Levine is currently overseeing the final touches on a 22-story, 75,000-sf building that will house 360 students from New York's School of Visual Arts. When it opens in January, the $30-million dorm will be one of the nation's most technologically sophisticated student-housing facilities. Unlike the Spartan cells of dorms past, the SVA building has a gym, lounge, laundry, T1 lines, network and cable connections, an internal phone system and 24-hour security.

Construction costs for dorm housing are calculated by occupant, or "pillow," rather than by the unit, as in other types of residential buildings, Levine says. "Typically, if you were to have two students in the equivalent of what would otherwise be a one-bedroom unit with 650 sf divided into two living areas, you're then talking about 325 net sf per student. That's about 375 to 400 gross sf per student. At today's costs of approximately $200 per sf, once you add in ancillary costs, you're looking at close to $400 per gross sf total development cost."

Rents for student housing "are very similar to that of ordinary residential rentals," Levine says. He adds, though, that the enhanced credit of a major educational institution can result in lower interest rates and construction costs, creating potential savings for students. "Universities are flexing their muscles in that they are bulk buyers. They bring creditworthiness that enhances the building's financial abilities. By virtue of their buying power, they are able to convey better bargains to students. And their goal is to find affordable housing and amenities for the student body."