Student housing climbs the sky in center city

The all-inclusive student-housing model appears to be taking Springfield by storm.

With enrollment at Missouri State University’s Springfield campus eclipsing 20,000 in fall 2011 – up 8.5 percent since 2005 – area developers have responded to what they say is a pool of students anxious for quality housing near campus.   

Five student-housing apartment complexes are climbing to the sky around center city as developers rush to open ahead of the 2012–13 fall semester. Projects under way are Beacon Park Apartments, Bear Village, Deep Elm, The Jefferson and University Suites. These come just one year after The Monroe and Beacon Commons were completed to serve MSU students. A sixth project, which would be developed by MSU, is planned just north of Kentwood Hall on East Walnut Street.

The multimillion-dollar developments are the work of three development companies: Bryan Properties Inc., Miller-O’Reilly Co. Inc. and Beacon Student Housing.

Bryan Magers of Bryan Properties is developing the 72-unit University Suites Apartments on the campus of Drury University and the 9.5-acre, $30 million Bear Village complex, just west of MSU. Phase I of the off-campus development near MSU is expected to wrap July 20, and Magers said he’s already leased 65 of its 98 bedrooms.

Similar to other off-campus developments under way, Bear Village is leasing fully furnished pads by the bedroom, with utilities paid, for about $600 per month. Magers said he expected demand to be strong, and he hasn’t been disappointed, so far. In fact, he said Phase II would start soon and should be complete by August 2013.

He said Bryan Properties has been collecting properties near MSU for more than 25 years as part of his dream to build a community-oriented student-housing district.

“We knew that there had been a demand even a few years earlier, but we really couldn’t begin because there were some key pieces of property we were still trying to buy,” Magers said.

He said he’s not worried about other developments because those efforts could solidify his company’s work by creating a vibrant atmosphere. “Students want to be close to the campus, but they just haven’t had the quality housing to get them to stay,” Magers said.

Miller-O’Reilly co-owner Matt Miller said he was inspired to build modern student housing after visiting his daughter a few years ago when she attended Arizona State University. She had lived in all-inclusive off-campus apartments that were leased by the bed – unlike anything he had seen in Springfield.

“It was the first time I had seen that model before, and interestingly enough, the model is all over. We are not inventing anything here by any means,” said Miller, whose company splashed onto the MSU campus last year with The Monroe and its single-bed leases.

Miller, who owns downtown loft apartments and townhouses such as Walnut Alley and Six23 Condos, got started in the upscale student-housing model with Eko Park at West Catalpa Road and Kansas Expressway. He soon followed with Walnut Quads on East Walnut Street before he purchased land for The Monroe from Assemblies of God. He said he worked with MSU to be a good neighbor but does not have any agreement in place to provide student housing with the university.

Build LLC President Ron Barrett said his company has managed construction on seven student housing projects in the city and has plans for more.

This fall, Barrett said Build is scheduled to begin Eko Park’s second phase, which would add 96 units to the 114-unit eco-friendly development in west Springfield.

The student-focused construction has helped grow Build’s revenue by more than 25 percent each of the last two years, generating roughly $18 million for the company, Barrett said. Multifamily construction now represents about one-fourth of total revenue.

“We’ve kind of singled out a little niche here. Student housing is in major-league demand, so we’ve got a couple of developers in Colorado, Wisconsin, Illinois and even Arizona that are more than considering student housing projects. They are working through the steps to get them moving,” Barrett said.

He said the local projects have typically been smaller than the high-rises he’s seen in other parts of the country. “They’re not building these 10- to 15-story high-rise structures like Sunvilla Towers. They are doing a more boutique style that they can feel more comfortable with. They say, ‘We know we can put 120 students in these units versus worrying about 800 students,’” Barrett said.

Tim Roth, a commercial real estate agent with Sperry Van Ness/Rankin Co. and representative owner of Beacon Student Housing, said work with developers from Colorado led to his involvement – the 48-bedroom Beacon Commons and the $2.8 million Beacon Park Apartments under way with a range of bedroom options. Roth’s out-of-state partners have backed a number of student-housing developments and were looking for new markets that could support modern apartments.

“The reason they had targeted Springfield was because most universities the size of (Missouri State) have really large, new modern student housing – similar to what is being built, but on a larger scale,” Roth said.  

Roth said he thinks Springfield had been lagging in the number of options it had to offer MSU students, in particular. “I think we’re playing catch-up,” he said.

Mark Miller, director of media relations for Drury University, said school officials chose to work with Magers on University Suites as a way to meet a long-term need for student housing without taking on new debt.

“We get our dormitories built, and he gets a development with a lease on it for 25 years,” Miller said.

According to the agreement, Drury will manage the apartment property for up to 25 years while Magers collects rents and pays the debt service. At the end of the 25-year period, ownership of the property transfers to the school, though Drury has an option to take ownership and loan-service payments after 15 years.

Only Magers has such an agreement among the five projects currently being erected in Springfield.

Drury’s Miller said the new complex, which features a renovated Rose O’Neill house as a community center and free Wi-Fi, a flat-screen TV, furniture and a washer and dryer in each four-bedroom unit, is a way to draw upper-classmen back to campus. He said 57 percent of its Springfield students live on campus.

“This is what students want,” Miller said. “We have a lot of students who live off campus, and part of this is to bring them back into the fold.”[[In-content Ad]]