Strategies for Developing Affordable New Graduate Student Housing

The housing crisis experienced by graduate students across the country is a growing issue for many colleges and universities. Capstone has seen increased activity by many colleges and universities seeking opportunities and creative solutions in response to the need for more affordable housing options for graduate students and graduate students with families.  The effects of increasing housing costs and decreasing availabilities may also be impacting a college or university’s competitiveness in attracting the best and brightest graduate students, as expectations for affordable housing options on or near campus are being considered as part of a student’s graduate school selection.

From a development perspective the challenge in providing affordable housing to a graduate student population has always been that they are more mature students, who desire more privacy, and yet are the most price-sensitive.  With increasing development costs and the continued decrease in the supply of housing, now more than ever there is an acute need to explore creative approaches to the development of more affordable graduate student housing offerings at colleges and universities.

Below are three strategies that are proving effective in helping to overcome some of these challenges.

Efficient Programming of Space to Meet the Needs of Graduate Students

A continual focus on increasing design efficiencies within varying unit types and configurations has helped some Capstone projects increase densities within buildings, mitigate increasing development costs, and explore unit design solutions that in turn result in achieving varying rental rate price points for graduate students.

Working closely with UC Santa Cruz and its Graduate Student Association, we designed a combination of highly-efficient micro studio units, and creative “co-living” floor plans that provide much desired privacy and personal space along with a series of shared spaces tailored to the needs and specific lifestyle of graduate students. This approach resulted in an efficient design solution that helped to strike the balance between affordability and the creation of the type of community desired by the graduate students we are serving.

Evaluation of Prefabrication and Modular Design Options

Recent advancements and new companies within the prefabricated and modular space have prompted a revisit of these emerging building technologies in high-cost, urban markets to support and advance efforts to provide more affordable housing options for graduate students.  When pricing proves comparable or beneficial to site-built construction, enhanced quality in controlled environments, better cost predictability, and the potential for improved delivery schedules all make prefabrication and modular a good fit for graduate housing — in the right market.

Investigate State and Local Development Incentives

Often times the effective use of available development incentives or concessions is what can make or break a project, particularly when developing housing off-campus.  Potential opportunities to increase density, reduce development costs, reduce taxes, streamline the regulatory process and development approvals are all critical components that can help reduce costs and get projects across the finish line.  In California, the Density Bonus Law was recently amended to include eligible student housing developments that meet specific affordability requirements.  The Density Bonus Law goes beyond just the density bonus itself and provides other incentives and concessions to help make a graduate housing project more economically feasible.  Likewise, other states and local jurisdictions have implemented similar development incentives aimed to encourage the development of more affordable housing and are worth further investigation in the right market.  In some cases, affordable housing incentives are more applicable to graduate housing developments (as opposed to undergraduate housing developments) as eligibility for affordable housing may be more attainable by graduate students as they are often financially independent from their parents and earn limited income.

Developing affordable new graduate housing is a challenging task, but affordable and accessible graduate housing can be achieved with a team committed to exploring all the options available to mitigate the development challenges and address the critical needs of graduate student housing.

Author: Chad Izmirian, Senior Vice President