University of Houston Campus Developments

[kdog08]

I've got a niece going to UT as a freshman and she's living in an apartment way off-campus. I don't see that particular freedom as something that detracts from the school's reputation. And in the context of other universities, both which do or do not allow freshmen to live off campus, UH holds its own pretty well.

But to be clear, being informally considered a "commuter school" is not the same thing as allowing freshmen to have choice in their housing situation. UH's reputation is complicated, and it actually varies by ethnicity. I've been told that it is reputed as a party school among South Asians, but that wasn't my experience at all...nor did I want that to be my experience. Having said that, my commute from off-campus was only a few miles and could've been pulled off by bus if I didn't prefer to work instead of racking up student debt. I had the option to live on campus, but it was too expensive and didn't make any sense for me. I got a much better deal off-campus. If the situation is similar for present freshmen going to UH, then I don't see that they'd be done a favor by being denied the option to live off-campus. And if the new housing is being subsidized by funds that could've been routed to other university programs, then they're losing out too.

I don't find anything wrong with on-campus housing, but I do think that people ought to have a choice to live there and I don't think that it ought to be considered a priority over just about any other program that UH might offer instead.

It's unfortunate that this is the case, but if UH wants to increase its appeal and make it a first-choice school the way that UT and A&M already are, it needs to vastly improve the reputation of its football program. High school seniors (on the whole) respond to brand awareness that is tied to pop culture rather than academics.

Dang it's 4AM and I'm responding to a forum, this job market sucks for newly graduates, even biology graduates. What it comes down to is brand awareness, which UH just doesn't have in my opinion. UH isn't on the same level as Texas Tech, UT, and A&M in my mind and I would wager a sum of money most Texans would feel the same way. To be clear, I'm not advocating that all freshman should be required to live on campus but advocating that UH should do more to promote more students living on campus by building more dorms or whatever they want to call them.

[Original Timmy Chan's]

Good to hear that UH has secured its way to tier 1 status.

Not even close to secure, in my mind.

The legislation hasn't been signed by Rick Perry, and he seems to have a particular grudge against UH.

Once the legislation is signed, then it's up to the voters of Texas to pass a Constitutional Amendment in November to allow for the Tier One funds.

And...like I said, most of those Tier One funds are being taken from a fund that's already supposed to benefit UH and Texas Tech (and TSU, TSU, SHSU, SFA, etc.) and it's going to be opened up to be shared by UT System schools that are already funded by a different, vastly larger fund.

That's why I said, although UH will stand to benefit, we're just robbing the poor to pay the rich.

[TheNiche]

Dang it's 4AM and I'm responding to a forum, this job market sucks for newly graduates, even biology graduates. What it comes down to is brand awareness, which UH just doesn't have in my opinion. UH isn't on the same level as Texas Tech, UT, and A&M in my mind and I would wager a sum of money most Texans would feel the same way. To be clear, I'm not advocating that all freshman should be required to live on campus but advocating that UH should do more to promote more students living on campus by building more dorms or whatever they want to call them.

I feel you about the job search. I've got multiple heavily-quantitative degrees and a bunch of work experience, and I'm in the same boat.

I agree about the problem, namely poor brand awareness. But I question whether dormitories are the appropriate advertising vehicle to promote brand awareness. UH is very easily on par with and in some areas handily exceeds Texas Tech's offerings. The only discernible reason Texas Tech gets more press is because of their football program.

[kdog08]

Not even close to secure, in my mind.

The legislation hasn't been signed by Rick Perry, and he seems to have a particular grudge against UH.

Once the legislation is signed, then it's up to the voters of Texas to pass a Constitutional Amendment in November to allow for the Tier One funds.

And...like I said, most of those Tier One funds are being taken from a fund that's already supposed to benefit UH and Texas Tech (and TSU, TSU, SHSU, SFA, etc.) and it's going to be opened up to be shared by UT System schools that are already funded by a different, vastly larger fund.

That's why I said, although UH will stand to benefit, we're just robbing the poor to pay the rich.

Ah I see your point. Well does anyone know how Cali funds their universities, they have the most tier 1 universities in the country (I believe NY is second)? CA is definitely not a fiscal model but maybe they could give us some ideas on how to expand our system.

