SUNDAY EDITION | Thousands more high-end apartment beds planned near University of Louisville
In 2010, the Bellamy opened next to the Province at S. 7th Street and W. Shipp Avenue. Cardinal Towne (555 beds), a four-story building encompassing the block between 3rd and 4th streets on Cardinal Boulevard, opened the following year. Finally, the Grove opened last year at 2501 S. 4th Street.
None of the apartments are owned or financed by the university, but the developers have affiliation agreements which allow them to brand their apartments as official U of L housing and to recruit students on campus and at U of L events.
In exchange, U of L receives annual payments ranging from about $15,000 (Cardinal Towne) to $47,000 (The Province), according to the affiliation agreements, obtained under the Kentucky Open Records Act.
The agreements do not require that the apartments rent only to U of L students, and at least three of the complexes have students from other colleges like Jefferson Community & Technical and Spalding University.
Besides the Retreat and the Clubhouse – both of which will open this fall – two more complexes are in the works:
- The Nine @ Louisville, a “luxury, boutique” six-story building at S. Floyd St. and E. Brandeis Ave., was first planned to open this fall, but now the website of the 908 Development Group in Tampa, Fla. indicates it is planned for the fall of 2016. It could house 385 students. A 908 Development executive did not return a call for comment.
- American Campus Communities, the Austin firm that bought the Province and Cardinal Towne, confirmed it's “working with the university” on a development called The Village. As WDRB reported in November, the project apparently involves moving the Taco Bell at Brook and Bloom streets. Kathleen Smith, chief of staff to U of L President Jim Ramsey, told the Metro Council on Jan. 5 that the Village would have about 650 beds.
U of L: campus living leads to academic gains
Staten, the university housing director, said because students who live on campus are more engaged, the shift to a more residential campus is one reason U of L has raised the percentage of students who finish their degrees within six years from 30 percent in 1998 to 52 percent in 2012.
The university is also recruiting higher-caliber students, with the average ACT score of entering freshmen rising from 21.4 to 25 during that period.
With a freshman class that has grown every year since 2009, the three-year-old campus living mandate means there is very little dorm space for upperclassmen, Staten said.
“It's supply and demand, and right now the demand -- it's extremely high,” said Katherine Counts, a sophomore from Georgetown, Ky., who said she would prefer to stay on campus, but doubts there will be space for her next year. Earlier this month, Counts signed a lease with some friends at the Retreat.
Yet, the growing freshmen class and on-campus living requirement alone aren't enough to explain all the proposed student apartments in the works.
“I think what the new owners are banking on, as more students live on campus, as we have these wonderful athletic venues on campus and other resources and the libraries… that more students will want to live within walking distance of that,” Staten said.
She added that the complexes offer upperclassmen a degree of “independent living” but in an environment in which they're surrounded by peers and “still feel connected to campus.”
Though he wanted more space than he could afford at the Bellamy, Yazell said “the social aspect of it was definitely worth it.” Whether it was hanging by the pool or playing ping-pong in the lounge, “it was a ton of fun.”
Chad Broderick, a vice president at Chicago-based John Buck Co. – an investor in the Clubhouse – said the university remains “underserved” in “purpose-built” student housing, and that's partly because of U of L's growing national visibility from the success of its sports programs.
“People outside of Kentucky are looking at the University of Louisville as a viable option for their higher education,” Broderick said.
Broderick said the Clubhouse is on track to lease all 758 beds by the fall, but declined to provide specific numbers. The Clubhouse's most expensive unit -- a $920 per month one-bedroom -- is sold out, according to its website.
Meanwhile early leasing is also on track at the Retreat, with some of the property's 18 types of floor plans already sold out, said Teresa Crum of Memphis-based EdR, which has joined with Landmark Properties of Athens, Ga. in the development.
In a written response to questions, American Campus Communities said even with dorms and the off-campus apartment buildings, there are still about 16,500 U of L students that are “still in need of modern, quality housing that is conducive to academic success.” (The company was referring to U of L's total enrollment of more than 22,000, which includes part-time undergraduates and graduate programs like the medical school and law school).
U of L is also part of a national trend with developers like American Campus, Campus Crest and EdR placing high-end apartment communities near bigger college campuses.
There are versions of the Retreat, for example, at the University of Mississippi, Penn State and Central Florida, Crum said.
Campus Crest has 47 complexes called the Grove in 23 states, with a “prototypical building design” the company has constructed more than 700 times, according to Campus Crest's most recent quarterly report to investors.
Cost includes a lot
While rents of $600 to $950 a month per bed might seem expensive, Staten noted that the student apartments include a lot of things that tenants would otherwise pay for separately.
What's included with the rent varies among the complexes, but it's generally utilities such as water and electricity (up to a cap), cable TV, wireless Internet, furniture such as full beds, couches and desks (sometimes with a monthly upcharge), and washer-dryers. Some include common-area TVs.
“If we were to do an apples-to-apples comparison, we would probably find that they're not much more expensive than what you would get in a newer apartment somewhere else,” Staten said.
In addition to saving parents from lugging mattresses and couches in and out of the units, the developments lease the beds individually – so if one roommate in a four-bedroom unit doesn't pay the rent, the other three aren't responsible.
“You don't want to have worry about people forgetting their rent,” said Counts, the sophomore who is “very excited” about living at the Retreat next year.
Besides pools, fitness centers are another typical perk, though the university also collects a $98-per-semester fee from all fulltime students to pay for the new student recreation center on S. 4th Street.
The Retreat appears to be the poshest complex with a sauna and indoor basketball court, and EdR's Crum said the company is only delivering the perks that students want.
“They want fun things to do – and place to live and mingle and hang out and (they say) ‘We don't have to go to the gym because we have an onsite gym,'” she said.
Students are generally able to use education loans to pay rents at the private facilities, Staten said, and Bellamy manager Haughton said “most people at least use some portion of loans” to pay their rent.
American Campus Communities said it doesn't track what percentage of its rental income nationally comes from student debt. But in a statement, the company's chief investment officer William Talbot said 98 percent of its leases are also signed by a guarantor, “indicating that the students are either receiving support from a parent or guardian or that a parent or guardian is willing to provide a financial backstop.”
(Another typical requirement is that a parent or other adult guarantee the lease, or the student puts down a hefty deposit).
Talbot said the fact that buildings like the Province and Cardinal Towne are nearly 100 percent leased shows a high-end, furnished apartment within walking distance of the university is an “attractive value proposition” for students and their parents.
Counts, the sophomore, said the main issue is that U of L doesn't have enough on-campus housing for second- and third-year students.
Though plans are preliminary, U of L is looking at demolishing three existing dorms near Stansbury Park and replacing them with a 536-bed complex meant for upperclassmen by the fall of 2016.
Staten said the project would give “more flexibility” to students who want to stay on campus.
CORRECTION: A previous version of this story misstated the development in which the John Buck Co. is an investor. It is the Clubhouse, not the Retreat.
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