Student Housing West 1. Project Overview 2. Objectives 3. Key Findings 4. Market Analysis Detailed Findings 5. Survey Analysis 6. Demand Analysis 7. Next Steps
Project Overview • Public-Private Partnership Capstone Development Partners, LLC • Project is based upon demand findings from B&D’s 2014 Student Housing Market Study • 3,073 beds to be delivered by 2022 Undergraduate housing (2,713 beds) Graduate housing (220 beds) Family housing (140 Units) • Project allows UCSC to de-densify existing residence halls (773 beds due to overcrowding) • This study has been commissioned by Collegiate Housing Foundation for the purposes of project financing.
Student Housing Demand Analysis • Update the 2014 Student Housing Market Study to secure project. • Confirm demand for campus housing at the proposed rental rates. • Understand demand by housing type to refine the overall project program. • Assess the nature of the off-campus market and compare rental rates to those proposed for Student Housing West. • Confirm that the proposed project will not negatively impact existing housing.
Student Housing Demand Analysis • Enrollment continues to increase while housing supply has remained constant placing significant pressure on the UCSC community. • UCSC has added more than 2,400 beds of residential density within existing halls, which impacts the available community space and the overall student residential experience. • Overall on- and off-campus housing satisfaction is low and has declined since 2014 – illustrating the challenges the UCSC community experiences living in Santa Cruz. • Demand exists for 13,102 students to live on campus: ⎼ 11,626 undergraduate beds ⎼ 1,066 graduate beds ⎼ 310 family units • Unmet demand totals 1,660 after new Student Housing West beds and de-densification are factored. • De-densification of existing residence halls can be used to mitigate occupancy risk during the Student Housing West absorption period. • The proposed single occupancy Student Housing West rental rates are very competitive with the off- campus market. • UCSC students are very price sensitive – all decisions should be made to minimize the impact on rent.
Market Analysis • Enrollment continues to grow, placing significant pressure on the University, its housing system, and the Santa Cruz community. • Housing occupancy has remained strong, operating at an average of 97% of all available housing beds since 2012. • The Santa Cruz off-campus housing market is challenging due to poor quality and quantity of housing stock, high rents, and policies that are not student tenant friendly. • UCSC has increased housing capacity by densifying existing residence halls through the use of triple occupancy units and converted lounge spaces. Densification has created an operational challenge and impacted the student experience.
Market Analysis 25,000 +12% 20,000 1,880 1,821 1,589 1,637 1,508 15,000 Undergrad Enrollment Since 2013 10,000 17,577 16,962 +25% 16,277 16,231 15,695 5,000 Graduate Enrollment 0 2013 2014 2015 2016 2017 Since 2013 Undergraduate Enrollment Graduate Enrollment Enrollment growth without corresponding housing supply growth is placing significant pressure on UCSC Source: UCSC Common Data Sets Available from UCSC Institutional Research, Assessment, and Policy Studies
Market Analysis 3.75 97% Full Time 51% Female 49% Male 3% Part Time Avg. High School GPA *Full time population has *Percentages of female (Up 3% from 2013) been increasing over the past population decreased by 3% five years by 12%. over the past seven years. 90% First to Second-Year Retention Rate 6.0% Other 22% Freshman 4.0% African American 71% 19% Sophomore 1.0% Alaskan/Native 23% Junior 28% Asian 26% Senior 28% Hispanic/Latino 10% Graduate 31% White 6-Year Graduation Rate 2.0% Unknown (up 2% from 2006 cohort) UCSC’s student academic and demographic profile are consistent with those who would likely live on campus Source: UCSC Institutional Research, Assessment, and Policy Studies
Market Analysis Total Beds Capacity Additional Density Operating Capacity College Facility Other Adjustments 9,338 (Beds) (Beds) (Beds) Student Housing West Cowell College 639 241 (6) 874 allows UCSC to de-densify Additional Density Stevenson College 597 305 (3) 899 2,278 existing housing by up to Crown College 635 290 (91) 834 773 beds Merrill college 686 114 (2) 798 Porter College 705 134 (3) 836 Capacity 7,060 Kresge college 385 135 (20) 500 Oakes College 565 216 (1) 780 Rachel Carson College 626 255 (12) 869 College Nine 698 340 (10) 1,028 College Ten 417 205 0 622 Transfer Community 408 131 0 539 The Village 153 0 0 153 Rewood Village 115 36 0 151 University Town Center 108 29 0 137 Graduate Student Housing 82 0 (2) 80 Camper Park 42 0 0 42 Family Student Housing 199 0 (3) 196 Subtotal 7,060 2,431 (153) 9,338 The additional residential density impacts the student residential experience and creates logistical challenges for UCSC
Market Analysis Housing Occupancy of Available Beds 99% 98% 97% 96% 96% 96% 2012 2013 2014 2015 2016 2017 With added residential density, UCSC operated at 127% of original design capacity within the existing residence halls.
