Which would you choose: the cramped quarters, thin mattresses, and crowded communal bathrooms of dormitory life or a new type of student housing with comfortable couches, a game room, fitness center, Wi-Fi in every room, flat-screen televisions and maybe even a theater?
If you selected the latter, you’re not alone. And colleges and hospitality veterans are joining forces to develop a product that’s likely to enjoy strong occupancy from the get-go by virtue of its ideal location; lifestyle amenities; and vast, underserved customer base.
Drawing upon proven platforms from the hospitality industry, CampusBrands Inc., is creating the first student housing franchise brand, the company announced on June 8 at the 31st Annual New York University International Hospitality Industry Investment Conference in New York. CampusBrands is developing off-campus student housing communities, called CampusCentre, through new construction and conversion of hotels and existing student housing properties near colleges and universities worldwide.
Offerings will range from affordable to upscale. With an aim to bring student housing into the 21st century, the Atlanta-based company has formed a strategic alliance with NYLO Hotels. The loft-style boutique hotel company will provide design expertise, including new-construction prototypes and guidelines for premium-class conversions with stylish upgrades.
“CampusBrands answers the call from a huge and largely overlooked market,” says Kevin Bradt, CEO, CampusBrands. Before founding the company, Bradt led multiple global hotel brands as a brand executive and division president at Choice Hotels International. He says he moved to student housing because of the solid fundamentals of this fast-growing, recession-resistant sector.
“Student housing is a multi-billion-dollar market,” Bradt points out. “With college enrollment booming, demand has soared, but supply hasn’t kept pace. Today, private companies like CampusBrands are stepping in to meet student housing needs.”
“The lodging and student housing sectors have many operational and construction design synergies,” he continues. “CampusBrands is offering a breakthrough approach that introduces a global brand with a marketing and operational platform that is similar to the hospitality industry but specific to student housing. With this platform, we can bring synergies from hospitality into the student housing marketplace and translate it into value for our residents and franchisees.”
According to the U.S. Department of Education, more than 11 million students live in off-campus housing in the United States annually. Demand is likely to remain strong. The Department reports university enrollment is expected to grow by 12 percent or more in the U.S. by 2013.
“Our goal is to become the premier brand and franchisor in this rapidly expanding, $40 billion, recession-resistant market,” Bradt says. “To this end, we’re delighted to work with NYLO,” he explains. “The brand’s innovative balance of contemporary design and favorable construction costs will address what students, parents and universities are looking for in housing, creating a strong competitive advantage for franchisees.”
“NYLO is pleased to design housing for tomorrow’s business travelers,” notes John Russell, CEO, NYLO Hotels. “I’ve known Kevin for years, dating back from our days together at Cendant. His drive and determination are second-to-none. Given his stellar track record in hospitality brand leadership and franchising, Kevin is the right person at the right time to transform this huge and promising market.”
Bright Future for Underperforming Hotels CampusBrands provides developers with repositioning strategies for their underperforming hotels. The hospitality industry has seen over-building in recent years, Bradt explains. Older lodgings still in the inventory can drag down the local market’s overall performance and the owner’s portfolio success.
“For owners with multiple properties in a single market, our strategy to reposition the underperforming property to a new asset class has two benefits. First, it helps rectify that underperforming property’s performance. Second, it helps boost occupancy for the remaining hotels by shifting the demand base,” he says.
“In many college towns, hotels are already being converted to student housing, but it’s being done in a slow, costly manner with no real on-going support,” he comments. “As a global company, CampusBrands will provide the developer with both a complete hotel conversion process and our global operational and marketing platform, so they can be successful in their new asset category.”
Global Brand Drives Return on Investment The scenario of too many students and too few housing options creates opportunities, but without a comprehensive program, developers could miss out on this potentially lucrative market, according to Bradt.
“Currently, the private student housing market is fragmented, with the largest players combined owning less than a 5 percent market share,” he explains. “Still, many independent operators are at a disadvantage, having limited marketing programs and operational support.
“The timing is right for a unified strategy made possible by a global franchise brand,” Bradt continues, “and CampusBrands is uniquely positioned to be the premier off-campus student housing company.”
CampusCentre residences – both newly constructed complexes and premium-class conversions with stylish NYLO makeovers – will address what students, parents and universities want in housing at an extremely advantageous cost to build, he points out.
“Additionally, CampusBrands will provide the tools for new entrants to reap the benefits of this asset class and for existing operators to compete in it more effectively,” he says. “Leveraging our global brand, franchisees will receive the marketing programs, training and operational support to succeed in this rapidly expanding market. Plus, CampusBrands’ ongoing market research with students and parents will help assure franchisees stay on top of the latest trends driving off-campus housing purchasing decisions.”
Head of the Class
Bradt describes his company as a student housing lifestyle brand. CampusCentre residences will feature new amenities, such as a game room, mini grocery store, social areas, fitness center, study lounge, eatery and expansive terrace.
“CampusCentre will not only provide housing that’s comfortable, safe and affordable,” Bradt says. “These communities will also be rich in lifestyle amenities, providing a place where students will gather to watch movies and sporting events, work out, play games, listen to music, eat, study and get together with friends. The communities will be a home-away-from-home, where young people can relax, have fun and form lasting relationships in a safe environment conducive to learning.”
Atlanta-based CampusBrands is a new global student housing brand company creating franchised off-campus student housing communities through new construction and conversions of hotels and existing student housing properties. Residences will range from affordable to upscale. These communities, called CampusCentre, feature bright, airy bedrooms and baths as well as common areas for studying, socializing, dining, working out, watching movies and sporting events, and more. Franchisees have the opportunity to reposition underperforming hotels or build new complexes and be part of this fast-growing niche in the real estate market. For more information, visit online at http://www.campusbrands.com or contact Kevin Bradt at 404.574.6010.
About NYLO Hotels
Atlanta-based NYLO Hotels offers a new class of hotels that combines the dynamic qualities of urban residential loft-style living with the best-of-the-industry features of leading hotel brands. NYLO features bright, spacious loft accommodations; state-of-the-art business center; high-tech gym; and stylish, 24-hour, healthy-alternative restaurant and bar. The brand caters to travelers seeking an energized alternative to the bland, one-size-fits-all experience typically found in mid-priced lodgings. The first NYLO made its debut in Dec. 2007 in Plano, Tex., in North Dallas. A second hotel, NYLO Providence/Warwick, opened in Sept. 2008, and a third, NYLO Dallas/Las Colinas, is on track to premier early in the summer 2009. For more information, visit http://www.nylohotels.com.