University of Louisville Residence Hall Renewal Master Plan

University of Louisville

Residence Hall Renewal Master Plan

September 14, 2005

– Vision

– Market Analysis

– Operations Review

– Facility Assessment and Plan

– Implementation Plan

University of Louisville Residence Hall Renewal Master Plan

K. Norman Berry Associates Architects PLLC

ANDERSON STRICKLER, LLC

Residence Hall Renewal

Master Plan Assumptions

• University wants the residence halls to be a recruitment advantage

• University wants the residential experience to increase student campus engagement and academic success

• University wants to enrich campus life through increased on campus student housing capacity

• Living on campus at U of L improves student retention as shown in other national and institutional research




Visioning the Future

• H&RL is integral to the campus community for student retention and satisfaction, leadership development and civic engagement and most importantly, support students’ academic success

• All residential housing on Belknap and Health Science campuses are seamlessly by our University HRL Team





• Students are living and learning on campuses 2900 in single, double, suite, and apartment style housing

• A major facility renovation project funding and beginning with a completion goal of 2014

• Utilizing a combination of full-time/part-time university staff and outsourced vendor staff to provide the services necessary to maintain the halls





• Providing contemporary, progressive technological services for residents and prospective students





• Provide focused living learning communities for first year students, honors students and students interested in leadership development

• Sustaining active partnerships with the College of Arts and Sciences, The Speed School, and the Southern

Police Institute resulting in new living learning centers for these schools’ students





• Our facilities will be updated to provide an amenitydriven, consumer-oriented residential experience while remaining affordable

• Our facility environments will provide space that encourages engagement and academic success

• Students living on campus will gain a stronger connection to the overall university community




1998

2005

2011

Capacity Growth

RETURNING

1582

DEDICATED

FIRST YEAR

600

2182 ON-CAMPUS

2182 TOTAL CAPACITY

2605 ON-CAMPUS 2239 919

3158 TOTAL CAPACITY

981 2956 ON-CAMPUS

3456 TOTAL

CAPACITY




2475


Market Analysis

– Benchmarking

– Student Survey

– Demand Projections




Market Analysis

Benchmarking

• Profile of Off-Campus Properties

– Sample Size: 22 properties located within 15 miles of campus

– Property Size: 42 to 689 units; median 208 units

– Leases: All offer 12-month leases; majority offer 6or 9-month leases (most for an additional charge)

– Security deposits: $0 to $450

– Occupancy: 77% to 100%; median 92%




Market Analysis

Benchmarking

• Off-Campus Rents by Unit Type

High

Median

Low

Efficiency

(n=6)


1 Bedroom

(n=20)

2 Bedroom

(n=21)

3 Bedroom

(n=8)



Market Analysis

Benchmarking

• Peer Institutions

– SUNY at Buffalo

– University of Cincinnati

– University of Illinois – Chicago

– University of Kentucky – Lexington

– University of Memphis

– University of Missouri – Columbia

– University of Nevada – Reno

– University of Pittsburgh

– University of South Florida

– Wayne State University




Market Analysis

Benchmarking

• Peers: Beds/Units as a % of Enrollment

Wayne State University

University of South Florida

University of Cincinnati

University of Nevada-Reno


University of Illinois-Chicago

University of Memphis


University of Missouri-Columbia

University of Kentucky-Lexington

University of Pittsburgh

7%

9%

10%

12%

12%

12%

12%

18%

23%

Proposed

23%

25%

65%




Market Analysis

Benchmarking

• Peers: Fall 2004 Occupancy







SUNY at Buffalo


– Median: 98.5%

82%

93%

97%

98%

99%

99%

100%

100%




Market Analysis

Benchmarking

Peers: Room Rate Suite Double






SUNY at Buffalo







– Median: $4,636

$2,912

$3,108

$3,777

$4,250

$4,280

$4,636

$4,750

$4,790

$5,138

$5,140 Proposed

$5,210

$5,290




Market Analysis

Benchmarking

Peers: Room Rate Suite Double






SUNY at Buffalo






– Median: $4,636


$2,912

$3,108

$3,777

$4,250

$4,280

$4,636

$4,750

$4,790

$5,138

$5,210

$5,290



Market Analysis

Student Survey

• Off-Campus Housing Costs Per Person

– Single Students

$569

Utilities

Rent

$144

$417

$117

$350

$100

$352

$102

$425

$300

$250 $250

One Bedroom

(n=45)

Two Bedroom

(n=93)

Three Bedroom

(n=47)

Four Bedroom

(n=23)




