Place Properties hopes to remain a leader in the student housing market.

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As the country’s largest private developer of student housing, Atlanta-based Place Properties is enjoying steady growth in the private sector.

Student housing is becoming an increasingly privatized industry, CEO and Chairman Cecil Phillips says, and Place Properties hopes to maintain its edge by environmentally and technologically conscious marketing.

In a recent interview, Phillips told Construction Today why the student housing market is unique and what future tenants of Place Property housing can expect.

Construction Today: What are some recent company developments?
Cecil Phillips: A couple years ago, Place was the beneficiary of a new, private equity fund.  

An offshore pension fund and two State retirement systems in the United States contributed nearly $300 million in equity to help Place develop and acquire student housing all over the country.

This summer, we are finishing seven off-campus student housing communities all over the country. We are about to start 14 more in the Southwest, Southeast and Midwest for delivery in 2009.  

We are currently acquiring four existing properties, two of which are conversions from condominiums in urban environments to student housing.

CT: What would you say is unique about student housing in the real estate market?
CP: Student housing is a particular product type in terms of design. We rent by the bedroom, not by the unit. The parents are the guarantors of the leases for their children, which is a very different leasing model from market-rate units.

We also see (for-rent rather than for sale as condominiums) as a better financing model, especially in today’s lending environment. We are typically doing anywhere between seven and 15 new developments at one time. We will also likely do six acquisitions this year.

CT: How is the market changing?
CP:  Student housing is changing in ways that reflect the world-view of our customers. The way our customers communicate is changing and social networking like MySpace and YouTube plays a big role in their lifestyles. We have to reflect those changes in the way we market to our customers, and we are.

CT: How so?
CP: We are incorporating technological advances into our design, and being very sensitive to the environment in the way we build and manage things. For example, at some of our communities, we will provide bicycles to our tenants so they can bike to class instead of drive their car. We already sponsor a lot of environmental activities, such as cleaning up litter from highways. We also follow LEED guidelines for these buildings. Although, we can’t get LEED certification for the garden-style apartment construction that we do.

In terms of incorporating technology, we have high-speed Internet technology in every unit.

We also try to use technology to create a greater sense of community within and among our tenants. We [want to] have online competitions between and among our communities throughout the country. We also want to start using voice-activated technology. It is not ready for prime time yet, but it is coming and we want to be ready.

CT: What distinguishes your company’s work from that of competitors?
CP: We are a private company and that allows us to make decisions that do not have to be justified on a quarterly basis.     We have access to sufficient capital and the financial and personnel freedom to execute our strategic plan in a way that smaller private and public companies do not.

The privatization of student housing on and off campus is part of a much larger change in America.

We are seeing that private capital is replacing public capital, even when it comes to repairing roads and bridges, because the tax base is no longer sufficient to do things in the amount of time that is necessary. It never was more true than today that time is money.

As private capital replaces public capital for mega -projects, academic leaders today will have to husband the public capital that is not used for a university’s core mission. That represents a great opportunity for those of us who have access to private capital markets to do public good.