Affiliation Agreements between Schools
and Off-Campus Housing providers
Shannon Staten
University of Louisville
Sarah Samuels
Jason Taylor
The Scion Group LLC
Student Housing Affiliation Agreements
Session Overview
• What is a student housing
affiliation agreement?
• Motivating factors
• Institutional participation
• Case studies
Student Housing Affiliation Agreements
Basic Concepts
• Aspects of affiliation agreements
• Balance of risk and control
• Application and outcomes
Student Housing Affiliation Agreements
What is an Affiliation Agreement?
A formal agreement in which a college or
university directs students to an offcampus property as if it were part of its
own inventory.
Student Housing Affiliation Agreements
What is an Affiliation Agreement?
In addition to directing students to the
property, the college/university may…
• control some aspects of operations
• lease the land to the owner
• offer some guarantees
Student Housing Affiliation Agreements
What is an Affiliation Agreement?
In addition to providing housing to students,
the property owner may…
• adhere to the school’s residential policies
• share some decision-making authority
• provide financial incentives
Student Housing Affiliation Agreements
Motivating Factors
•
•
•
•
•
•
•
Address an urgent need
Expedite development
Gain experience and expertise
Reduce risk
Broader planning goals
Limit credit impact
Obtain favorable balance sheet treatment
Student Housing Affiliation Agreements
Institutional Participation
“The college/university may…”
Control aspects of operations
• Residence life (staffing and training)
• Community living standards
• Security
• Information technology
• Marketing / Room assignments
• Billing / Collection
• Maintenance / Custodial
Student Housing Affiliation Agreements
Institutional Participation
“The college/university may…”
Lease land to owner
Offer some guarantees
• Assumption of bad debt
• Occupancy guarantee
• Master lease for some portion or period of time
• Assume construction / delivery risk
Student Housing Affiliation Agreements
Institutional Participation
“The property owner may…”
Adhere to the school’s residential policies
• Restrict marketing activities
• Agree to mediate landlord/tenant conflicts
• Provide residence life staff and/or programs
• Enforce student code of conduct
Student Housing Affiliation Agreements
Institutional Participation
“The property owner may…”
Share some decision-making authority
• Construction standards
• Life safety requirements
• Rental rates
• Early contract termination
Student Housing Affiliation Agreements
Institutional Participation
“The property owner may…”
Provide financial incentives
• Annual affiliation fee
• Fee for school’s services
• Profit-sharing from operations or sale
• Reversionary rights
• Right of first refusal or last offer
Student Housing Affiliation Agreements
Institutional Participation
Generally, a school’s control over a property
and exposure to risk are directly proportional
to its level of participation with the affiliated
property.
OR…
The more involved you become  the more
control you have  the more risk you take
Student Housing Affiliation Agreements
Case Studies
University of Michigan Off-Campus Housing Program
The University…
• Lists properties on its website
• Provides landlord/tenant conflict mediation services
• Hosts an annual “off-campus housing fair”
Property owners…
• Pay an annual fee
• Agree to use the University’s standard lease
• Enter conflict mediation before civil litigation
Student Housing Affiliation Agreements
Case Studies
University of Michigan Off-Campus Housing Program
As a result…
• Decreased landlord/tenant litigation
• Increased compliance with municipal codes
• Improved town/gown relationship
• Annual off-campus rental rate and occupancy report
Student Housing Affiliation Agreements
Case Studies
University of Illinois Private Certified Housing
Private Certified Housing
• ~3,000 beds in 15 properties
• Satisfy first year live-on requirement
• Participate in U of I residence life staff training
• Provide on-site dining services and meal plans
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
UL had a need for 2,100 additional beds of
apartment-style student housing and could not
provide land or a master lease.
In fall 2007, UL issued an RFP to property
owners and developers.
UL reached agreement with two developers to
provide up to 1,600 beds by fall 2011; 850 of
which opened in fall 2009.
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
ULP Residence Halls (1,288 beds – Opened 2000-07)
EDR Realty Trust
• On University-owned land, ground leased to foundation
• Joint design decisions
• Delivered by design-build-manage RFP process
• Goal to deliver a seamless experience to students
• Common application and license
• Common billing & collections
• Considered on-campus inventory
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
The Province (858 beds – Fall 2009)
Edwards Communities
• UL designated the amount of graduate student housing
• Adhere to UL life safety and on-site staffing guidelines
• Rental rate increases tied to campus housing and HEPI
• Early termination agreement
• Common application
• Annual affiliation fee
• Profit-sharing from property sale
• UL right of first refusal to purchase
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
Benefits to the University
• Increase housing inventory
• Purpose-built LLCs
• Flex space for on-campus renovations
• Control experience based on institutional priorities
• Extend campus border
• Created affiliated housing tiers
• Retain control over community development
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
Continuum of Housing Affiliations
• Five levels for 16 communities
• Define UL participation
1
2
3
4
5
Low est
affiliation /
involvem ent
Moderate
affiliation /
involvem ent
Medium
affiliation /
involvem ent
Ow nership /
m odified
control
Ow nership /
intensive
control
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
Continuum of Housing Affiliations
• Application
• Assignment
• Lease / Licensure Agreement
• Billing / Collections
• Facility management
• Reception / Security staff and systems
• Fire / Life safety standards and monitoring
• IT / Voice / Cable
Student Housing Affiliation Agreements
Case Studies
University of Louisville Affiliated Student Housing
Continuum of Housing Affiliations
• Mandatory Dining Plan
• Housing staff ratio
• UL point of contact
• Policy enforcement
• Resident group
• Community living standards responsibility
• Student development / residence life
• Management fee target
Student Housing Affiliation Agreements
Housing Affiliation Agreements
“You can privatize your housing, but you can
not privatize your relationship with
students and parents”
Student Housing Affiliation Agreements
Thank You!
Sarah Samuels - sls@thesciongroup.com
Shannon Staten – sdstat01@louisville.edu
Jason Taylor – jat@thesciongroup.com
www.thesciongroup.com
www.louisville.edu/housing
Student Housing Affiliation Agreements