The Journal of College and University Student Housing - Volume 43, No. 2 - 88

Kevin R. McClure * James M. DeVita * Andrew J. Ryder

housing stock, particularly as private developers near campus constructed amenities-rich
options. The states in which ASU and SU are
located both voted to restrict public funding
or financing for the construction of college
student housing. Turning to the private sector
to build new housing was virtually the only
viable option at these institutions, an option
made more attractive by the speed and flexibility granted by partnering with the private
sector. Interestingly, the state policy context
also played an influential role in the decision
to not pursue additional PPPs. For example,
ASU did not pursue a PPP in the last five years
as it continued to upgrade housing facilities
because the state system placed a moratorium
on PPPs after an especially negative experience at another institution. One reason why
this theme is important is that several interview participants at ASU intimated that, in
the absence of a restrictive state policy context,
they preferred to construct new housing facilities through more traditional means. Thus, the
data suggests that attractiveness of PPPs was
magnified due to a context in which there were
few, if any, other options.

Third-Party Entities
Confirming Lewandowski and Bielat's (2010)
observation, most of the partnerships in this
study involved third-party entities, such as
private university foundations or another
entity affiliated with a given institution. Although university personnel contributed to the
partnerships at nearly every stage of development, the contracting parties were technically
two private entities, raising some question
about the extent to which there was even a
public partner in the PPP. Third-party entities afforded institutions greater latitude in
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negotiating with private developers, as foundations and other independent organizations
are not subject to the same regulations as the
public institutions with which they are affiliated. Moreover, the creation of a 501(c)(3) organization at ASU is precisely what allowed the
financing of new housing facilities to be kept
"off the books" and, consequently, separate
from the state system's debt capacity. However,
the involvement of third-party entities sometimes brought challenges and controversy. At
UFM, a foundation-initiated student housing
development turned into an unwelcome partnership that soured the idea of using PPPs in
the future. The data shows that the success of
PPPs may depend not just on institutions' relationship with private developers, but also on
the nature of the relationship between institutions and the third-party entity that is pivotal
to the deal.

Increasing Organizational Complexity
Based on data collected at ASU and SU, there is
reason to suggest that PPPs are becoming more
complex in terms of their organizational structures. ASU's PPPs started in the late 1990s in
what the Colonnade principal called the first
wave of partnerships. During this time, according to a consultant who works with institutions
that are pursuing PPPs, "it was much, much
easier to make the numbers work" because
the projects were typically debt financed. As
a result, she explained, "In the early days, we
had developers, now operators, who really had
no one to serve but the university." By contrast,
many of SU's more recent PPPs involved real
estate investment trusts (REITs), which prefer
to use equity financing. Partnerships involving REITs are more complex, in the eyes of the
student housing consultant, because "[REITs]

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The Journal of College and University Student Housing - Volume 43, No. 2

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