In response to an on-campus housing project that was not meeting its debt service coverage, the trustee engaged The Scion Group to complete an Operational Assessment for a 419-bed purpose-built student housing community intended to serve primarily graduate students. The Property, Oasis KGI Commons, is located on the Keck Graduate Institute of Applied Life Sciences campus in Claremont, California.
The Property was initially set to deliver ready for occupancy prior to the start of the 2018 academic year. However, it opened in October 2019, missing two critical lease-up windows. The late opening and subsequent negative early resident experiences due to outstanding construction and ongoing operational issues impacted the financial performance.
Scion was tasked with identifying the key hurdles that the Property faces in terms of achieving optimal financial performance and providing a detailed property revitalization plan. Scion examined the Property from a holistic perspective that included financial performance, stakeholder feedback, management, Property condition, marketing, leasing, branding, institutional relationships, rates, and resident experience.
Scion’s process included stakeholder interviews of all parties involved in the P3 and review of construction drawings, construction punch lists (both residential and academic space), current and projected budgets and financial statements, staffing structure and descriptions, market survey, marketing plan, EMMA notices, bond issuance documents, management and sub management agreements, and monthly leasing reports. In addition, Scion’s assessment included multiple site visits with team members equipped with various expertise in property operations, construction, advisory services, and P3 developments. Ultimately, Scion produced a report that provided the Client with a detailed road map to increase immediate and long-term financial performance, address outstanding construction and operational issues in a cost-effective and strategic manner, and improve the Property’s reputation amongst current and potential residents. Scion was further engaged to oversee and administer the recommended changes on behalf of the trustee and 501(c)(3) owner.