Impact of enrollment decline hits apartment market
COLUMBIA - The decrease in enrollment at MU is leaving apartment companies short of their leasing goals.
"We're not where we want to be quite yet, quite frankly most places aren't where they want to be," said David Cochran, District Flats general manager.
In an effort to increase interest, District Flats on 8th street has reduced rent prices on some units by $200 and waived security fees. Cochran said he has not had to let go any staff or significantly decrease resident perks.
Cochran said District Flats and other complexes traditionally aim to be full by mid-May, but are now having to lease through the summer to reach maximum occupancy.
Liz Young, community manager for The Reserve at Columbia, said it is not concerned about the occupancy as of now, but is planning to budget accordingly if the decrease continues.
"We opened lower than what we had projected," Young said.
She said management has confidence the enrollment numbers at MU will rise with time.
Both Cochran and Young said they had corporate financial support and flexibility during this period.
In a statement, the U Centre on Turner, which is currently under construction, said there has been "softness in the enrollment" but "the University of Missouri is a strong flagship institution that we believe in."
Overall, MU enrollment decreased by 7 percent from fall 2015 to fall 2016. Incoming undergraduates decreased by 22 percent. The official numbers for the fall 2017 MU enrollment will come out in May.
In response to the decrease, MU closed Respect, Excellence, Lathrop and Laws dormitories in the last year.
Meanwhile, new apartment buildings are being built on 9th street and Elm street. Others have just been opened for the previous academic year, including TODD on 5th street.
"For awhile there was a lot of money to be made, the places were all full. Rents were high, so it made sense to build," Cochran said. "Now it takes several years from the concept stage until when the kids move in. In that time period the market shifted."
This has forced local apartment companies to lower their prices and increase signing perks.
"We got a few hundred dollars up front," Patrick Turgeon, an MU junior said.
Turgeon signed a lease with U Centre for the fall. He said he was given a pre-paid gift card and said his current location, The Lyfe off Nifong, is doing the same.
"I get emails all the time about them giving out money for signing," Turgeon said.
The increase in market competition has also pushed down prices for downtown studio apartments.
Jessica Reid, an MU junior, is returning to the Belvedere apartments on Hitt street and is paying under $400 a month for rent and parking.
"The location is phenomenal, I'm three minutes from campus and likewise from Broadway," Reid said.
Cochran said, going forward, he anticipates a decrease in student housing projects.
"Smaller projects, when they are built. Maybe more mixed use projects. Ones that are not so dependent on students, because that market, like we've talked about, is maybe shrinking or stagnating," he said.