Market Analysis

Student Survey

Off-Campus Housing Costs Per Unit

– Married/Family Students

Utilities

Rent $870

$625

$175

$685

$160

$245

$625

$525

$450

One Bedroom

(n=16)

Two Bedroom

(n=38)

Three Bedroom

(n=11)




Market Analysis

Student Survey

Median Price Per Unit Comparison With

Market Rents

Market

ASL Market Sample

Single Student Survey Respondents

Married/Family Survey Respondents

Efficiency

$460

$392

-

One

Bedroom

$459

$425

$450

Two

Bedroom

$562

$600

$525

Three

Bedroom

$779

$750

$625

– Students are generally renting at or below the median price in the market

– Married/family students generally seek lower cost housing than single student who share the rent




Market Analysis

Student Survey

Unit Types and Rents Tested in the Survey

Renovated Traditional

Double

Improved Traditional

Double

Unit Type

New Semi-Suite Double

New Semi-Suite Single

Description

Full renovation that includes new furniture, new wall and floor finishes, replacement of heating and cooling, plumbing, electrical systems, and new windows so that the hall is like when it was first built

Full renovation as described above plus more private and less crowded bathrooms, new study/lounge areas, expanded public areas including kitchens, laundries, and meeting rooms, improved in-room temperature control, and new acoustically insulated windows

New construction, two double rooms sharing a semi-private bath (similar to Kurz Hall)

New construction, two single rooms sharing a semi-private bath (similar to Kurz Hall)

Tested

AY Rent

Monthly

Equivalent

$3,920

$4,600

$5,140

$5,860

$436

$511

$571

$651




Market Analysis

Student Survey

Most Important Factors Respondents

Considered in their Housing Decision

Affordable cost

Proximity to campus facilities and services

Adequate living space

Have personal space/privacy

Have own bedroom

Security

Freedom from rules and regulations

Physical condition of the housing

Ability to meet other students/social atmosphere

Availability of parking

0


Overall

On Campus

Off Campus

500 1000 1500 2000 2500



Market Analysis

Student Survey

Interest in Proposed Housing

9%

9%

37%

57%

45%

On Campus


18%

20%

Off Campus

Would not have lived there.

41%

15%

26%

Probably would not have lived there (less than a

50/50 chance).

Might have lived there

(50/50 chance).

18% Definitely would have lived there.

Total

Residence Hall Renewal Master Plan


Market Analysis

Student Survey

Reasons for Lack of Interest in Proposed

Housing

The housing is too expensive

Prefer to rent off campus

I live with my parents/relatives

Concerned about the level of rules & regulations

I do not want to move

I live with my spouse and/or children

Prefer Bettie Johnson Hall

I already own a home

Prefer existing traditional campus housing

Prefer Louisville Hall

Prefer University Tower or Medical/Dental Apartments

0


Off Campus

On Campus

200 300 400 500 600

Number of Respondents


Market Analysis

Demand Projections

Off-Campus Student Demand – Fall 2004

Class

Freshmen

Sophomores

Juniors

Seniors

Full-time

Off-Campus

Enrollment

2,167

1,884

2,120

2,285

8,456

Definitely Interested Might Be Interested

Capture

Rate

50%

Closure

Capture

Rate

25%

Closure

Projected

Demand

8%

2%

5%

3%

82

22

48

36

187

30%

17%

21%

17%

164

79

114

98

454

245

101

161

134

641

– Overall, 7.5% of current offcampus residents “would” or

“might” be interested in the proposed housing

– Significant percentage of off-campus freshmen interested




Market Analysis

Demand Projections

On-Campus Student Demand – Fall 2004

Class

Freshmen

Sophomores

Juniors

Seniors

Full-time

On-Campus

Enrollment

1,550

604

164

68

2,386

Definitely Interested Might Be Interested

Capture

Rate

50%

Closure

Capture

Rate

25%

Closure

50%

45%

30%

33%

389

135

24

11

560

35%

35%

53%

33%

135

53

22

6

215

Projected

Demand

524

187

46

17

775

– Overall, 32% of current on-campus residents “would” or “might” be interested in the proposed housing

– Lower-division students most interested




Market Analysis

Demand Projections

Total Demand by Unit Preference – Fall 2004

Unit Type

2004 Rent

Per Student

Per AY

Renovated Traditional Double $3,920

Improved Traditional Double $4,600

New Semi-Suite Double

New Semi-Suite Single

$5,140

$5,860

Total

Off-Campus Students

Preference Demand

18%

30%

20%

32%

117

194

127

204

100% 641

On-Campus Students

Preference Demand

20%

42%

19%

19%

158

323

149

144

100% 775

Total

Projected

Demand

274

517

276

348

1,416

– Demand at higher rents for renovated traditional halls and new semi-suites still exceeds the proposed supply of 1,033 beds





