CSU growth plans will put pressure on housing
The university plans to add 1,000 of its own new beds in the next few years but that number will barely put a dent in the student-housing crunch.
According to the Fort Collins Student Housing Task Force, approximately 15,000 beds will need to be added over the next decade to accommodate overall population growth in the city. That figures includes an enrollment increase of roughly 7,500 students expected by the university.
At the moment, 30 percent of all residential units in Fort Collins are multi-family. Within that universe, there are 57 complexes offering 12,077 bedrooms available to students.
Combined with the eventual 6,300 beds planned for campus, there will be a total of 18,377 beds available to students in developments on and off-campus. As of this past fall, approximately 27,500 students were enrolled at CSU. Enrollment is expected to swell to 35,000 over the next 10 years.
At least some of the new units are likely to go up as close to CSU as possible.
Vacancy rates have already bottomed out at 1.2 percent in the area of town surrounding the campus, and 80 percent of students surveyed by the city said being within walking or biking distance from CSU was the most important factor to them when choosing a place to live.
The city's "3-unrelated" ordinance – which prevents more than three unrelated people from living together – aggravates the problem. The city, however, has no plans to consider amending the ordinance, according to Beth Sowder, neighborhood services manager for the city.
The growing shortage will put pressure on students – and rents.
Paul Hunter, managing broker and Kevco Real Estate, which specializes in student housing, said students will need to start looking sooner for a place to live to ensure they secure an apartment.
Among the properties managed by his brokerage, vacancy rates have been at zero by Aug. 1 for the last four years, according to Hunter. Looking ahead, he expects that his properties will fill up even sooner in years to come.
Not surprisingly, affordability is the only consideration that ranked higher than location on the city's survey, with 94 percent of students surveyed saying that the price of a rental unit was the most important factor.
That's going to be a problem, too.
With demand rising, housing near campus will become less and less affordable, Hunter said. Rents farther out, Hunter said, also are likely to rise.
Average rent in the northwest portion of Fort Collins, the neighborhood surrounding campus, was $943 per month in the fourth quarter of 2011, according to the Division of Housing.
Stuart MacMillan, a longtime community leader and former president and CEO of Everitt-MacMillan Commercial, said the coming development will likely not occur in an even manner.
The more likely scenario is that development will pick up quickly, resulting in an oversupply for a time, then CSU's enrollment will increase and demand will catch up again.
Because the real estate and construction markets have been depressed, developers and builders will rush to fill the demand created by the promised influx of students.
MacMillan, however, predicted the majority of new projects will be built by larger companies from outside the Northern Colorado market.
The two largest student housing projects currently under way are both the product of companies from other markets. The Grove is being built by Campus Crest, headquartered in Charlotte, N.C., and The Commons is a project of Alabama-based Capstone Development Corp. The two projects combined will create housing for 1,282 CSU students.
The city, CSU and others will have more than economics to consider.
Student housing proposals tend to generate some sort of contention, typically from neighborhoods surrounding the sites of potential developments.
For example, the Grove took more than a year to pass the city's planning and zoning board, after homeowners associations took issue with land-use code compliance, environmental standards and the involvement of developer Campus Crest in various litigations.
Ultimately, Campus Crest worked with CSU's Institute for the Build Environment to make the proposed development more environmentally friendly, and the plans were retooled, moving the buildings further away from a wetland area and leaving 300 feet between The Grove and residential subdivisions to the north.
In the end, the resistance by the neighbors created a better project, according to those involved, including Fort Collins landscape architect and Grove site designer Linda Ripley of Ripley Designs Inc.
"Despite how contentious the process has been to date, the project is better for it," she told the Business Report last June. "Pushback from well-meaning neighbors caused Campus Crest to think more about sustainability building issues and they have changed their building prototype as a result."
For students in need of a place to live, none of that happened quickly enough.
More breaking news...
Colorado ranks fourth in job creation
CU study links frack-waste wells, quakes
Madwire closes on $5.5 million funding round
On the Job