Syracuse residents see opportunity, risk in the upscale student housing boom
Andy Mendes | Design Editor
For citizens who have led, observed and revitalized the city of Syracuse for decades, the development of private student housing is another chapter in a story about the city’s housing market, which has been subjected to the push and pull of the University Hill tide.
But the rate at which the industry is growing has raised concerns among community members that Syracuse is approaching a tipping point between opportunity and instability.
The city, which had eight existing student housing properties at the time, saw a wave of development proposals at the end of 2016: 263 beds with Studious Apartments on Genesee Street and Walnut Avenue; 604 beds with The Standard on University Avenue and Adams Street; 581 beds with the 900 East Genesee Street project; 245 beds with Campus BLVD and an unavailable number of beds with Varsity BLVD on South Crouse Avenue. Since then, three projects have been approved by the Syracuse Industrial Development Agency to add 1,240 beds to the city by the 2018-19 academic school year.
Syracuse isn’t currently reviewing any other student housing proposals, but Axiometrics, a national housing market research company, projects continued growth on a local and national basis in the next year. City planners believe the housing shift can balance the university neighborhoods while some residents feel developers are adding beds faster than the student population is growing. The change, local tenants fear, will vacuum students from the university area neighborhood and leave vacancies in their wake.
“What really is the concerning element right now is that there are seven, eight, nine of these developers coming — all with the same product, all at the same time,” said David Mankiewicz, who came to Syracuse in the late 1970s to work with the Metropolitan Development Association, which would later merge with the Greater Syracuse Chamber of Commerce to become CenterState CEO. “So the question is: How deep is the market? Where are the students who are going to fill all that space?”
Mankiewicz, president of the University Hill Corporation, fears the consequences an overbuilt student housing market will have for the city because he has already seen what happens when the market isn’t deep enough. The corporation is a nonprofit organization that helps guide long-term economic sustainability in the areas surrounding Syracuse University, State University of New York College of Environmental Science and Forestry and SUNY Upstate Medical University.
Early on in his time in Syracuse, Mankiewicz saw vacancies plague the downtown corridor after a surplus of office buildings were constructed — disinvestments he said took the collective efforts of the Syracuse community 30 years to fix — and watched downtown bleed retail when shopping malls surrounded the suburbs of Syracuse heading into the 1980s.
“In a city the size of Syracuse, it takes forever to fix those mistakes when we overbuild. So that’s my fear here. We’re going to do it for the third time. We’re going to do it to ourselves,” Mankiewicz said. “The result is going to take us back, and I don’t know how many years it will take to fix what’s left behind of the neighborhoods.”
In an effort to better gauge the student housing market in Syracuse, SIDA commissioned Camoin Associates, Inc., an economic development planning company, to assess the state of the market with consideration for the developments on the city’s horizon.
Honora Spillane, the executive director of SIDA, said the study was commissioned after the agency anticipated that developers would apply to SIDA for benefits.
“The main takeaway was that while at SU, Le Moyne (College) and ESF, the undergraduate populations are anticipated to stay relatively flat — there is a demand in the market for a higher quality residential off-campus unit,” Spillane said.
The final report, which came out in November 2016, found there is a demand for higher quality units with more amenities, but the arrival of the new units would draw student renters in adjacent city neighborhoods to the new developments and make a void in demand for the vacated units.
“We hope — we think that there’s a market demand that will encourage these units and (developers) do, too. No one is spending the amount of money these projects are spending without doing their own due diligence,” Spillane said. “We hope if there’s competition in the market, that’s going to raise some of the standards potentially, then maybe we have higher quality, better housing stock all around.”
Jared Hutter, co-owner of Syracuse 727 LLC, the landlord and developer behind the eight-story mixed-use student housing development pending construction on South Crouse Avenue, said the student population growth rate doesn’t concern the development company.
“We’re not building these massive, mega-projects. We’re building boutique-style buildings at the best locations,” Hutter said. “We’re not building 500-600 beds at a location students may or may not want to live at. Time will tell.”
Hutter also said the increase in student development projects opens up the chance for the city to encourage local property owners to renovate university-area homes and ultimately turn them back into single-family houses and attract more people to the city of Syracuse.
The University Neighborhood Preservation Association has started to facilitate conversations between community organizations and landlord groups in hopes that some properties may be able to be converted back to owner-occupancy. David Michel, president of the UNPA, said the increase in student housing development presents an opportunity to restore balance in the neighborhood.
Barry Lentz, who has been a homeowner in Syracuse since 1983, said the housing developments are pulling students out of rental units in residential neighborhoods now and that the city’s approach to these developments on a broader scale plays a role in the interaction.
“It’s a simple logic issue. If the population is steady and you’re adding housing units, what does that mean? It means some units along the line are going to go empty,” Lentz said. “Because Syracuse and Onondaga County are starving for resources, they generally stake the approach that all development is good — that anything that increases development activity is a net good. That’s a very shortsighted view.”
Jean Kessner, a Syracuse Common Councilor At-Large and chair of the Neighborhood Preservation Committee, lives in the university area and said the effects of development are starting to surface.
With the increase in luxury housing as a national trend, fewer students who move off campus are living in neighborhood houses, Kessner said.
“There are a number of houses and apartments I’ve never seen vacant that are vacant,” Kessner said. “So that sets up a whole different dynamic. We don’t have enough population to absorb these.”
“A lot of this is anecdotal — that we’ve seen an increased number of vacancies over the past few years,” said Eric Persons, the associate vice president of government and community relations at SU, at a Neighborhood Preservation Committee meeting about local student housing impact in January.
March 2017 data from the Syracuse Department of Neighborhood and Business Development’s monthly parcel download shows vacant properties have decreased in the University Hill, University Neighborhood and Westcott neighborhoods since 2015. The data shows 38 vacant dwellings, or physical structures, in 2015 and 2016, with 29 dwellings currently vacant between the three neighborhoods.
“You can go through the neighborhood, you can see vacancies and that could be a result of additional housing on campus or students finding housing elsewhere — there have been some shifts,” Persons said. “That speaks to some of the demand changes that we see. Students wanting newer, better increased housing moving closer to campus, leaving other properties closer to Westcott and Lancaster (Avenue) — where we’re seeing some additional vacancies.”
When the first housing developments went up in Syracuse, local landlord Ben Tupper said residents thought the projects would usher in the end of the “great university neighborhood.”
But Tupper, who owns 70 houses in the university neighborhood, isn’t worried about the structures anymore: The upscale prices of the housing developments have made his properties more sought after among students.
“Everyone’s freaking out and I’m not freaking out,” said Tupper. “The reason why is real simple: The more places that have been built, the more new luxury places that pop up and are available, the faster every year I have rented my houses.”
The average monthly rent for the off-campus developments in Syracuse is about $1,150 per bed, according to Axiometrics. The median rent in the university area is $634, per the housing analysis report commissioned by SIDA.
As the University Hill cluster approaches a new academic year, Syracuse Mayor Stephanie Miner has discussed the student housing impact with developers and landlords, but said none of them have expressed concern about the new facilities being built.
“I am worried about it because I worry about the balance,” Miner said. “If you were to pull all of those students out for the luxury apartments that are being built, you have a real vacuum. I’m not sure where the tipping point is, but it is something I’m keeping an eye on.”
Published on March 28, 2017 at 11:41 pm