Operations Analysis

– Progress Report

– Challenges and Opportunities

– Visioning the Future




Operations Review

Overview

• Four Aggressive Years of Growth and

Improvements

• Challenges and Opportunities Remaining

– Major issues and recommendations for University

Leadership

– Major Issues and recommendations for Housing and

Residence Life

• Visioning the Future




Operations Review

Progress Report

• Four Years of Growth and Improvement

– General fund subsidy has been eliminated from the housing budget

– Student housing capacity has grown in four years from 9% to over 12% of fulltime undergraduate students

– Space renovated in Threlkeld for the Etscorn Honors

Center – significant endorsement of the learning value of living on campus




Operations Review

Progress Report

…

More Improvements

– Housing cancellation policies and penalties have improved spring occupancy by 2-3 % annually.

– Enhanced security and fire safety program with access control and sprinkler systems

– Began house calls and facility assistant visits

– Enhanced the First Year Experience for residential students with various initiatives




Operations Review

Challenges and Opportunities

• University Leadership

– Do you want the residential experience to help recruit tomorrow’s best students?

– What level of commitment is sustainable from academic affairs for world-class residential learning communities?

– Can retention be increased through the nexus of a distinctive residential experience?

– Is the time right to establish a single source campus housing management approach?




Operations Review


• Recommendations for University

Leadership

– Effect the coordinated marketing and management of

UofL Housing with ULP to have a single source of authority for the University’s student residential experience

• Recruitment - Marketing

• Retention

• Asset management

• Occupancy designations

• Policy development

• Academic and educational focus




Operations Review



Leadership

– For a specified period of years consistent the housing master plan, re-direct general fund overhead charges, interest on housing revenues/reserves and housing budget surpluses directly to the residential capital projects




Operations Review



Leadership

– Delegate to the Housing and Residence Life management team the decisions of where students should be assigned based on market forces and educational needs.

– Develop a plan to eliminate the requirement that upper class students living on campus must purchase a meal plan




Operations Review



Leadership

– Appoint a task force of faculty and student affairs and housing staff to develop a strategic plan for an expanded focus on residential learning

– Provide appropriate educational funds to support the residential learning initiatives needed to support recruitment and retention of students





• Housing and Residence Life

– How can the residential facilities and the on campus experience support recruitment and retention of students?

– Can we guarantee housing to all first year students?

– What is the primary focus of the educational experience in residence life?

– Can you develop business practices that enable full tracking of all fiscal issues while allowing reduction in operating costs

– Should you adopt practices where appropriate from the

Allen & O’Hara management and marketing model



Operations Review


Operations Review


• Recommendations for Housing Leadership

– Develop a plan, in collaboration with enrollment management, to guarantee all first year students who apply by May 1 st each year (and thereafter as well)

– Identify market niches and marketing strategies to increase overall fall occupancy by 2-3% within three years




Operations Review



– Establish first year residence halls so that frontloaded student support can efficiently enhance their retention to the sophomore year

– Centralize housing’s residence life and student services around simplified and focused residential learning objectives to enhance the success of first year and other residential students




Operations Review



– Reduce operating expenses through re-organization, more clearly focused student academic success activities, and re-engineered business practices

– Develop a business model scenario applying the ULP operations structure to UofL Housing to clearly identify the added operating expenses of the current

H&RL budget

– Analyze the differences to determine if the added expenses are justified by student outcomes in terms of recruitment or retention




Operations Review


– The educational experience gained by living on campus is recognized and valued by all stakeholders

– Aggressively funded capital investments transform the traditional residence halls into engaged learning environments with comfortable and secure accommodations

– The recruitment of your next generation of students is enhanced by the quality of the residential experience at the University of Louisville





Facility Assessment and Plan

– Assessment

– Options

– Implementation





Part One - Analysis

Facility Existing Condition Assessment

• Site

• Structure

• Exterior Enclosure

• Roof

• Finishes

• Conveying

• Mechanical, electrical, Plumbing, Fire Protection

Systems

• Building Code

• ADA Accessibility

Program Assessment

• Unit types / mixes

• Amenities

• Living – learning Communities



Miller Hall – Recommended Option

Threlkeld Similar

System Renewals

•New Mechanical System

•New Electrical System

•New Windows

•New Roof

•New Interior Finishes

•Elevator

Laundry

WC

Vending

.

Kit

Front Desk

Recreation

Seminar

Lounge

(2500 sf new)

Residence

Hall

Computer

WC

Shared

Spaces

Office

Elev .

