ChicagoDowntown / Loop

How will new university housing impact the downtown rental market?

by Joe Zekas on 12/12/11

According to the Chicago Loop Alliance (pdf), more than 65,000 students attend classes in the Loop / South Loop area.

Downtown Chicago campuses include East-West University, DePaul University, Columbia College, Roosevelt University, Northwestern’s law and medical schools, and Robert Morris University, to name just a few. One downtown student residence building, in fact, bills itself as being “steps away from 30 universities.”

Roosevelt University’s much-noticed 32-story “vertical campus” is scheduled to open early next year, and it will include on-campus housing for more than 600 students. East-West University recently broke ground on a new Student Life Center that is scheduled to open in the fall of 2013 and house more than 200 students.

If you’ve spent any time at all in downtown Chicago apartment and condo buildings, you’re acutely aware that many of the units are occupied by students. Too acutely in some cases – one condo owner told me he sold his unit after his floor hosted a 10-day long New Year’s Eve party.

Will the new university-affiliated student housing options drain demand away from the private rental market as it tries to absorb a large number of new units coming on-stream? Will they make life more tolerable for condo owners and apartment renters who find themselves unwittingly and unwillingly living in a campus atmosphere?

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{ 3 comments… read them below or add one }

the urban politician December 12, 2011 at 11:46 AM

I would agree that new university housing will acutely impact the rental market in a negative way, especially in the south loop.

But that is in the short run. In the long run, more housing of any type downtown will only improve rents, for those who are willing and able to sit and wait on their investments. Downtown benefits from there being a larger concentration of people living in the area, and that makes it a more appealing place to live.

I own a condo and rent it out to a professional, not a college student. I am a bit wary of all of the new rental and student housing towers under construction and how that will impact the rent I can charge in 2013-2014, but looking forward 10-15 years I am perfectly at ease with the demand for the space that I own.

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Simon December 12, 2011 at 7:20 PM

Other then the 1212 michigan building there is not a heavy concentration of students living in the south loop, south of roosevelt. I would say it’s minimal even. It is mostly the type of people that you rent out too i.e.professionals. I would say that it will have absolutely no impact on the rental market.

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David December 13, 2011 at 3:35 PM

I have a feeling it will have a pretty large impact on buildings like the Presidential Towers, and that will have a ripple effect. The effect will probably not be huge at buildings not filled with students right now, but as students leave their current buildings, the supply for professionals will increase.

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