I feel you about the job search. I've got multiple heavily-quantitative degrees and a bunch of work experience, and I'm in the same boat.

I agree about the problem, namely poor brand awareness. But I question whether dormitories are the appropriate advertising vehicle to promote brand awareness. UH is very easily on par with and in some areas handily exceeds Texas Tech's offerings. The only discernible reason Texas Tech gets more press is because of their football program.

I wouldn't say dormitories are a means of advertising but part of the means to achieve some of the goals laid out by the President. Having a larger on-campus student population can create lots of opportunities for UH. The two years I spent in the dorms were great, the school really had a lot programs to promote social ties among students and various school run activities. I think it stands to reason if you are living on campus you are more likely to become involved with school activities.

[ihop]

I think getting more students living on campus is part of a long term attempt by UH to get students more involved on campus, and build stronger ties to the campus & other students that will result in a more active alumni pool.

[TheNiche]

I wouldn't say dormitories are a means of advertising but part of the means to achieve some of the goals laid out by the President. Having a larger on-campus student population can create lots of opportunities for UH. The two years I spent in the dorms were great, the school really had a lot programs to promote social ties among students and various school run activities. I think it stands to reason if you are living on campus you are more likely to become involved with school activities.

I still fail to understand how dormitories as a budgetary priority is fitting with any aspect of UH's mission as a university. It's not that they aren't nice to have, it's that there are 1) better programmatic uses of the funds, and 2) way to achieve better bang for the buck with respect to a program enhancing brand awareness.

[TheNiche]

I think getting more students living on campus is part of a long term attempt by UH to get students more involved on campus, and build stronger ties to the campus & other students that will result in a more active alumni pool.

I still want to see research linking dormitory use with alumni donations. Even if there is significant alumni giving as a consequence of dormitory use, which I am dubious of, it seems like the rate of alumni giving would peak 20 to 30 years after a person graduates. Consider that the discounted value of $100 at 5% interest 25 years from now is only $29.53.

Opportunity cost is a b.i.t.c.h.

[ricco67]

Opportunity cost is a b.i.t.c.h.

What? it's not a Delicate Flower? (sic)

[lockmat]

I still fail to understand how dormitories as a budgetary priority is fitting with any aspect of UH's mission as a university. It's not that they aren't nice to have, it's that there are 1) better programmatic uses of the funds, and 2) way to achieve better bang for the buck with respect to a program enhancing brand awareness.

Maybe if they intend to actually be tier 1 as the money indicates they should be, the tier 1 type students they'll get won't all be from around Houston, so they'll need affordable housing to put them in?

[TheNiche]

Maybe if they intend to actually be tier 1 as the money indicates they should be, the tier 1 type students they'll get won't all be from around Houston, so they'll need affordable housing to put them in?

At such time as they actually have Tier One funds, and at such time as they are increasing their enrollment as a consequence of greater brand awareness outside of Houston, then it might make sense to develop more student housing. Don't put the cart before the horse.

[lockmat]

At such time as they actually have Tier One funds, and at such time as they are increasing their enrollment as a consequence of greater brand awareness outside of Houston, then it might make sense to develop more student housing. Don't put the cart before the horse.

I understand you're comparing the need for housing to their actual mission statement but what is your opinion as to why any college provides student housing? Do you believe only schools in Podunk towns with very little housing options should provide them?

[Houston19514]

I still fail to understand how dormitories as a budgetary priority is fitting with any aspect of UH's mission as a university. It's not that they aren't nice to have, it's that there are 1) better programmatic uses of the funds, and 2) way to achieve better bang for the buck with respect to a program enhancing brand awareness.

Not sure how they are funding the dormitories at UH. Is it possible they are not using general University funds for their construction, but are essentially self-funding them e.g., with dormitory system revenue bonds? I think some schools do it that way.

[TheNiche]

I understand you're comparing the need for housing to their actual mission statement but what is your opinion as to why any college provides student housing? Do you believe only schools in Podunk towns with very little housing options should provide them?

Most new student housing is privately-developed on land that has either been sold or placed on a long-term lease with a developer or that is privately-owned and is close enough to a university that students can walk there or ride transit. Such student housing is typically garden-style, although it can go midrise in some urban environments, and provides suites intended to house one student per bedroom instead of the traditional SRO setup. American Campus Communities is an example of one of the more active developers of this asset type. Clearly there is benefit to having student housing near a campus. If there weren't, companies like American Campus Communities would not exist. However, the fact that such companies do exist begs the question as to whether there is a market failure that requires public intervention.

