Evolution of the U.S. Student Housing Market Eigen 10 Advisors, LLC - PowerPoint PPT Presentation

Evolution of the U.S. Student Housing Market Eigen 10 Advisors, LLC October 16, 2019 #NMHCstudent #NMHCstudent @ApartmentWire @ApartmentWire

23 Mil illio lion U.S .S. . St Students Enroll lled in in Post-Secondary ry Educatio ion Total Post-Secondary Enrollment Degree-Granting Total Enrollment 383,055 1,276,019 1,695,783 5,258,042 10,430,542 6,438,670 14,582,972 Public Private Non-degree Granting Undergrad FT Undergrad PT Grad FT Grad PT Source: National Center for Education Statistics #NMHCstudent 2 @ApartmentWire

Changin ing Trends - Enroll llment Unaffected (a (and So Sometim imes Im Improved) ) in in Recessio ions 10,000,000 forecast 9,000,000 8,000,000 7,000,000 12/07 6,000,000 -6/09 3/01 Total Enrollment 5,000,000 -11/01 7/90 -3/91 4,000,000 7/81 1/80 -11/82 -7/80 3,000,000 11/73 -3/75 2,000,000 12/69 1,000,000 -11/70 0 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 Public 4 Yr Public 2 yr Private 4 Yr Private 2 Yr Source: National Center for Education Statistics #NMHCstudent 3 @ApartmentWire

In Investors - Recessio 100 120 20 40 60 80 0 2004-01 2004-07 2005-01 2005-07 2006-01 2006-07 ion Concerns Sp 2007-01 2007-07 2008-01 2008-07 Google - Recession Topic Search 2009-01 2009-07 2010-01 2010-07 Spik 2011-01 2011-07 ikin 2012-01 ing 2012-07 2013-01 2013-07 2014-01 2014-07 2015-01 2015-07 2016-01 2016-07 2017-01 2017-07 2018-01 2018-07 2019-01 2019-07 4 @ApartmentWire #NMHCstudent

Enroll llment Growth St Strongest in in So South and West Enrollment Growth by State 2000- 2016 (000s) < 50 50 -100 100-150 > 150 Source: National Center for Education Statistics, 2016 data #NMHCstudent 5 @ApartmentWire

Enrollment Status Estim imatin ing St Student Housin ing Mar arket Siz Size % Undergrads 1.9% 2.3% 0.0% 5.7% 0.5% Pub 4 yr Pub 2 yr 35.0% 15.1% Pub < 2 yr Pr NP 4 yr Pr NP 2 yr 0.3% Pr NP < 2 yr Pr FP 4 yr Pr FP 2 yr Pr FP < 2 yr 39.1% Source: National Center for Education Statistics #NMHCstudent 6 @ApartmentWire

40% of Undergrads are Old lder than 23 yrs and Nearly ly Half lf are In Independent Age Independent, w dependents, married 30+ Independent, w dependents, unmarried / separated Independent, no 24-29 dependents, married Independent, no dependents, unmarried / separated 15-23 Dependent 0% 20% 40% 60% 80% 0% 10% 20% 30% 40% 50% 60% Grad Undergrad Grad Undergrad Source: NCES #NMHCstudent 7 @ApartmentWire

2.7 .7 mil illi lion St Students in in Univ iversit ity Owned Propertie ies – Many Vie iewed as s Mid id to Poor r Quali lity Poor Dorm Quality 20 18 16 14 # of Schools 12 10 8 Dorm 6 Quality D 4 C 2 B 0 A 35 40 45 50 55 60 65 70 75 80 85 % of Students Rating Dorms as High Quality Source: NCES, Survey: Niche.com, 75 largest 4 yr universities #NMHCstudent 8 @ApartmentWire

In Inventory ry Growth Slo Slowin ing in in Univ iversit ity Owned Propertie ies 70,000 100% 99% 60,000 98% 50,000 97% 96% 40,000 Beds 95% 30,000 94% 93% 20,000 92% 10,000 91% 0 90% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Change in # Beds Change in Occ. Beds Occupancy Source: RealPage #NMHCstudent @ApartmentWire

Univ iversit ity Owned – Pace of Cost In Increases Slo Slowin ing 8% 7% 6% 5% 4% 3% 2% 1% 0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Meal Plan Change Room Cost Change Source: RealPage #NMHCstudent @ApartmentWire

62% of St Students Liv ive Off Campus – Not With ith Parents Undergraduates 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Pub 4 yr Pub 2 yr Pub < 2 Pr NP 4 Pr NP 2 Pr NP < Pr FP 4 Pr FP 2 Pr FP < 2 yr yr yr 2 yr yr yr yr Source: National Center for Education Statistics On campus Off campus Living with parents #NMHCstudent 11 @ApartmentWire

