The Rise of Hybrid Student Apartment Projects

A new student housing product is arriving on the market: a hybrid of both traditional by-the-bed student housing and conventional by-the-unit apartments for adult professionals. The model isn’t surprising, considering some of the challenges with student housing, however, student housing expert Frederick W. Pierce of Pierce Education Properties says that this will likely remain a niche product type, rather than a standard in student housing. In fact the trend isn’t being widely adopted.

“There is not much of this going on in terms of new construction or purpose-built student housing –meaning, very few projects are being built with the express intent of it being student housing but having non-student occupants.  It is very difficult and complicated to offer by-the-bed leasing at the same time as joint-and-several, by-the-unit leasing,” Pierce tells GlobeSt.com. “The rental rates are often different and so are the lease terms.”

However, there is opportunity, particularly in converting portions of existing apartment buildings. “That being said, there is an enormous inventory of conventional apartments, like those built with a conventional unit mix of studio, one and two bedroom apartments, located near universities that are leased on a joint-and-several basis. Most were built in the 60s, 70s and 80s and are occupied by students,” says Pierce. “The closer these are to a university, the higher the percentage of residents are students.  Most all these offer leases that conform to the academic year. This, however, is not considered student housing. These are conventional apartments occupied by students.”