BRAILSFORD & DUNLAVEY Comprehensive Housing Market Analysis DRAFT - Executive Summary December, 2007
Jan 01, 2016
BRAILSFORD & DUNLAVEY
Comprehensive Housing Market Analysis
DRAFT - Executive SummaryDecember, 2007
BRAILSFORD & DUNLAVEY
Scope & Schedule Review
Goals & Objectives
Market Analysis Summary
Recommendations
Presentation Agenda
BRAILSFORD & DUNLAVEY
Scope & Schedule ReviewOriginal Schedule
Phase I - Institutional Analysis
Strategic Asset Value Analysis (Visioning)
Existing Conditions Analysis
Concept Development Focus Groups
Phase II - Market Analysis
On-Campus Market Analysis (Survey)
Off-Campus Market Analysis
Peer Institution Analysis (Benchmarking)
Competitive Context (Price Point Analysis)
Concept Refinement Focus Groups
Phase III - Financial Analysis
Phase IV - Comprehensive Program Plan
Site Visits
J uly August SeptemberMarch April May June
*
Kickoff Meeting
Survey Implementation
*
cc
Survey Analysis*
Market Analysis
c
Financial Analysis
Plan Developmen
t
Final Presentation
*
*
Plan Refinement
FinancialWorksession
BRAILSFORD & DUNLAVEY
Presentation Agenda
Scope & Schedule Review
Goals & Objectives
Market Analysis Summary
Recommendations
BRAILSFORD & DUNLAVEY
SAV Work Session– Educational Outcomes– Enrollment Management– Campus Community– Financial Performance
Guides Decision Makingi. Quantity and Location of Housingii. Target Market and Unit Types / Programmatic
Prioritiesiii. Financial Accessibility & Quality Reconciliationiv. Level of Service / Underwriting Criteria &
Institutional Will
Low High
0Current Conditions: xAspirations: O
I. Educational Outcomes a. Supervision Through Maturity
b. Proximity to Educational Resources
c. Personal Development
d. Direct Curriculum Enhancement
e. Development Continuum
II. Enrollment Management a. Housing Market Supplement
b. Competitive Amenity
III. Campus Community a. “Residential Campus” Designation
b. Out-of-class Activity
c. Neighborhood Creation
d. Quality of Life System Integration
IV. Financial Performancea. Balance Sheet Utilization
b. Revenue/Occupancy Risk Tolerance
c. Financial Accessibility
d. Level of Service
e. Sustainable Design and Operations
Targeted Strategic Value
10
Goals & ObjectivesStrategic Asset Value (SAV)
BRAILSFORD & DUNLAVEY
Goals & Objectives SAV Review
Educational Outcomes Freshmen focus and facilities appropriate for freshmen through senior students Encourage greater faculty participation
Enrollment Management Provide enough housing for 100% freshmen and guarantee Sophomore housing
Community Creation Increase density of students on northeast campus (Hill Square) to establish
critical mass Out of class activity focused at the College House level
Financial Performance New developments should implement sustainable practices per University
standards Achieving occupancy is more important than achieving debt coverage
BRAILSFORD & DUNLAVEY
Presentation Agenda
Scope & Schedule Review
Goals & Objectives
Market Analysis Summary
Recommendations
BRAILSFORD & DUNLAVEY
a. What’s the market (student perspective)i. Rental rates / occupancy performanceii. Market focus & servicesiii. Measure impact of location, product type,
condition, amenities on prices & occupancy
b. Consider the dynamicsi. Demand shifts (student & non-student)ii. Projected & potential additions to supply
(reductions?)iii. Impact of zoning & land-use policyiv. Market concentrations
Market AnalysisOff-Campus Housing
$558$578
$401
$470
$364
$668
$462
$427
$550
$646
$747
$0
$100
$200
$300
$400
$500
$600
$700
$800
ST. 1-BR 2-BR 3-BR
Walking Distance (under 2 miles) 2 to 5 Miles Greater than 5 Miles
Avg: $409Avg: $454
Avg: $688
Avg: $577
$0
$200
$400
$600
$800
$1,000
$1,200
ST. 1-BR 2-BR 3-BR
$600/month for on-campus 2-BR
BRAILSFORD & DUNLAVEY
Comparable Product Evaluation Low
1 2 3 4
High
5
Chestnut Hall
Domus The Hub The Stratum
The Radian
Individual Leases X X X O O
Roommate Matching X X O O O
Academic Year Leases O O X O O
