How Student Housing Developers Can Avoid Late Deliveries

Pentarisk’s Judson King Stewart, at right
Judson Stewart | Facebook

Pentarisk’s Judson King Stewart, above right, specializes in insurance risk management for student housing projects. So it made sense to kick off the panel he moderated at Bisnow’s Annual Student Housing summit with a sobering rundown of the sector’s late-delivery stats. There were 47,800 beds scheduled for delivery in 2015, “and last I checked, 12,400 were late,” Judson said. In 2016, 47,400 beds are slated for delivery, and 2,100 have been late so far. It’s a big risk management issue, he noted, so how are developers working to mitigate that risk and deliver projects "where everyone makes money"?

EdR Trust's GrandMarc at the Corner student housing project at University of Virginia.
EdR Trust

“Choose partners wisely,” advised EdR Trust VP Jeffrey Resetco, whose portfolio includes GrandMarc at the Corner at the University of Virginia, above. Also factor in costs—taxes, plus time required for approvals /consultations. Architect Brian O’Connor, principal with CUBE 3 Studio (designer of the Northeastern University project seen below), echoed that sentiment. “Having a partnership that works”—a developer who lets the design process happen “the way it should”—is key. Prefabricated wall panels and pod bathrooms help create efficiencies, noted DPR Construction’s Brian Kent, as does engaging the general contractor early on.

Cube 3's student housing project at Northeastern University
Cube 3

Virtus Real Estate Capital acquisitions director Kevin White underscored the need for due diligence. “We’re approached with new projects all the time,” he said, “and one of our first questions is, ‘Can we see the market study?’” Also, who is the architect, engineer, GC, development partner and project manager; and who is the market and how will it be catered to? All this detail needs to be outlined at the outset. “If we’re going to spend $50M to develop a project, we want to have some conviction around if it’s going to work or not.”

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