[crunchtastic]

Most new student housing is privately-developed on land that has either been sold or placed on a long-term lease with a developer or that is privately-owned and is close enough to a university that students can walk there or ride transit. Such student housing is typically garden-style, although it can go midrise in some urban environments, and provides suites intended to house one student per bedroom instead of the traditional SRO setup. American Campus Communities is an example of one of the more active developers of this asset type.

At UH? My understanding is they own the land and manage the student housing themselves.

[kdog08]

I still fail to understand how dormitories as a budgetary priority is fitting with any aspect of UH's mission as a university. It's not that they aren't nice to have, it's that there are 1) better programmatic uses of the funds, and 2) way to achieve better bang for the buck with respect to a program enhancing brand awareness.

I still want to see research linking dormitory use with alumni donations. Even if there is significant alumni giving as a consequence of dormitory use, which I am dubious of, it seems like the rate of alumni giving would peak 20 to 30 years after a person graduates. Consider that the discounted value of $100 at 5% interest 25 years from now is only $29.53.

Opportunity cost is a b.i.t.c.h.

LOL. Like I've said before, figure it out for yourself. Obviously, being a lurker for the past 5 years, I know you are the kind of person who needs things to be broken down in order to understand things you don't get or don't agree with. Furthermore, like I said I don't really care about researching anything for you in this thread because I could care less whether or not you agree. Even furthermore, who said it was a budget priority or that alumni donations was a driving force in building dorms? Lastly, it's intersting that a UH alumni like yourself seems to know less what's going on their campus than someone who never set foot on their campus.

Talk about a buzzkillington.

Edited June 5, 2009 by kdog08

[TheNiche]

At UH? My understanding is they own the land and manage the student housing themselves.

They do. And that's the legacy of traditional student housing. But there's been a national paradigm shift over the last decade. Most new student housing is developed by private for-profit entities.

[TheNiche]

LOL. Like I've said before, figure it out for yourself. Obviously, being a lurker for the past 5 years, I know you are the kind of person who needs things to be broken down in order to understand things you don't get or don't agree with. Furthermore, like I said I don't really care about researching anything for you in this thread because I could care less whether or not you agree.

I prefer things that I don't understand to be broken down primarily because making assumptions about a line of argument that I don't understand results in frequent errors and miscommunication. It's just good form.

Even furthermore, who said it was a budget priority or that alumni donations was a driving force in building dorms?

It is obviously a budgetary priority because they're allocating resources to dorms instead of to other programs. They had many options and they chose this one.

Alumni donations were suggested previously in this thread as the reason that a larger on-campus residential population would be justified.

[kdog08]

I prefer things that I don't understand to be broken down primarily because making assumptions about a line of argument that I don't understand results in frequent errors and miscommunication. It's just good form.

If this were a board room meeting I would agree but this is the internet yo. Not everyone who presents a response to you or makes a statement is obliged to indulge you by providing a cost-benefit analysis. I know you are smart guy and could look things up for yourself, but if you are lazy like me then say so.

It is obviously a budgetary priority because they're allocating resources to dorms instead of to other programs. They had many options and they chose this one.

I guess it depends on what a priorty is to you. Do we know how much of UH's budget is being spent on dorms? We could start having a meaningful discussion about priorities if that was known.

Alumni donations were suggested previously in this thread as the reason that a larger on-campus residential population would be justified.

So were a few other responses that aren't mentioned by you.

Do you feel that private for profit entities shouldn't be developing student housing? Or are you simply waiting for data to make a decision?

Edited June 5, 2009 by kdog08

[TheNiche]

If this were a board room meeting I would agree but this is the internet yo. Not everyone who presents a response to you or makes a statement is obliged to indulge you by providing a cost-benefit analysis. I know you are smart guy and could look things up for yourself, but if you are lazy like me then say so.

I am lazy like you.

I guess it depends on what a priorty is to you. Do we know how much of UH's budget is being spent on dorms? We could start having a meaningful discussion about priorities if that was known.

