16 Nov Shippensburg University Kicks Off Student Housing Development
November 16, 2011
By Dees Stribling, Contributing Editor
Shippensburg, Pa.—Shippensburg University Student Services Inc. (SUSSI) and Philadelphia-based Campus Apartments have broken ground on the first phase of development to upgrade the university’s stock of on-campus residences. Costing an estimated $200 million, the three-phase project is slated for completion by summer 2015, with the first phase expected to be finished by January 2013.
The $70 million first phase will include the construction of three residential buildings to accommodate 924 students. The facilities will include semi-suite and full-suite floor plans, multipurpose programming areas and study and social lounges. One of the buildings will also include a 13,000-square-foot wellness center, and another will be a new home for the university’s Honors Program.
As the project owner, the nonprofit SUSSI partnered with Campus Apartments to develop and finance the project, whose goal is to improve the quality of on-campus housing at the university (and thus help improve the school’s competitiveness in recruiting students). To finance the project’s first phase, Campus Apartments employed bond financing.
“Through our collaboration with RBC Capital, Campus Apartments was able to close favorable tax-exempt bond financing of about $70 million for the first phase of this project,” Dan Bernstein, senior vice president and chief investment officer at Campus Apartments, tells MHN. “The financial community recognized the experience of the development team, the commitment of the university and the underlying strength of this deal, which resulted in broad investment appeal for the bond issue and a favorable rate. As a result, the university will be able to preserve capital for other core university initiatives.”
Considering the fundamentals of the student housing industry, it’s little wonder that investors took a liking to the project’s bonds. According to the National Multi Housing Council, the demand is there: An analysis of 56 U.S. universities shows an average growth rate of 20 percent for freshman applications for the fall of 2010 compared to fall 2008. Twenty-three of the schools surveyed reported a gain of 25 percent or more; only four schools showed a decrease in enrollment.