Social Programming and student focused amenities
X O O O O
Transportation and proximity to campus
O O O O O
Balanced unit configuration X X O O O
Liberal credit requirements/ Co-signers O O O O O
Critical Mass of Penn and Drexel students/ Marketing focus
X X O O O
Off-Campus Housing Development
BRAILSFORD & DUNLAVEY
Review of key apartments in the University City district
Name Zoning Type
Year Occupancy rate
Total # of beds
Chestnut Hall
(3900 Chestnut)
High-rise apartments
& retail
1918 90% 318
Domus High-rise apartments
& retail
Fall 2007
20%
pre-lease
464
The Hub High-rise apartments
& retail
Fall 2006
100% 146
The Stratum
Student apartments
& retail
Fall 2007
55% 255
The Radian
Student apartments
& retail
Fall 2008
70%
pre-lease
500
Off-Campus Housing Development12% of Undergrad & 8% of Grads prefer New Luxury Unit Proximate to Campus
BRAILSFORD & DUNLAVEY
The RadianLandlord First Worthing
Unit type 1 bed 2 bed 3 bed 4 bed 4 bed Total
# of beds 22 16 102 316 44 500
Average square footage
560 755 1013 1269 1426
Target rent/ person
$1350 $1200 $1050 $1025 $1175
Co-sign policies
Key signatories for the lease may be the applicant & co-signer (s). No minimum income requirement.
Lease terms Individual leases. Academic year lease.
Amenities Shops & restaurants on the first floor, clubroom, Wi-Fi, washer-dryer in each unit. Eco-friendly construction. Rent includes furniture
Utilities All utilities are included in the rent.
Residents The Radian is focusing on Penn students as the primary target market. Other students from Drexel and University of the Sciences will be part of the secondary target market.
BRAILSFORD & DUNLAVEY
a. Information goal is qualitativei. What students care about (identify issues)ii. Why they care about itiii. How much they care about it
b. Format & Processi. Groups of eight to twelveii. Planned strategy (macro => micro)iii. Test prevailing wisdom, intercept information &
concepts
Market AnalysisStudent Focus Groups
BRAILSFORD & DUNLAVEY
Market AnalysisStudent Focus Groups - Undergraduates
• 3 focus groups, 30+ participants– 2 undergraduate on-campus focus groups, both with 10 students each
» Students were a diverse group, all academic years, varying majors, and with good representation from RAB as well as other students drawn at random to participate.
– 1 undergraduate off-campus focus group, with 12 students • Students typically look at Penn and other Ivy League Schools• Student are familiar with the College House system• Freshmen use the Residential Programs to get preferred housing• Navigating the College House system is difficult
– Overall, students enjoyed living on-campus but were turned off by the housing selection process, decentralization of administration and the disparities in College House conditions and policies
– Sophomores feel stuck: stay in current hall or move off campus• About ½ have changed College Houses
– Many because Quad and Hill are freshman focused and offer facilities that are less appealing to upper class students
• Satisfaction higher for students at smaller College Houses• College House system isn’t perceived as 4 year experience• Off-campus leases begin in November & December
– Risk the system or go off campus
BRAILSFORD & DUNLAVEY
a. Quantitative measurei. Current housing choicesii. Views of existing housing operationsiii. Preferred housing optionsiv. Demographics
b. Data analysisi. Sample size & integrityii. Cross-tabsiii. Demand modeling
Market AnalysisStudent Survey
BRAILSFORD & DUNLAVEY
Market AnalysisStudent Survey
4,669 Surveys– 20% of student population– Closely match student demographics– +/- 1.44% margin of error (95% confidence level)
Survey Significance
1.00%
3.00%
5.00%
7.00%
9.00%
11.00%
13.00%
15.00%
100
300
500
700
900
1,10
01,
300
1,50
01,
700
1,90
02,
100
2,30
02,
500
2,70
02,
900
3,10
03,
300
3,50
03,
700
3,90
04,
100
4,30
04,
500
4,70
0
Survey Response
Su
rve
y M
arg
in o
f E
rro
r
