UC Berkeley to collaborate with private developers for student housing projects

The Anna Head Residence Hall, located at 2538 Channing Way, is set to open in late summer.
Ashley Chen/Staff
The Anna Head Residence Hall, located at 2538 Channing Way, is set to open in late summer.

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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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  • Twillmonkey

    Yo!  Can we have the pseudo spelling of offensive words deleted, please?  Thanks so much.

  • CAtaxpayer

    This makes absolutely no sense,  how can it be less expensive to have
    someone else to the work?  Consider it as simple as making and baking a
    cake, which of these methods is less expensive?
     1. You purchase the 
    ingredients and bake the cake in your own oven at home? or 2. You hire a professional baker, who either owns or rents a bakery,  employs other people to buy ingredients and bake your cake in the bakers professional oven?
    Even the word collaborate, sounds expensive. 
    Everyone should be tightening their belts at a time like this,  not just students, their parents and California tax payers.

    • Guest

      It’s less expensive for a private developer to do the work because they are much more streamlined with much less bureaucracy.

      • CAtaxpayer

        Actually the definition of private is: keep secret or restricted: not for other people to see or know about

    • Berkleyans are complainy

      CAtaxpayer, you really don’t understand much about business. It is nearly always less expensive to outsource everything but your core business. For the university this means that they should focus on teaching students and the management thereof, but all other services like accounting, IT, marketing, building maintenance, landscaping, and indeed building or housing development are probably delivered at a better quality against a lesser cost if this is done by external companies, who’s core business is one of these services. The fact that the University actually has/had their very own building architects on UC payroll has probably cost a lot more and resulted in less optimal outcomes than if they went with specialized builders to begin with.

  • Boltgun4slavecattle

    Bend over for money cawk! Bu-CAW!

    Can we even choose which is most ludicrous? Is it …
    1. The monopoly that the university is going to grant to the developer?
    2. The market-distorting effect of the government subsidy?
    3. The fact that there hasn’t been a real market in decades, due to all the zoning and rent control restrictions?
    4. The fact that if the restrictions were done away with this place would look like Tokyo or Hong Kong because that is the density that the demand actually supports?
    5. The fact that everyone knows that #4 is the truth and that the only way rents will ever fall is if #4 happens, but they either have an incentive to deny it (b/c they own existing property that is made all the more valuable with the current restrictions, or better yet are an “affordable housing activist”) or they think magic unicorns will fly out of some politician’s butt and make it all equal and just?  
    6. The fact that it’s not going to be “affordable” housing no matter what the university or the developer say?
    7. The fact that the contractor will cut corners and do shoddy work that will have to be rehabbed in 10 years?
    8. The fact that in the end the product is basically a more comfortable prison cell that inspires no loyalty, no larger community tie, and no sense of ownership or responsibility from its occupant?

    This is what happens when you think you are God – you pledge greater loyalty to your job or your piddling institutional bureaucractic role than to reality, and you suck the money cawk because that’s the incentive laid in front of you. You suck the money cawk and think you’re God delivering the fruits of affordable student housing and correcting the flaws of the wider world while you ignore 1-8 above and tell yourself you are doing good. This is you, Berkeley planning bureaucrat.

  • Guest

    “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 board rates stable for 3 out of the 4 years.”     Market rate for what? University dorms? Or general housing (because for the amount of space you get, dorms are clearly not 10% under general apartment rates)

    • Papa Bear

      Are you comparing all in (room & board)?

      • Guest

        Is there a “market” for room & board dorms? Is there anyone competing with the university to provide that? (maybe the coops, which are about half the price anyway, meaning you save $800 or so a month… you only have to do workshifts for about 20 hours a month, much less than how long you’d have to work on a job just to make the difference)

    • Guest

      The reason UC Berkeley Residence Halls are so expensive  is because the fees charged contain a “return to aid” portion that the university then grants to students who already have their tuition covered by Cal Grant under Blue and Gold.
      http://www.usnews.com/education/best-colleges/the-short-list-college/articles/2011/09/20/10-colleges-with-most-expensive-room-and-board