Student Housing Business

MAR-APR 2018

Student Housing Business is the voice of the student housing industry.

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WHAT'S ON MY MIND March/April 2018 StudentHousingBusiness.com 126 Mind the Details When leaders focus on creating a corporate culture reflective of employees, those employees are free to focus on innovating the product. By Marc Lifshin T The student housing sector continues to be an incredibly dynamic and fast-paced envi- ronment. Not only from an investment per- spective, but also in terms of the university market opportunities, new products, players within the space, and the speed at which things change. While continuing to mature, our niche asset class remains a fun and excit- ing sector that provides residents with so much more than just a traditional "dorm" with a pool and a paint job. We're changing how students live and learn, and inherently changing the college experience. We're excited to see the sector grow and are contributing to that upward trajectory. From an institutional investment stand- point, it is exciting to see how the sector has matured. We've continued to evolve and become widely recognized as a secure insti- tutional investment. The January/February 2018 issue of Student Housing Business covered the changes in cross-border investment activ- ity and influx of foreign investment coming into the space. While there are a number of macroeconomic factors that have driven this shift, the main takeaway for me is that people are entering the space because of the success other institutional capital has experi- enced. After seeing the success of their peers, more investors are coming to student housing because it is a proven market with a track record of consistent performance. The success of the industry has brought increased competition on the development side; however, high barriers to entry make it very hard for new market entrants. Increased competition and urban densification in college towns have driven up prices for walkable, urban sites. A lot of these sites, aside from being more expensive, are not zoned for a financially viable development so the entitle- ment process can be long, arduous, expensive and uncertain. Increased development across the country in our sector and for all other asset classes has led to shortages of labor and increased construction prices. Lending can be difficult to obtain for many local developers that are talented and knowledgeable but don't have a track record to get large-scale deals done. Despite the increased acceptance in the institutional world, new developments in today's market can be as challenging as ever. These challenges are things that every new or growing sector must deal with as it matures. It creates a healthy and com- petitive economic environment that drives innovation, forward thinking and is great for the industry — "competition makes a horse-race." These changes force all of us to make a better product, to the benefit of the stakeholders, investors, universities, munici- palities and, most of all, the students. The result of increased outside investment, high barriers to entry, and a sector comprised of a growing number of players is a better product. But how do you ensure that you make a better product, constantly look for ways to innovate, and avoid resting on past successes? The answer, for Core Spaces, is our company culture. Let's answer the overarching question here, "what's on my mind?" First and foremost is making sure that our culture is strong and intact. When you invest in your culture and make sure your people are staying innova- tive, motivated and happy — the product wins. We're all working hard; it's the positive growing pains of expansion in a company and an industry. But you have to leave room for your team to stop, think and be creative. That is why the culture is so important to us. It's driven by our employees and for our employ- ees; they are our number one asset. We have created an environment and pro- cess that has a real team mentality. Everyone has a position to play, and some are better suited to certain roles than others. But at the end of the day, we're all working toward the same goal, playing the same sport and staying involved every step of the way. We don't play for the coach, the owners, the managers or even for the fans. We play for each other, for the "win" and to have fun doing it. The "win," in this case, is a successful project. Additionally, we're trying to constantly push people to branch out, outside of their primary job function or even industry. This keeps things interesting and can help fight off task fatigue, but it can also help with cre- ative problem solving and team building. If you're a software company, get subscriptions to architecture magazines and circulate them through the office. You never know where inspiration will come from, but it comes from the bottom up, not the top down. When you invest time and resources into building and maintaining a corporate culture that is reflective of your employees, it instills a real sense of ownership that is difficult to replicate in more traditionally corporate set- tings. When people feel ownership of a project or specific task, they really dig in and want to produce something they can be proud of and excited about. This leads to increased engage- ment, collaboration and innovation — which all benefit the projects at hand and the sector in general. Marc Lifshin is a company founder and a managing partner of Core Spaces. MARC LIFSHIN Managing Partner, Core Spaces " You never know where inspiration will come from, but it comes from the bottom up, not the top down. If you'd like to share what's on your mind in a future issue of Student Housing Business, please contact Randall Shearin at randy@francemediainc.com

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