2B 2B 2B 2B Bath

Lounge

2B 2B 2B 2B 2B 2B 2B 2B 2B

RD

Apt.

Floor 1




Miller Hall – Recommended Option

Threlkeld Similar

2B 2B Lng 2B 2B 2B 2B 2B 2B 2B 2B 2B

2B 2B 2B 2B 2B 2B 2B 2B 2B 2B 2B

Bath

Elev.

2B 2B 2B 2B 2B 2B 2B 2B Lng

Bath

2B 2B

Floor 2-4

2B 2B 2B 2B 2B 2B 2B 2B 2B 2B 2B 2B




49 Complex – Recommended Option

Three existing dormitories, three stories each.

First floor elevations are unequal

Underutilized first floor plan




49 Complex – New Construction

Service

Two new 250 bed Residence Halls at 65,000 GSF each.

4 levels.

Food Service at 9,500 GSF. 1 level.

2 Fraternity Chapter Rooms at 4,000 GSF




Reasons for replacement of 49 Complex

• New Unit types

• All new systems, better fit to campus

• Better use of site

• New image for complex = higher rents

49 Complex - New Construction Floor Plan

Reasons for removal of Stevenson Hall

• Existing rooms too small for doubles

• Raises $ / bed cost to higher than new construction

• Removed beds accommodated in 49

Complex replacement

• Residence Life offices remain at

Stevenson; upper floors change program use

First Floor Plan

ANDERSON STRICKLER, LLC i



49 Complex - New Construction Floor Plan

Typical Floor Plan




Semi-suites Options for New Construction

1B 2B STUDY

LOUNGE

2B 1B


1B 2B

2B 1B

BATH

Living Learning Suite




Implementation Plan

– Scope

– Financial Plan

– Summary Recommendations




Implementation Plan

Scope

• On-Campus Facilities

– Operations: All existing halls

– Capital Improvements: Residential master plan projects; others deferred

• ULP Beds

– Bettie Johnson, Kurz, and Campus Commons not in financial model

– Project surpluses source of revenue only

– Merger of management systems to be determined




Scope

• ULP Merger/Acquisition

– Ownership to remain with ULH

• No financial benefit to University ownership

• Risk of financial default should remain with ULH

• Improving net available cash flow to University

• Additional debt service not advisable in wake of $50 million in new debt for residential master plan

– Management

• Short-term: Process re-engineering to approach vision

• Long-term: Realignment to single point of control within University to achieve vision



Implementation Plan


Implementation Plan

Financial Plan

• Challenges and Constraints

– Rental rates are low

– High operating costs per bed

– Ongoing renewal and replacement

– Existing debt service

– No reserves

• Outcome: Minimal existing debt capacity to fund renovations and quality construction




Implementation Plan

Financial Plan

• Creating Debt Capacity

– Increase rents faster than operating costs

– Charge rental premiums for comprehensive renovations and new construction

– Trim operating costs and non-operating transfers

– Minimize capital expenses

• Outcome: Increased cash flow that can be leveraged to fund capital improvements




Implementation Plan

Financial Plan

• Revenue Assumptions

– 6% annual escalation through FY2009 all beds

– 45% premium in year following project completion

– 95% post-completion occupancy

• Operating Cost Assumptions

– Current operating results as baseline

– 3% annual inflation (i.e., 3% less than rents)

– 10% reduction in year following completion




Implementation Plan

Financial Plan

• Capital Improvements

– Capital Expenses

• 25% of annual surplus, if available

– Construction Costs

• Renovations based on input from planning team

• $160 per gross square foot for new construction

– Development Budgets

• Include FF&E, design fees, development costs, contingency, and financing costs

• Average markup 33% of construction costs




Financial Plan

• Financing and Reserves

(New/Reno)

