In an effort to address the growing need for student housing under the constraints of continuing budget cuts for the university, UC Berkeley is considering private developers to oversee future housing projects.
The first student housing project to be considered on campus for private and public collaboration is currently planned for Southside, according to UC spokesperson Dianne Klein.
This is the first time the campus is considering the public and private delivery method for student housing. There was previously no need to weigh the financial advantages of using a private developer versus the campus having complete control over the project’s outcome, said Marty Takimoto, marketing communications director for Residential and Student Service Programs.
“Martinez Commons is … the last self-funded student housing project for us,” Takimoto said. “If the economy stays how it is … and with all the best practices to look at, at other universities who are already employing these (types of) projects, third party development seems to be the way we will continue to go.”
The plan to begin using private developers comes at a time when the campus has been looking at creative ways to save costs, while striving to meet the objectives of its 2020 Long Range Development Plan.
According to the plan, by 2020, the campus expects a considerable increase in enrollment and housing needs stemming from external research funding that UC Berkeley relies on.
In response to these needs, the campus plans to make significant increases and upgrades in housing suitable for undergraduate and graduate students, student parents and some faculty members. The new housing units proposed in the plan will be located within a one-mile radius of Doe Library, or within one block of a transit line which provides trips to Doe Library in less than 20 minutes.
The move to begin considering private developers to manage student housing projects is not specific to UC Berkeley and is already happening on other UC campuses, notably UC Davis and UC Irvine, according to Klein.
Within the UC system, the collaboration with private developers has also not been restricted to student housing. UC San Francisco’s new neuroscience building, scheduled to open this summer, is built and owned by a private developer that will enter a space lease with the campus.
UC Berkeley is currently in the stage of accepting proposals from private developers, but it plans to follow suit with UC San Francisco and have a developer receive revenue from a land lease agreement which would typically last 30 to 35 years, or essentially for the life of the building, according to Takimoto.
City officials’ main concern about using private developers for campus funded projects is the affordability of the finished units.
“If they make it condo-grade apartments, like some of the projects now, it is going to be cost prohibitive,” said City Councilmember Kriss Worthington, whose district includes the UC Berkeley campus and its surrounding areas. “Students need affordable housing even more than anyone else.”
Private developers in the city of Berkeley have numerous options and requirements in order to provide some measure of affordability for a portion of the units in their projects.
However, according to city Rent Stabilization Board Commissioner Igor Tregub, it is not mandatory for campus funded projects to align with the city’s affordable housing requirements. For that reason, he has concerns that private development will drive up the rent amounts in campus-provided housing.
“I hope that (a) commitment to affordable housing can be memorialized in some of the selection criteria the (campus) will use,” Tregub said. “I hope that a good faith effort on the part of the (campus) can be expected to preserve affordability for all or some of the units in these projects.”
Because student housing is self-supporting and its funds come directly from room and board charges, the residential programs have had to seek alternative avenues to keep student housing fees at or below their target rate, according to Takimoto.
“In general we try and design our rate structure to be about 10 percent below market rate,” Takimoto said. “In light of the current California state economy and rising tuition fees, we’ve been able to keep room and board rates stable for three out of the four years.”
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