It doesn't matter how much of their budget is being spent on dorms. In economics, there is a concept called marginalism. As it applies to the cost-benefit analysis of a portfolio of potential projects, it holds that feasible projects should be undertaken in descending order according to IRR until the capital budget is exhausted. As projects are sequentially green-lighted as one descends the ordered list, each of the remaining uncommitted projects becomes the top priority. If UH's capital budgeting program was carried out professionally, then at some juncture new dorms would've been the highest-priority (i.e. the highest-yielding IRR) uncommitted capital expenditure, surpassing the merit of any other potential uncommitted capital expenditures. There you have it. Priority.

At least, that's how they teach the analytical procedure for capital budgeting at UH.

Given my professional knowledge about student housing, and also a compelling theoretical framework to assess the attractiveness of a university to potential students and how that relates to its reputation and the fulfillment of its mission, I am dubious of the merit of university-owned student housing as a capital expenditure as compared to alternative projects.

Can you field a compelling rebuttal?

Do you feel that private for profit entities shouldn't be developing student housing? Or are you simply waiting for data to make a decision?

Many other universities that aren't nearly as large as UH have attracted private student housing developers. I know for fact that at least two such firms have evaluated UH for opportunities in years past, however they have not been able to justify projects (even when capital was freely flowing through the CMBS markets). If the private sector cannot justify student housing at UH, it seems extremely unlikely that a student housing development would hold its own as proposed by UH itself, especially under the antiquated SRO paradigm, which is what this project sounds like. Therefore it stands to reason that UH is propping up the project from elsewhere in its budget, depriving some alternative project of finite funds.

If student housing can be provided by private developers, more power to them. However, if that's something that they're able to provide, then there does not appear to be a market failure such as would justify intervention on the part of a public entity.

[kdog08]

I am lazy like you.

I appreciate your honesty.

It doesn't matter how much of their budget is being spent on dorms. In economics, there is a concept called marginalism. As it applies to the cost-benefit analysis of a portfolio of potential projects, it holds that feasible projects should be undertaken in descending order according to IRR until the capital budget is exhausted. As projects are sequentially green-lighted as one descends the ordered list, each of the remaining uncommitted projects becomes the top priority. If UH's capital budgeting program was carried out professionally, then at some juncture new dorms would've been the highest-priority (i.e. the highest-yielding IRR) uncommitted capital expenditure, surpassing the merit of any other potential uncommitted capital expenditures. There you have it. Priority.

At least, that's how they teach the analytical procedure for capital budgeting at UH.

Given my professional knowledge about student housing, and also a compelling theoretical framework to assess the attractiveness of a university to potential students and how that relates to its reputation and the fulfillment of its mission, I am dubious of the merit of university-owned student housing as a capital expenditure as compared to alternative projects.

Can you field a compelling rebuttal?

Many other universities that aren't nearly as large as UH have attracted private student housing developers. I know for fact that at least two such firms have evaluated UH for opportunities in years past, however they have not been able to justify projects (even when capital was freely flowing through the CMBS markets). If the private sector cannot justify student housing at UH, it seems extremely unlikely that a student housing development would hold its own as proposed by UH itself, especially under the antiquated SRO paradigm, which is what this project sounds like. Therefore it stands to reason that UH is propping up the project from elsewhere in its budget, depriving some alternative project of finite funds.

If student housing can be provided by private developers, more power to them. However, if that's something that they're able to provide, then there does not appear to be a market failure such as would justify intervention on the part of a public entity.

Well my expertise is in biochemistry and microbiology so all this information is new to me. I do enjoy learning new things which is why I like this site. However, after your lengthy response, why then is UH doing exactly what you just said shouldn't be a priority. Why are universities investing and building dorms that aren't worthwhile then?

Edited June 5, 2009 by kdog08

[TheNiche]

I appreciate your honesty.

Well my expertise is in biochemistry and microbiology so all this information is new to me. I do enjoy learning new things which is why I like this site. However, after your lengthy response, why then is UH doing exactly what you just said shouldn't be a priority. Why are universities investing and building dorms that aren't worthwhile then?

Well it seems most likely that either my professional experience has led me astray and this dormitory project holds its own water, the University has omitted a key point from their mission statement, or the the University isn't using an effective capital budgeting process.

