The University of Colorado at Colorado Springs is one of the fastest growing Universities in all of Colorado. Enrollment at the university totaled 12,197 in fall 2019, accounting for a staggering 37% increase since 2010.
Additionally, UCCS has built more than 1.2 million square feet of building space since 2009 helping to support the rapid growth the university has experienced. The university also has an annual economic impact of $431 million. With recent rapid expansion, off campus housing solutions has become a necessity and will continue to be for years to come.
In 2013, UCCS implemented a mandatory on-campus residency for freshman students although they only have 1,700 beds to house the 2,400+ freshman class. Approximately 10,500 students are required to find off-campus housing provided by the private market. This limited supply in student housing inventory has driven the success of new build products such as 11 West.
66% of UCCS undergrads are awarded financial aid. 11 West offers students affordable, high quality housing. This competitive advantage sets 11 West apart from other student housing alternatives.
Overall market fundamentals in Colorado Springs are extremely strong. The occupancy rate is highly stable over 96%, up 90 basis points year over year. Effective average rents are up to $1,149, a robust 5.9% increase annually and an impressive 33% since 2014. The median home price is up 12.3% year over year and a rent versus own payment delta of $303, which should keep people renting longer and continue to drive rent growth to close the gap.
11 West is two and a half miles from the University Village Colorado shopping center providing residents with all their retail needs. As the premier shopping destination in Colorado Springs, the shopping center features 650,000 square feet of retailers, restaurants, and services. Some popular tenants include Christy Sports, Costco, Famous Footwear, Kohl’s, Lowe’s, Petco, and the only Trader Joe’s in Colorado Springs.
The economy in Colorado Springs has seen an immense amount diversification in recent years with an emphasis on expanding the business and health care sectors. The professional and business services sector bared 2,600 new jobs through third quarter 2019 for a metro leading 5.6% expansion. Further, there are more than $1 billion in health care related projects planned through 2020.
As of fourth quarter 2019, 9,300 net jobs were created in the Colorado Springs MSA displaying an outstanding 3.1% increase year over year. Unemployment was at 3.9% in 2018 and fell by a considerable 50 basis points to 3.4% in fourth quarter 2019.
11 West is a new purpose-built student housing development supporting the University of Colorado in Colorado Springs, Colorado. The property includes 54 fully furnished apartment homes featuring two bedroom, two bathroom models, and three bedroom, two bathroom layouts totaling 142 bedrooms. 11 West is one of only five purpose-built student housing assets that supports the University of Colorado at Colorado Springs (UCCS), and it’s growing 12,000+ student population.
The site sits upon the picturesque foothills of Colorado Springs and is surrounded by breathtaking recreational hiking trails. Student residents of 11 West can easily walk to classes on campus at UCCS and bike to the University Village Colorado Shopping Center, Colorado Springs' premier retail destination. The property boasts high-end unit amenities including personal balconies or patios, walk-in closets, full appliance packages, solid-surface counters, vinyl plank wood flooring, central air conditioning, in-unit washer and dryers, and all furnishings and kitchenware. Community amenities include cable and internet, copy and printing services, proximity to numerous parks, shopping, and public transportation. 11 West is currently operated via a by the bed model offering student residents individual leases with guarantors. This operating model has proven the asset to achieve a premium on rental rates versus a joint and several lease counterpart.
A new owner will have the opportunity to acquire a well-located, new built asset with the ability to capitalize on operational upside to improve occupancy which is supported by several assets within the rental comparison competitive set. In addition to improving occupancy at the property, a new owner can rely on the strength of the Colorado Springs market that has experienced tremendous rent growth of approximately 4% year over year and net absorption close to doubling new unit deliveries in 2019.
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