BRAILSFORD & DUNLAVEY
Market AnalysisSurvey Analysis - Undergrad
87% of students said sense of community was important to their college experience 63% prefer to have freshmen-only halls
– 77% felt it was important to have freshmen-focused communities 23% prefer to living in mixed communities
– 60% felt is was important to have mixed communities 94% felt is was important to guarantee freshmen & sophomore housing 91% felt is was important to provide suitable junior & senior housing 64% of off-campus students live in 4+ bedroom units 80% of off-campus students found living conditions convenient to class, work, etc. Median Rent $750/mo incl. utilities (83% 12.mo lease - $9,700/year incl. deposit) 25% prefer a 4-bedroom single on-campus (all other units 2-8% each)
BRAILSFORD & DUNLAVEY
Market Analysis Peer Institution Analysis
College House Peersi. Brownii. Riceiii. Harvardiv. Yalev. Princetonvi. Columbiavii. Cornellviii. Chicagoix. Wash U.x. Stanford
Levels of Researchi. Programsii. Policiesiii. Unit Design & Amenitiesiv. Community
BRAILSFORD & DUNLAVEY
Market Analysis College House Drivers
Key Policies: Random Assignment to College House
– Harvard has Freshmen House System followed by So.-Sr. College House Commitment thru Sr. Year (Princeton expand Jr & Sr. by 2009)
Key Facility Requirements: Dining halls in each College House Common Rooms 300-500 Students
Other Key Factors: High percentage of students living on campus 70 - 98% History: College House Systems are 60 - 100years old No Greek System (Yale is an exception)
BRAILSFORD & DUNLAVEY
Presentation Agenda
Scope & Schedule Review
Goals & Objectives
Market Analysis Summary
Recommendations
BRAILSFORD & DUNLAVEY
Demand-Based Program (DBP)Capture Rates
BRAILSFORD & DUNLAVEY
Demand-Based Program (DBP)Capture Rates
BRAILSFORD & DUNLAVEY
Demand-Based Program (DBP)Capture Rates
BRAILSFORD & DUNLAVEY
Demand Based Program (DBP)_Undergraduate Demand (includes impact of Radian)
BRAILSFORD & DUNLAVEY
Demand Based Program (DBP)_
BRAILSFORD & DUNLAVEY
RecommendationsExisting Conditions
Risks:– 500 bed Radian comes on line in 2008
• Analysis shows that 168 undergrads from on-campus will relocate to Radian– New 340 Bed Complex 2010
• Will dilute on-campus demand for, and impact occupancy of, less desirable units and houses
Risk Mitigation Strategies:– Strengthen College House System with Key Policy Changes
• Create Freshmen House system (with appropriate bed type and amenities)• Create link to College House for freshmen to matriculate as sophomores• Guarantee Sophomore Housing• Provide market responsive housing to upper-class students
– Convert Sansom to College House or Graduate (not current hybrid)– Develop New Housing as Market Responsive College House Model
BRAILSFORD & DUNLAVEY
RecommendationsCollege House Goals
Goals:– Enhance identification with House– Retain both first and second year students – Retain all upper-class students wanting to remain on campus– Make the best use of existing facilities
• Small Traditional Houses for Freshman– Ideally with Separate Dining and Programming Areas
• Larger Houses with more amenities to attract Upper-class students• Graduate Housing based on Market Demand
BRAILSFORD & DUNLAVEY
RecommendationsKey Policy Changes
Institute Freshmen College & Upper-Class College House System– 2009 Freshmen in traditional-style houses
• Fisher-Hassenfeld, Hill, Kings Court / English, Riepe, Ware• Capacity: 2,349 beds 2006-07 Freshman Class Size: 2,385 students
– 2009 Creation of two university-wide College Houses• Gregory, Du Bois• College Houses that accommodate Freshmen through Senior Students
– 40 Freshmen in Du Bois / 40 Freshmen in Gregory
– 2010 Sophomores, Juniors, and Seniors in mixed-unit College Houses• Stouffer, Rodin, Harnwell, Harrison• Balance between Sophomore and Upper-Class students so that both groups
represent no less than 30% and no more than 70% of the House population