Market Analysis Population 62,752 Median Age 28.7 Non-Family Households 40% Total Housing Units 23,499 Owner Occupied 44% % Multi-Unit Structures 33% Source: 2015 5-year census at censusreporter.org Santa Cruz is considered a student-averse market because landlords do not have student-friendly lease terms, the limited supply of housing, high rental rates, and a challenging town-gown relationship.
Market Analysis • Survey of 7 comparable multi- family properties • 904 units • Average property is 129 units • 3.1% vacancy • Multi-family properties generally have limited amenities: ⎼ Fitness Centers ⎼ Outdoor patios with grill areas ⎼ Fenced picnic area ⎼ Washer / dryer in unit ⎼ Trash removal ⎼ Limited off-street parking UC Santa Cruz Property Source: REIS Q1 2018 data of comparable properties to the SHW Project
Rental Rate Per Unit Per Month There is a scarcity of three and four-bedroom units within the market. Larger units are attractive to students because they can spread the cost of rent among more people. Source: REIS Q1 2018 data of comparable properties to the SHW Project
Market Analysis • 420 proposed / under construction units in Santa Cruz • Mix of multi-unit apartments and townhouses under permit / review • New units are not directly intended for UCSC students UC Santa Cruz Proposed Projects
Market Analysis 716 Darwin Street Upper Crust Apartments � Address: 716 Darwin � Address: 2415 Mission St St (8) 1BR, (4) 3BR, and (2) � � 15-unit apartment 2BR units building � Status: Under review � Status: Permits � Delivery: TBD approved � Delivery: 2018 River Street 230 Grandville Street Townhomes � Address: 350 Ocean Street � Address: 232 River St � 12 3BR apartments � 12-unit residential � Status: Under construction development � Delivery: TBD � Status: Permits approved Delivery: TBD � Students are generally not the target market for new housing development in Santa Cruz. Source: City of Santa Cruz, Planning and Community Development Market
Market Analysis Proposed Graduate and Family units at Student Housing West are priced competitively with the average off-campus rental rates.
Survey Analysis Importance of the availability of housing in decision to attend UCSC Total Responses 89% 3,352 55% 17% of Survey Sample Undergrad Graduate Percent Complete 86% Confidence Level 95% Margin of Error 2%
Survey Analysis On-Campus Residents Off-Campus Residents 64% 60% Overall Satisfaction Overall Satisfaction 82% 88% 61% 57% Physical Condition Physical Condition 82% 88% 55% 60% Size of Unit Size of Unit 78% 86% 52% 57% Amenities / Services Amenities / Services 71% 86% 29% 33% Housing Rate Housing Rate 28% 63% 2018 2014 2018 2014 The steep decline in off-campus housing rate satisfaction suggests that students do not see the value in their housing situation as evidence by the decline in all other factors.
Survey Analysis Decision Driver ALL On-Campus Off-Campus 1 Total cost of rent and utilities 65% 53% 89% 2 Proximity to classes 53% 65% 31% 3 Ability to choose my own roommate(s) 30% 26% 40% 4 Housing guarantee for on-campus residents 30% 45% 3% 5 Availability of a kitchen 28% 21% 41% 6 Availability of high-speed Internet 28% 32% 19% 7 Availability of a private (single) bedroom 22% 15% 34% 8 Proximity to, or availability of, convenient parking or public transportation 21% 14% 34% 9 Access to campus dining 21% 32% 1% 10 Availability of convenient laundry facilities 19% 18% 20% > 10% of the average < 10% of the average On-campus residents are driven by convenience, cost, and the housing guarantee Off-campus residents are driven by cost, privacy and independence, and transportation to campus
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