Btw, this is OT but I've got a friend who is an LVN and that wants to get out of nursing and go back to school for a biochem degree. Seems like it's coming down to either UH or UTSA. How would you evaluate that program?

[Original Timmy Chan's]

They do. And that's the legacy of traditional student housing. But there's been a national paradigm shift over the last decade. Most new student housing is developed by private for-profit entities.

As far as I know, the Quadrangle dorms and Towers dorms were developed by UH.

Cambridge Oaks = partnership between UH/Century Property (1991)

Cullen Oaks = partnership between UH/American Campus Communities (2000)

Bayou Oaks = partnership between UH/American Campus Communities (2003)

Best I can tell from a quick internet search, UH is developing Calhoun Lofts and the new freshman dorms on Wheeler on their own.

So, it appears UH has tried both methods, and apparently has decided to go it alone. Maybe their experience has been that they're better off developing on their own? I don't know...

Btw, this is OT but I've got a friend who is an LVN and that wants to get out of nursing and go back to school for a biochem degree. Seems like it's coming down to either UH or UTSA. How would you evaluate that program?

I have a friend who graduated from UH's biochem program...he's now a successful television reporter in California!

Edited June 5, 2009 by Original Timmy Chan's

[TheNiche]

So, it appears UH has tried both methods, and apparently has decided to go it alone. Maybe their experience has been that they're better off developing on their own? I don't know...

It would seem more likely that they weren't able to find a developer willing or able to take on the project on terms that were amenable to UH. Again, if the private sector can't do it...

[totheskies]

It would seem more likely that they weren't able to find a developer willing or able to take on the project on terms that were amenable to UH. Again, if the private sector can't do it...

Bing...

They are still seeking "private assistance" for the new Freshmen dorms that are under development... though I highly doubt it will be anything like the way Bayou or Cullen Oaks have been run. Many students have been displeased with their customer service.

For UH, public-private partnerships have proven to be almost perfectly pertinent.

[KinkaidAlum]

Many might find it surprising, but UH has had overcrowding in the dorms over the last few years. Demand is greater than the supply of beds. I know that they've had to turn common rooms into bedrooms in places like the Moody Towers.

The two main factors holding UH back are a pathetic alumni giving rate (less than 6%) and low 6 year graduation rates (less than 60%).

It is widely believed that if UH can draw more traditional students who also choose to live on campus, they can raise both the giving rates and the graduation rates. It doesn't take too much of a leap of faith to see how students who live on campus might find a stronger connection to the school.

[lockmat]

Is any revenue made from dorms?

[Houston19514]

It is obviously a budgetary priority because they're allocating resources to dorms instead of to other programs. They had many options and they chose this one.

This is where I think you've gone astray, Niche. It is very possible (even likely) that the dormitories are funded with revenue bonds, backed by the revenue generated by the dormitories. (This is the way the graduate student housing was funded, I believe.) If so, then they are not allocating resources to dorms instead of to other programs. (Because the revenue bond resources would not in fact be available but for the dorms.)

[TheNiche]

This is where I think you've gone astray, Niche. It is very possible (even likely) that the dormitories are funded with revenue bonds, backed by the revenue generated by the dormitories. (This is the way the graduate student housing was funded, I believe.) If so, then they are not allocating resources to dorms instead of to other programs. (Because the revenue bond resources would not in fact be available but for the dorms.)

The capital structure is not especially relevant. Private developers issue collateralized debt, too, and lots of it.

[Houston19514]

The capital structure is not especially relevant. Private developers issue collateralized debt, too, and lots of it.

I was addressing your complaint about them prioritizing the dormitories over other investments, not the question of public or private developers. If they are using revenue bonds backed by the revenue from the dormitories, then they are NOT in fact allocating resources to dormitories instead of to other programs. The resources being allocated to the dormitories are being generated by the dormitories and are not available for other programs.

Edited June 6, 2009 by Houston19514

[N Judah]

It is widely believed that if UH can draw more traditional students who also choose to live on campus, they can raise both the giving rates and the graduation rates. It doesn't take too much of a leap of faith to see how students who live on campus might find a stronger connection to the school.

Also I would not be surprised if some of it had to do with the Honors College. If I were a potential honors student I would be really turned off by the dorms.