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Philly Student Housing Expecting 'Full Reopening' After Penn, Drexel Announcements

While much of commercial real estate is still waiting for the long-term effects of the coronavirus pandemic to become more clear, student housing has seemingly been given the green light.

On-campus residence halls overlooking a quadrangle on the University of Pennsylvania campus.

On March 15, Drexel University President John Fry announced that barring a major reversal in vaccination trends and Covid-19 case numbers, the school will be resuming full on-campus residential and educational activities. The following day, University of Pennsylvania leadership followed suit.

“We will be ramping up our in-person and hybrid classes through the summer,” Fry said in the announcement. “We expect that, by the fall, every student will be able to have face-to-face learning experiences, although some hybrid classes and other operational modifications may remain based on public health guidance.”

Temple University President Richard Englert gave a similar, if more cautious, announcement on March 1 that the North Philly school is “planning for a fall semester that is primarily in person with a substantial number of students returning to campus.”

A similar story is playing out across the country, Campus Apartments CEO David Adelman told Bisnow, adding that Temple’s tempered enthusiasm “sounds like a hedge.”

“We’re in about 18 states, and every day we’re hearing announcements about schools reopening in the fall,” Adelman said. “Everyone anticipates a full reopening.”

Penn will even be increasing the portion of its students who will be housed on-campus, finally putting into place a requirement for all sophomores, not just first-year students, to live on campus that was supposed to have taken effect last year, Penn Vice President for Facilities and Real Estate Anne Papageorge told Bisnow

“We hadn’t implemented it yet because we’re finishing up a new college house of around 650 beds this summer,” Papageorge said. “That will give us the capacity to house sophomores and freshmen without displacing juniors and seniors who want to remain on campus.”

A representative from Drexel declined to comment on the school’s reopening plan, while representatives from Temple didn't respond to requests for comment by press time. Papageorge added that construction on the new residential facility at the corner of 40th and Walnut streets has recovered the lost time from brief construction delays last spring and is on track to meet its initially planned completion date in May.

Campus Apartments CEO David Adelman at a 2013 Bisnow event.

The immediate future for Philly's biggest universities holds the promise of the gradual reopening of campus facilities like dining, athletics and academic departments while everyone involved watches case counts and vaccination numbers.

As these announcements have come before many high school seniors have officially decided on their colleges, the question of how many students will accept schools’ invitations back to campus remains unsettled for now. Penn is preparing for higher-than-expected enrollment from new applicants or those who took a gap year as their own high school careers ended remotely by lining up master lease arrangements with some off-campus buildings where Penn has a 49% ownership stake, Papageorge said.

“We have a little flexibility if there’s more interest, but we’re also experiencing a little more softness; there’s 10-15% more vacancy [in our off-campus properties] than we normally have at this time of year,” Papageorge said.

After setting aside one of its “college houses,” as Penn calls its on-campus residential buildings, for quarantining Covid-positive students over the past year, the college is still deciding whether one of those master-leased blocks will be utilized instead in the fall, or if a designated quarantine space will be needed at all, Papageorge said.

Many students were undoubtedly waiting for some form of official guidance before committing to a living situation for the upcoming school year. Campus Apartments has seen a rush of applicants in the days since Penn and Drexel’s announcements, Adelman said.

“Normally our pre-leasing starts before winter break, and it was much slower than in years past,” Adelman said. “But since Penn’s announcement, everyone has woken up to the fact that they’ll definitely need housing for the fall.”

Off-campus student housing has been, and may continue to be, a beneficiary of pandemic-related disruptions. Philadelphia has been more restrictive in general with its health and safety protocols than many parts of the U.S., but many students either couldn’t or wouldn’t return to their parents’ homes, leaving off-campus housing as the only option. In the case of Penn, rising case numbers in the lead-up to 2020’s fall semester led to a quick reversal of a previous decision to reopen on-campus learning, spiking demand for move-in-ready housing for students already in Philly who had to pivot quickly.

FMC Tower in Philadelphia's University City, seen in November 2020 from the Schuylkill Expressway.

“We had quite a number of undergrads who found themselves in a situation where housing wasn’t going to be available with limited notice,” AKA University City Managing Director Evan O’Donnell said. “And it was understandable how it happened, but still challenging, so a number of undergraduates moved into our building.”

The University City location of flexible-stay, furnished apartment provider AKA is situated within the trophy-class FMC Tower on the eastern edge of the neighborhood, so it wasn’t a realistic financial option for the vast majority of Penn and Drexel students. But Campus Apartments, which rents units at various price points to mostly Penn students, still had an occupancy rate of between 60% and 65% throughout the fall — a hair below its nationwide average of 65-% to 70%, Adelman said.

Travel restrictions or concerns about transmission to family members kept some students in town, including the 500 or so international students that never left Penn’s on-campus housing in the spring, Papageorge said. For many that came back to Philly in the fall even without in-person classes, a desire to maintain independence and remain among peers is what drew them.

“Kids might have gone home in March and April of last year through the end of [spring] classes, and anecdotally, living with their parents again for that long is not what these students wanted to do,” Adelman said.

After case numbers declined significantly following a post-Jan. 1 bump, Drexel and Temple both gradually phased back on-campus residency while keeping most classes online. Penn also opted for mostly online classes and brought students back to on-campus housing with one resident per room, amounting to roughly 50% occupancy, Papageorge said.

Once Penn's new residence hall is finished, it will have just over 7,100 beds on campus and expects to fill all of them, even in rooms with two or more beds. Though Papageorge declined to use the term “mandate” to describe the school's stance toward first- and second-year students living on campus, as of now there is no plan to make exceptions for students (or their families) who may remain uncomfortable with such proximity.

Among the off-campus set, that discomfort has already been evident in decision-making from parents setting up their children's residential plans, O'Donnell said. Penn's quick 180 on in-person learning last fall also has some families looking to avoid depending on the university for housing, lest they be burned again.

“Even if the students aren’t necessarily sensitive to it, for parents it’s important to control the environment and have the assurance of having a property that won’t be restricted or closed, or that will dictate housing timelines because of challenges in the marketplace,” O'Donnell said.