BRAILSFORD & DUNLAVEY
RecommendationsKey Policy Changes with New Development
Institute Freshmen College & Upper-Class College House System– 2010 Sophomore Housing Guarantee
• Bed assignments can accommodate 62% of Sophomores – the maximum number of beds demanded by surveyed students
– 2010 Sansom remains primarily Graduate Housing with approximately 300 Undergraduate Beds
– 2010 New College House is Developed• Balance of Sophomore and Upper-Class Students• Suggested configuration based on Demand:
– 140 Private Suite beds– 200 Three- or Four-Bedroom Apartment Private beds
BRAILSFORD & DUNLAVEY
RecommendationsKey Policy Changes & New Development
Capture Rates / Assignment Reconciliation
House Configuration
BRAILSFORD & DUNLAVEY
Demand Based Program (DBP)_
BRAILSFORD & DUNLAVEY
RecommendationsScenario I – Sophomore Guarantee & Sansom as Graduate Housing
Institute Freshmen College & Upper-Class College House System– 2009 Freshmen in traditional-style houses
• Fisher-Hassenfeld, Hill, Kings Court / English, Riepe, Ware• Capacity: 2,349 beds 2006-07 Freshman Class Size: 2,385 students
– 2009 Creation of two university-wide College Houses• Gregory, Du Bois• College Houses that accommodate Freshmen through Senior Students
– 40 Freshmen in Du Bois / 40 Freshmen in Gregory
– 2010 Sophomores, Juniors, and Seniors in mixed-unit College Houses• Stouffer, Rodin, Harnwell, Harrison• Balance between Sophomore and Upper-Class students so that both groups
represent no less than 30% and no more than 70% of the House population
BRAILSFORD & DUNLAVEY
Renovate Sansom for Graduate Housing– 2010 Sansom is renovated to accommodate Graduate Housing Demand
• Efficiency / One-Bedroom Apartment Private Beds
• Two-Bedroom Apartment Private Beds
• No Undergraduate Students Remain in Sansom
– 2010 New College House is Developed• Balance of Sophomore and Upper-Class Students• Suggested configuration Based on Demand:
– 140 Private Suite beds– 200 Three- or Four-Bedroom Apartment Private beds
RecommendationsScenario I – Sophomore Guarantee & Sansom as Graduate Housing
BRAILSFORD & DUNLAVEY
House Configuration
Capture Rates / Assignment Reconciliation
RecommendationsScenario I – Sophomore Guarantee & Sansom as Graduate Housing
BRAILSFORD & DUNLAVEY
Demand Based Program (DBP)_
BRAILSFORD & DUNLAVEY
RecommendationsScenario II – Sophomore Live-on Requirement & Sansom as College House
Institute Freshmen College & Upper-Class College House System– 2009 Freshmen in traditional-style houses
• Fisher-Hassenfeld, Hill, Kings Court / English, Riepe, Ware• Capacity: 2,349 beds 2006-07 Freshman Class Size: 2,385 students
– 2009 Creation of two university-wide College Houses• Gregory, Du Bois• College Houses that accommodate Freshmen through Senior Students
– 40 Freshmen in Du Bois / 40 Freshmen in Gregory
– 2010 Sophomores, Juniors, and Seniors in mixed-unit College Houses• Stouffer, Rodin, Harnwell, Harrison• Balance between Sophomore and Upper-Class students so that both groups
represent no less than 30% and no more than 70% of the House population
BRAILSFORD & DUNLAVEY
– 2010 Sansom is converted into a College House• Balance of Sophomore and Upper-Class Students
• No On-Campus Graduate Housing
– 2010 Sophomores Live-On Requirement• Approximately 85% of Sophomores are required to live on campus
– 2010 New College House is Developed• Balance of Sophomore and Upper-Class Students• Suggested configuration based on Demand:
– 140 Private Suite beds– 200 Three- or Four-Bedroom Apartment Private beds
RecommendationsScenario II – Sophomore Live-on Requirement & Sansom as College House
BRAILSFORD & DUNLAVEY
Capture Rates / Assignment Reconciliation
House Configuration
RecommendationsScenario I – Sophomore Live-on Requirement & Sansom as College House
BRAILSFORD & DUNLAVEY
Demand Based Program (DBP)_
BRAILSFORD & DUNLAVEY
BRAILSFORD & DUNLAVEY
Comprehensive Housing Market Analysis
DRAFT - Executive SummaryDecember, 2007