New Construction in Student Housing
Student Housing a Great Learning Experience
ACROSS CANADA, OVER 940,000 STUDENTS ARE CURRENTLY ENROLLED IN COLLEGES OR UNIVERSITIES. BY SEPTEMBER 2021, THAT NUMBER IS EXPECTED TO INCREASE TO OVER A MILLION.
The Growing Student Market
Renting to students means shorter term leases with more tenants per year than conventional rental apartments. Although many universities are offering more classes during the summer term, the bulk of the market still needs a new apartment lease starting on September 1st, and the summer is a challenging time to keep apartments occupied.
Building the Best
Students will also pay a healthy premium for updated amenities like fitness centres, game rooms and study rooms as well as ease of access to such amenities as restaurants and movie theatres. A good student apartment should feature amenities one would find in a midrange condominium, including flat screen TVs and double beds.
Bigger Investments, Bigger Returns
However, in return for these higher operating costs, students these days have more disposable income, as well as parents and two sets of grandparents willing to help their children take this first step into adult life. A well-designed student apartment will get building owners more dollars per square foot than a conventional apartment.
What to Build, and Where to Build It
Be aware too of the local demographics. Student housing will bring a higher rate of return in centres where more students come from out-of-town. Cities like Toronto and Montreal have well-established universities with large student populations, but George Brown College has a higher portion of students who have grown up near these campuses, and commute from their parents’ homes. On the other hand, 20% of the students attending McGill University come from outside of Canada and have large disposable incomes and a need for luxury student accommodations.
Approaching the Community
Some communities have also had an antagonistic relationship between student communities and local residents, with disputes going before city council. Keep the public informed about your developments, and prepare information for public meetings in order to address the concerns of local residents. Being open to the community response not only helps you to identify and meet demand but helps build your brand as a good neighbour.
Finally, whatever you build, build well. Low-quality product will age quickly and lose its market position. Amenities in line with a condominium lifestyle will help attract the best student tenants paying the highest rents. A well-built, secure facility will also help with the parents’ peace of mind. Building high rise or low rise, concrete or wood frame depends on the target city or town. A mid-rise development is more appropriate in a suburban town like Barrie whereas high rise developments make more sense in Toronto and Montreal.
Student housing is a specialised marketplace requiring specialised knowledge to provide the best rate of return. However, the rapid growth of this marketplace and the quality of the clientele offers many opportunities for a developer willing to take the time to learn the nuances of the marketplace.
IN BUILDING STUDENT HOUSING, IT’S IMPORTANT TO BUILD RELATIONSHIPS WITH THE COLLEGES AND UNIVERSITIES YOU BUILD NEAR. THEY ARE PROVIDING THE BULK OF YOUR MARKET.