Report on Student Housing
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REAL ESTATE ADVISORY SERVICES - STUDENT HOUSING (PHASE 1A) PREPARED FOR LOS ANGELES COMMUNITY COLLEGE DISTRICT FEBRUARY 2017 DRAFT REPORT INSPIRE. EMPOWER. ADVANCE. INSPIRE. EMPOWER. ADVANCE. [email protected] PROGRAMMANAGERS.COM REAL ESTATE ADVISORY S E R V I C E S – STUDENT HOUSING | L O S ANGELES COMMUNITY CO LLEGE DISTRICT PREFACE WORK PLAN In October 2016, the Los Angeles Community College District (“LACCD” or B&D’s approach to completing Phase 1A of the Plan required active the “District”) engaged Brailsford & Dunlavey (“B&D”) to complete the first coordination with district staff and Presidents from each of the four phase of Real Estate Advisory Services for Student Housing (Phase 1A). colleges. Additional coordination with various Vice Presidents of Student A detailed Student Housing Demand Analysis (the “Analysis” or the “Plan”) Services at each college was also utilized in order to adequately schedule was performed during the Fall (2016) and Winter (2017). The purpose of focus groups during the months of December (2016) and January (2017). the Plan was to understand overall housing demand from students for living in a student housing development on their campus. The following LACCD The complete work plan includes the following tasks: campuses were identified by the Board of Trustees for evaluations: A visioning session with campus presidents to understand Los Angeles City College (“City”), opportunities and challenges of adding student housing on Los Angeles Pierce College (“Pierce”), 1 campus; Los Angeles Harbor College (“Harbor”), and . West Los Angeles College (“West”). Focus group and stakeholder interviews to qualitatively understand student preferences for housing, rental rate VANCE sensitivities, and general off-campus living experiences; The findings contained herein represent the professional opinions of B&D’s personnel based on assumptions and conditions detailed in this report. An off-campus housing market analysis to assess the local B&D has conducted research using both primary and secondary housing market and typical price points near each of the four information sources which were deemed reliable, but whose accuracy campuses; cannot be guaranteed. A student survey to quantify preferences for housing amenities, unit types, and demand; INSPIRE. EMPOWER. AD The project team was comprised of the following individuals: A demand analysis to quantify bed demand for a variety of unit types for a housing project at each of the four campuses; Y Matthew Bohannon, Regional Vice President data used for the demand analysis was collected from the Andrew Perez, Project Manager student survey; Cindy Doan, Project Analyst BRAILSFORD & DUNLAVE LOS ANGELES COMMUNIT Y COLLEGE DISTRICT TABLE OF CONTENTS Recommendations & Considerations…...……………………………………………………………………………………………….3 Market Analysis…………………………………………………………………………………………….…………………………………5 Focus Groups & Stakeholder Interviews.…………………………………………………………….5 Off-Campus Market Analysis……………………….……………………………………………….6 2 Student Survey Analysis…………………………………………………………………………….8 . VANCE Demand Analysis….…….…………………………………………………………………………………………………………………12 EXHIBITS INSPIRE. EMPOWER. AD A. Survey Data Report & Comments Y B. Off-campus Analysis C. Demand-Based Programming Results BRAILSFORD & DUNLAVE REAL ESTATE ADVISORY S E R V I C E S – STUDENT HOUSING | L O S ANGELES COMMUNITY CO LLEGE DISTRICT RECOMMENDATIONS & CONSIDERATIONS TOTAL STUDENT HOUSING DEMAND BY CAMPUS (ALL AGE GROUPS) Harbor College West L.A. College Pierce College L.A. City College Traditional Student Housing As LACCD continues to assess the opportunity of providing student Traditional 66 109 190 177 Semi-Suite 45 65 64 97 housing on the four campuses evaluated in this Analysis, the following Full-Suite 51 48 92 96 Total: 162 222 346 370 recommendations and considerations are provided for Phase 1A of the Apartment Student Housing Real Estate Advisory Services for Student Housing across the District. Studio 15 30 48 67 1-Bedroom / 1-Bathroom 8 24 87 98 2-Bedroom / 1-Bathroom 26 49 71 94 Our approach to the decision for selecting the three colleges can be 4-Bedroom / 2-Bathroom 20 24 98 11 summarized in the B&D Decision Matrix below which utilizes the Market Total: 69 127 304 270 Total Bed Demand by Campus: 231 349 650 640 Analysis, Demand Analysis, and institutional or district-wide direction FIGURE 1: B&D Demand-Based Program Model Projections (All Age Groups) for pursuing a project. Additionally, based on the data, Brailsford & Dunlavey recommends 3 Within the overall Market Analysis, City, West, and Pierce received excluding Harbor College from Phase 1B due to insufficient demand . qualitative and quantitative support from students. A target market was from participants in the survey. Students overall and those within the developed to determine which students would be most likely to afford international capture rate analysis did not provide sufficient interest to VANCE to live on campus. The target market included respondents who met justify the development of student housing