– Bond coupon rate

– Term yrs

5.5%

30 yrs

5.0%

20

– Earnings on reserves 2.5%

– Reserves

• Balance of $1.0 million assumed as of 7/1/2005

• Operating surpluses are transferred to reserves

• Operating deficits are funded from reserves

• Provide backup debt service coverage



Implementation Plan


Implementation Plan

Financial Plan

• Summary

Project

49A: West Hall

49B: Center Hall

49C: Wellness Hall

New Commons Phase 1

Threlkeld Hall

New Commons Phase 2

Stevenson Hall

Miller Hall

Unitas Towers

University Tower Apts

Medical Dental Complex

Louisville Hall


Project

Type

Vacate

Vacate

Vacate

New Construction

Renovation

New Construction

Vacate

Renovation

Deferred

Deferred

Deferred

Deferred

Revenue

Beds/Units

0

250

0

0

241

250

0

292

298

100

100

209

1,740

Development

Budget

-

-

-

14,309,000

9,467,000

14,733,000

-

11,830,000

-

-

-

-

$ 50,339,000

Scheduled

Completion

Aug-2006

Aug-2006

Aug-2006

Aug-2007

Aug-2008

Aug-2008

Aug-2009

Aug-2009



Implementation Plan

Financial Plan

• Bed Distribution

3,500

3,000

2,500

ULP Beds

Single

Double

Triple

Quad

2,000

1,500

1,000

500

0

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20




Implementation Plan

Financial Plan

Operating Budget

$16,000

$14,000

$12,000

$10,000

$8,000

$6,000

$4,000

Net Revenue

Operating Cost

Net Operating Income

$2,000

$0

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20




Implementation Plan

Financial Plan

Debt Service Coverage

2.20

2.00

1.80

1.60

1.40

Target Min. Coverage

Debt Service Coverage

1.20

1.00

0.80

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20




Implementation Plan

Financial Plan

Reserves

$20,000

$15,000

Restricted for Debt Coverage

Unrestricted Funds

Transfer To (From) Reserves

$10,000

$5,000

$0

'06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20

($5,000)




Implementation Plan

Summary Recommendations

• Establish advisory team to oversee the Plan

• Collaborate with Academic Affairs to establish living/learning environments

• Formalize inter-departmental business processes and agreements in support of full auxiliary status

• Seek operational and programmatic efficiencies to reduce operating costs

• Implement phased facilities renewal plan

• Move oversight and control of ULP management to

Residence Administration







Program Summary

Gross Area/ Floor (first)

Gross Area/ Floor (2-4)

Gross Area/ Floor (5-7)

Total Area

First Floor

Typ. Office Area

7 Offices per Floor

Building Lobby

Apts Lobby

10,650 SF

32,331 SF

24,735 SF

67,716 SF

190 SF

1,330 SF

265 SF

403 SF

74 Apartments

1 Bedroom (7)

Studio (1)

28 Offices total 5,320 SF

MEDICAL / DENTAL APTS – Recommended Upgrade

1B

OF

OF

OF

OF

OF

OF

BATH

BATH

OF

BLDG

LOBBY

RES

LOBBY

1B

ST

1B 1B 1B 1B 1B

Floor 1




Program Summary

Second Floor to Fourth Floor

1 Bed room/Studio (10)

2 Bed room (1)

Work room (1)

MEDICAL / DENTAL APTS – Recommended Upgrade

2B

OF

OF

OF

OF

OF

OF

BATH

BATH

OF

Work room

ST ST 1B

LOB

ST


ST 1B ST 1B 1B 1B

Floor 2-4



University of Louisville Residence Hall Renewal Master Plan

University of Louisville

• Off-Campus Rents by Unit Type

• Peers: Beds/Units as a % of Enrollment

• Peers: Fall 2004 Occupancy

Peers: Room Rate Suite Double

Peers: Room Rate Suite Double

• Off-Campus Housing Costs Per Person

Off-Campus Housing Costs Per Unit

Median Price Per Unit Comparison With

Market Rents

Unit Types and Rents Tested in the Survey

Most Important Factors Respondents

Considered in their Housing Decision

Interest in Proposed Housing

Reasons for Lack of Interest in Proposed

Housing

Off-Campus Student Demand – Fall 2004

On-Campus Student Demand – Fall 2004

Total Demand by Unit Preference – Fall 2004

Operations Analysis

• Four Aggressive Years of Growth and

Improvements

• Challenges and Opportunities Remaining

• Visioning the Future

• Four Years of Growth and Improvement

…

More Improvements

• University Leadership

• Recommendations for University

Leadership

• Recommendations for University

Leadership

• Recommendations for University

Leadership

• Recommendations for University

Leadership

• Housing and Residence Life

• Recommendations for Housing Leadership

• Recommendations for Housing Leadership

• Recommendations for Housing Leadership

First Floor Plan

Typical Floor Plan

Living Learning Suite

Implementation Plan

• ULP Merger/Acquisition

• Challenges and Constraints

• Outcome: Minimal existing debt capacity to fund renovations and quality construction

• Creating Debt Capacity

• Outcome: Increased cash flow that can be leveraged to fund capital improvements

• Revenue Assumptions

• Operating Cost Assumptions

• Capital Improvements

• Financing and Reserves

• Summary

• Bed Distribution

Operating Budget

Debt Service Coverage

Reserves

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