Assignment Reconciliation Recommendations Scenario I – Sophomore Guarantee & Sansom as Graduate Housing

34 BRAILSFORD & DUNLAVEY Demand Based Program (DBP)_

35 BRAILSFORD & DUNLAVEY Recommendations Scenario II – Sophomore Live-on Requirement & Sansom as College House Institute Freshmen College & Upper-Class College House System – 2009 Freshmen in traditional-style houses Fisher-Hassenfeld, Hill, Kings Court / English, Riepe, Ware Capacity: 2,349 beds Freshman Class Size: 2,385 students – 2009 Creation of two university-wide College Houses Gregory, Du Bois College Houses that accommodate Freshmen through Senior Students –40 Freshmen in Du Bois / 40 Freshmen in Gregory – 2010 Sophomores, Juniors, and Seniors in mixed-unit College Houses Stouffer, Rodin, Harnwell, Harrison Balance between Sophomore and Upper-Class students so that both groups represent no less than 30% and no more than 70% of the House population

36 BRAILSFORD & DUNLAVEY – 2010 Sansom is converted into a College House Balance of Sophomore and Upper-Class Students No On-Campus Graduate Housing – 2010 Sophomores Live-On Requirement Approximately 85% of Sophomores are required to live on campus – 2010 New College House is Developed Balance of Sophomore and Upper-Class Students Suggested configuration based on Demand: –140 Private Suite beds –200 Three- or Four-Bedroom Apartment Private beds Recommendations Scenario II – Sophomore Live-on Requirement & Sansom as College House

37 BRAILSFORD & DUNLAVEY Capture Rates / Assignment Reconciliation House Configuration Recommendations Scenario I – Sophomore Live-on Requirement & Sansom as College House

38 BRAILSFORD & DUNLAVEY Demand Based Program (DBP)_

39 BRAILSFORD & DUNLAVEY Comprehensive Housing Market Analysis DRAFT - Executive Summary December, 2007


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