at Harbor College. the following criteria: (1) are full-time students; (2) indicated they were interested in living on campus; (3) currently living off campus and are Although an extensive Demand Analysis was not completed for the renting a room, apartment or house; and (4) are currently paying rent international student population, a capture rate analysis conservatively of $500 or more per month within the off-campus market. These projected how many international students could be included within a students were used as a filter to project demand for the larger likely target market. Using Fall 2016 enrollment data of students with enrollment population of each campus, including an additional capture an F-1 or M-1 Visa, the analysis determined that approximately 60% of INSPIRE. EMPOWER. AD rate analysis related to international students. the 18-24 year olds, 30% of 25-29 year olds, 15% of 30-34 year olds, 10% of 35-39 year olds, and 5% of 40 year olds or above could be Y Based on the findings and demand data from the analysis, Brailsford & captured from the international populaiton. This capture rate was Dunlavey recommends the following three campuses move forward based on how international students responded to survey questions into the subsequent phase of financial feasibility assessments (Phase about their interest in housing and their ability to afford the unit types 1B): tested by B&D. Los Angeles City College, Los Angeles Pierce College, and The capture rate analysis determined the international student target West Los Angeles College. market by campus could be the following: 199 of the 390 total BRAILSFORD & DUNLAVE LOS ANGELES COMMUNIT Y COLLEGE DISTRICT international population at West, 170 of the 366 international students Verification on the availability of land at each campus to support at City, and 131 of the 247 international population at Pierce. Harbor the concept of developing student housing. College could potentially capture 67 of its total international population Understanding of the District’s interest in providing additional (133 students) but did not receive enough overall demand in the services, such as dining and retail, to support a residential campus. Demand Analysis to justify moving forward with the development of Further clarification on the will of the district and each campus to pursue student housing. student housing. B&D DECISION MATRIX - STUDENT HOUSING ANALYSIS Additionally, East L.A., West L.A., and L.A. City Colleges had the Harbor College West L.A. College Pierce College L.A. City College highest likely target markets among international students. If Traditional Housing Demand N Y Y Y Apartment Housing Demand N N Y Y international housing aligns with the mission of the District and each Total Student Demand N Y Y Y Potential International Capture N Y Y Y campus, B&D recommends that a more through Demand Analysis be Focus Group Support Y Y Y Y Established Vision for Each Campus NMI NMI NMI NMI completed to better understand this sub-group’s interest in housing. Mission Alignment with Each Campus NMI NMI NMI NMI Land Availability NMI NMI NMI NMI 4 Additional Support Services for Housing NMI NMI NMI NMI Demand itself does not determine viability of a project and other factors Institutional / District Will NMI NMI NMI NMI . on a campus-by-campus basis play an integral role into the success of Number of 'N': 4 1 0 0 Y: Yes; N: No; NMI: Need More Information student housing at an institution. Some of these factors may require VANCE further information by the Board of Trustees prior to initiating Phase 1B. FIGURE 2: B&D Decision Matrix Those factors are highlighted in the B&D Decision Matrix as items that Need More Information (“NMI”) while other fulfilled factors from the Market and Demand Analyses are identified with a Yes (“Y”) or No (“N”). The amount of “No” designations on the chart ultimately allows B&D to identify whether to move forward with a particular campus or not. Although more information is needed for some of the factors, INSPIRE. EMPOWER. AD campuses with three or more “No” designations were given a no-go recommendation as a part of Phase 1A. The following factors are Y recommended for further clarification prior to initiating Phase 1B: Determination of the District’s primary vision-drivers for student housing at each of the three campuses with demand. Confirmation the concept of student housing aligns with the mission at each campus. BRAILSFORD & DUNLAVE REAL ESTATE ADVISORY S E R V I C E S – STUDENT HOUSING | L O S ANGELES COMMUNITY CO LLEGE DISTRICT MARKET ANALYSIS SUMMARY OF FOCUS GROUPS B&D conducted a Market Analysis that consisted of focus groups, Renters found it difficult to secure convenient and affordable housing stakeholder interviews, an evaluation of the off-campus housing market, options near their primary campus. and a student survey for each of the four LACCD colleges selected for Phase 1A. Below is a summary of the Market Analysis as well as additional Overall, focus group participants described the off-campus market as data points supporting the overall themes heard throughout the Analysis.