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[IMGCAP(1)]DALLAS-The National Apartment Association’s first student housing conference has attracted more than 700 professionals and 94 exhibitors from the day-to-day trenches to dissect a niche sector that’s steadily gaining ground as an investment class. With IRR as the bottom line, the idea exchange is a mix of bricks-and-mortar talk and the psychology of dealing with the Millennial generation.

“It’s the fastest growing niche market in housing,” says Douglas Culkin, president of the Arlington, VA-based NAA. “And, we’re looking to grow it in the future.” Not only is the Dallas assembly the largest student housing conference ever held, but he points out that it’s the first one aimed at the operations end.

The conference, being held at the Fairmont Hotel at 1717 N. Akard St. in the CBD, ends this afternoon. Conference-goers from all over the US are putting the industry under the microscope, whether it’s marketing or building the New Millennium version of dormitory life so that parents and students alike are drawn to their products, which are for the most part off-campus developments.

The most significant change in the arena in recent years has been “the acceptance” of student housing projects as an investment class, according to [IMGCAP(2)]Richard Wilhelm, shareholder in the Dallas-based law firm of Munsch Hardt Kopf & Harr. “Fifteen years ago, it was difficult to find lenders and investors. Now, it’s becoming a standard item in most people’s portfolios,” he tells GlobeSt.com. “It has been hard for people to understand how this can make money. But, it really is doing very well.”

This afternoon, Wilhelm and Brad Krouse with Klehr, Harrison, Harvey, Branzburg & Ellers LLP of Cherry Hill, NJ, will discuss legal issues of the industry, including leases and co-habitation agreements that guarantee rents and utilities will be paid and responsibility for damage claims. “Leases have to be very clear,” Wilhelm stresses.

The afternoon sessions also probe “the turn,” a two-week period for managers and owners to redo units between move-outs and move-ins. “It’s a madhouse. That’s one of the important things that people don’t realize and it’s a critical issue in student housing,” Wilhelm says.

Private developers of student housing, whether on campus or off, are relying on luxury hotel amenities and highly trained property managers and marketing teams as bait for a generation of students who’ve turned their backs on dormitories of yesteryear so they can live like they did or better than at home. Studies show that 70% or 6.6 million students live off campus–and developers are building in perks like theaters, top-of-the-line fitness centers, tanning salons, coffee shops, X-box game rooms and WiFi areas as drawing cards. Private bedrooms with broadband access and baths with community living areas are the norm.

To help the industry understand its market, the NAA’s keynote speaker yesterday was Cam Marston, COO of Mobile, AL-based Marston Communications, a generational-focused consulting firm to help corporate America deal with a new breed of Gen X and Millennial workers whose attitudes and demands are vastly different from employees of the past. The bottom line is finding and retaining employees and tenants alike in a generation accustomed to privilege, technology and instant gratification.

“You live with them. You work with them. And, they live in your rooms,” Marston told the NAA crowd. “They have more individuality and more demands to be different from their preceding generations.” He explains that the behavioral changes are creeping into every sociological barometer, whether it’s delaying career choices or marrying later in life.

“The manager sometimes has to be a counselor or a mediator. You cannot get that type of attitude from a 20-page management agreement,” Wilhelm explains. “It has to be something more and that’s what makes a student housing project succeed.”

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