8.9 .9 Mil illi lion St Students Need Off-Campus Rental l Housin ing in in 2018 = 8.2 .2% of f U.S. .S. Renter Popula latio ion Graduate Housing Undergraduate Housing 2,000,000 7,000,000 6,000,000 1,500,000 5,000,000 # Students # Students 4,000,000 1,000,000 3,000,000 2,000,000 500,000 1,000,000 - Public 4 Public 2 Private 4 Private 2 - year year year year Public 4 year Private 4 year On Campus Parents Owned Rented On Campus Parents Owned Rented Source: Eigen 10 Advisors, LLC, NCES #NMHCstudent 12 @ApartmentWire

Barri riers to Su Success: : Housin ing In Insecurit ity • 32,000+ Homeless College Students • 8.8% of Undergrads & 8.5% of Grad Students at risk of homelessness • 23.4% of Undergraduates & 17.2% of Graduate Students in Poverty • > 2/3 of Undergrads work while in school Source: HUD, NCES #NMHCstudent 13 @ApartmentWire

Affordabil ilit ity Is Is Im Important 34 34% of of Undergrads an and 38 38% of of Gr Grads Ear arn < < $2 $20, 0,000 per year Total Income (000) for Independent Students or Parents of Dependent Students 45 40 35 30 % of Students 25 20 15 10 5 0 < $10 $10-$19.9 $20-29.9 $30-49.9 $50+ Source: NCES Undergrad Grad #NMHCstudent 14 Source: NCES @ApartmentWire

St Student Housin ing - Newer r Unit its Less Lik ikely ly to Have Double le Occupancy 20% % of Units with Double Occupancy 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Year Built Source: RealPage #NMHCstudent 15 @ApartmentWire

St Student Housin ing Sa Sample le – Convertin ing Estim imated Beds to Unit its Student Competitive 70% > 1 mi from campus 5.4 mil beds, 3.2 mil units Rent by unit % of Beds in 80+ Units: Student Housing Student Competitive 98.6% Student Housing 99.2% 64% < 0.5 mi from campus Beds / Unit: Student Competitive 1.5 0.9 mil beds, 0.3 mil units Student Housing 2.8 Rent by bed Source: RealPage #NMHCstudent @ApartmentWire

St Student Housin ing is is an estim timated 12% of f th the Total l 43.4m unit its in U.S in .S. . Rental l Mark rket Total U.S. Housing Market 1,902,348 45,015 5,466,070 O 1, detached 13,391,503 O 1, attached O 2-4 O 5 to 49 O 50 or more 7,626,626 O Mobile home 2,774,973 O Boat, RV, van, etc. 63,306,236 R 1, detached R 1, attached 12,172,265 R 2-4 R 5 to 49 82,698 R 50 or more 4,702,427 949,429 R Mobile home 1,562,857 4,481,270 1,599,101 Source: U.S. Census #NMHCstudent 17 @ApartmentWire

78% of St Student Housin ing Built ilt in in Last 20 Years # Beds by Decade Built 1,200,000 1,000,000 800,000 600,000 400,000 200,000 - Pre-1970s 1970s 1980s 1990s 2000s 2010+ Student Housing Student Competitive Source: RealPage #NMHCstudent 18 @ApartmentWire

Half lf of Enroll llment is is in in 9 St States Cumulative % %Chg 2000- % of Total of Total Total Enrollment 2016 Market Market US 19,841,014 29.6 CA 2,700,106 19.6 14% 14% TX 1,603,259 55.1 8% 22% NY 1,273,651 22.1 6% 28% FL 1,075,496 52.0 5% 34% IL 777,720 4.5 4% 37% PA 725,770 19.1 4% 41% OH 658,229 19.8 3% 44% AZ 608,084 77.5 3% 47% MI 583,035 2.7 3% 50% NC 561,496 38.8 3% 53% Source: National Center for Education Statistics, 2016 data #NMHCstudent 19 @ApartmentWire

Urb rban & Hard-to to-Buil ild St States – More St Student Competit itiv ive Student Housing Beds Student Competitive Beds 0 40,000 80,000 120,000 160,000 0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 Texas Texas California Florida Florida North Carolina Georgia Georgia New York California North Carolina Michigan Maryland Pennsylvania District of Columbia Alabama Washington Indiana Virginia South Carolina Illinois Arizona Arizona Illinois Pennsylvania Ohio Virginia Ohio Tennessee Michigan Missouri Indiana Louisiana Colorado Massachusetts Mississippi Tennessee Utah New York New Jersey Source: RealPage #NMHCstudent 20 @ApartmentWire

Data - 30 Largest Private Owned Housing Arizona State University Majority of student Texas A&M University University of South Florida University of Texas at Arlington North Carolina State University University of Texas at Austin University of Maryland housing is Student Saint Edwards University University of California - Irvine University of Florida George Washington University University of Nevada - Las Vegas University of Texas at Dallas Competitive – University of Texas at San Antonio Georgia Institute of Technology Florida State University University of North Carolina - Charlotte University of Central Florida Emory University Proportions vary by Ohio State University University of Minnesota Southern Polytechnic State University Texas State University University of Denver Campus. University of Wisconsin - Madison University of Arizona University of Michigan Towson University University of Kentucky 0 10,000 20,000 30,000 40,000 50,000 60,000 Student Housing Student Competitve Source: RealPage #NMHCstudent 21 @ApartmentWire