Penn State enrollment is basically flat. So why is so much student housing being built?

Penn State has reported that its undergraduate and graduate student enrollment at University Park is basically flat, but student housing complexes are being built all over the Centre Region.

So what's happening?

"We’re at the level that we think we should be at" in terms of enrollment, university President Eric Barron recently told the CDT.

In fall 2017, 45,536 total students were enrolled at University Park — 610 fewer than the prior fall semester, according to Penn State's budget office.

Currently, 14,657 students can be housed on campus, including in supplemental housing and apartments, according to Penn State spokeswoman Lisa Powers.

By fall, she said, the university anticipates having 255 extra spaces, which will be the highest number on record. That's due to the addition of three new halls — Martin, Earle and Robinson — and Brumbaugh, Pinchot and Tener halls being offline for renovation.

"Penn State allocates space for first-year students based on the university's admissions target," Powers said. "The remaining space is allocated to upper-class students."

Housing starts the semester with the 100 percent target figure for freshmen, anticipating that over the first few months of fall semester some students either won't show up or decide to leave, she said. At first the halls appear "over capacity," but the "melt" gives Penn State the opportunity to house more students who stay.

"A residential student experience involves activity both in the classroom and beyond. The critically important learning and enrichment that comes from student engagement outside the classroom often requires that students participate in those activities on campus," Penn State Vice President for Student Affairs Damon Sims said in a statement. "Consequently, the university has a vested interest in housing for students that keeps them as proximate as possible to campus and the meaningful activities found there.

"The development of housing options that leave our students living miles from campus is never appealing to me because it makes it that much more challenging to encourage their participation in the boundless valuable activities found on campus."

So for those students who either don't want to live on campus, or can't get a spot, they move downtown or to any of the numerous student housing complexes being built around the Centre Region, from The Station in Patton Township to The Rise downtown.

Looking at the numbers of new student housing being built, it definitely outpaces both student enrollment and population growth, said Jim May, Centre Regional Planning Agency director.

CRPA's opinion is that developers still think there's a market here for student housing, he said, and generally, developers are going to do a market study for their projects to get financing and make sure that the projects will work.

"We're not quite sure what's happening in the rest of the market. Our initial impression is people are just simply moving around to newer places. Maybe some of the older units are just having two or three students rather than four or more students," May said.

For a long time, there wasn't much new student housing being developed in the region, and there was a low vacancy rate, he said.

Then, about five or six years ago, after the economy started to recover, May said people were looking for new places to put their money. Institutional investors saw it as an opportunity to put money into student housing.

Additionally, he said the Centre Region's housing is older and so the new complexes being built are updating the housing stock to be more in line with students' and parents' expectations.

May said it's hard to say whether the market's been saturated yet. But he said he thinks there's still room for more growth for a least a few more years.

"This region has always had a very low vacancy rate," he said.

The vacancy rate for rental units in the Centre Region is 9 percent, but almost one-third of those are "seasonal, recreational or occasional," according to the Centre Region State of Housing Report 2016 — prepared by CRPA and the most recent available.

The majority of vacant rental units — 1,427 — are rented but not occupied, according to the report. There are 210 units that are for rent and vacant.

This story was originally published May 13, 2018 at 1:58 PM with the headline "Penn State enrollment is basically flat. So why is so much student housing being built?."