Several housing complexes that have housed BYU-Idaho students for many years as part of the university’s approved apartment network are preparing to move away from the network and sell individual units as apartment.
Are condo owners going this route and does it create a market that seems like the best option for some owners?
Earlier, the owner of two Rexburg apartment blocks, Brigham’s Mill and University View, received a move-out permit from Rexburg City Council, opening the door to exiting the university housing system and selling the apartments. single.
The third complex, The Roost, had units available for sale through various bidding services and posted outside advertisements for the apartments, but Rexburg Zoning and Planning, Alan Parkinson, did not start. Begin the necessary apartment exchange process with The Roost’s permit. .
Root did not respond to requests for information.
Eric Mattson is one of the owners of Abri Apartments, part of the BYU-Idaho Accredited Housing Network. In his opinion, the owners are leaving the market because they don’t have a better option.
Mattson, who works for a real estate investment firm in Portland, says there’s nothing like the Rexburg market in the country, and it’s the only one that’s really lost money.
According to the Student Housing and Life page on the University of BYU-Idaho website, the overall occupancy rate of approved student housing for the spring semester of 2022, which ends in July, was just 71, 3%. The occupancy rate for the next semester in the fall of 2022 is over 92%.
Rachel Fullery, president of the BYU-Idaho Off-campus Housing Association, supports Uptown’s efforts to exit the student housing market. In a letter to Rexburg City Council in April, Wholery backed University View owners’ desire to change the number plates to sell them as condominiums, which was ultimately approved.
According to Wholery, that adds up to more than $95 million in assets “almost half the idle time per year.”
Mattson said most of the property market around the country is hot and nobody cares, with apartments in Abrey for sale.
“People are looking for information, but once they start seeing all the problems they’re dealing with, they won’t want to buy,” says Matteson. “It’s a very challenging market.”
Mattson said some of the issues holding back potential investors is that BYU-Idaho has a lot of control over the assets and could terminate the deal at any time.
“How do we make money in a market that doesn’t really understand supply and demand, where universities tell us what to do with assets and threaten to take us away if we make a mistake?” .” shown? Matteson asked. “The banks won’t lend because the university can unilaterally kick us out of the system.” “
Grant Collard owns the Redstone Residence, which owns several homes in Rexburg. Collard said Redstone has no plans to leave the BYU-Idaho-approved housing market, but he understands the challenges homeowners face.
Collard argues that student housing has been over-built and there are not enough registrations on campus to sustain apartments for most of the year. Meanwhile, the housing market is “burning out,” he said.
Both Collard and Mattson agree that the market’s troubles may be temporary.
“I think the housing boom is going to be short-lived and interest rates are going to have a big impact on demand,” Collard said. “I believe BYU-Idaho will continue to learn, new projects rarely start (due to land costs, construction costs, and high interest rates) and property owners are satisfied with their investment. We have decided not to move Rexburg for a Stone-owned project in Rexburg, which has been converted into a condominium.
Matteson wants the university to help restore the health of the student housing market.
“I think the university was aware of the problem and wanted to fix it,” Matteson said. “We want to be a good partner with the university. We love the property and the location. But we can’t just stay there and reinvest in the market in the current situation.”
BYU-Idaho officials did not respond to a request for comment.
Rexburg District Attorney Steven Zollinger said that while the city recognizes that student housing is important in Rexburg, it is not the city’s responsibility to regulate the market.
“The city has a small role to play,” Zollinger said. “We have very little control over how people use the property. Our goal is to allow any use that doesn’t harm the public or adjacent property.”
While renovating the apartment, the city is responsible for ensuring the infrastructure and parking needs are met, Zollinger said, but owners have no say over what to do with the property.
“The City of Rexburg is concerned with managing the city’s infrastructure needs for all who live within our borders,” Zollinger said. “How private property owners use their properties within the parameters established by zoning is a property rights issue that the entire city must be careful to avoid.”
Some BYU-Idaho students complained of being asked to leave their homes in April, after Brigham’s Mill received City Council approval to transfer the home and sell it to owners under apartment type. Guillermo Lemus, a Brigham’s Mill resident, who has a contract to live in the complex until September, said residents who choose to stay in Brigham’s Mill will eventually be able to reach an agreement with the property owner prior to the contract. expired coin.
