GlobeSt.com: What is fueling this growth?

Zaransky: More and more young people are attending college and the echo-boomer generation is very large. That generation is expected to fuel an enrollment increase. At many campuses there is a shortage of student-housing properties. Also, a greater percentage of high school graduates are going for a post-high school degree.

GlobeSt.com: In what parts of the country are you seeing this?

Zaransky: It's nationwide but not equally distributed. The largest growth in enrollment is in the higher-growth states such as California and Texas. They're experiencing huge population growth in 18-to-24-year olds. Enrollment there is projected to go up higher than, say, Michigan, where there is population growth but not as much within that age group.

GlobeSt.com: How are the universities coping with this growth?

Zaransky: Public universities are under increased and severe financial pressure. Many state budgets have been cut and they operate at deficits. The crisis of availability of public funds for universities has resulted in their inability to build more dorm rooms.

GlobeSt.com: What options do the universities have?

Zaransky: An increasing number of the universities--particularly the public ones--are relying on the private sector to house students.

GlobeSt.com: How have student housing needs changed?

Zaransky: The "Animal House" stereotype of a single-family home rental is over. The amenity that is a must is high-speed Internet access. Washers and dryers on site or actually in the unit are becoming a must. I see furnished units becoming the norm. The availability of parking spots on site is a must as well. All those amenities and factors are important, but I've found that location in terms of proximity to the center of campus is the most important for leasing up quickly. As you get further out, lease ups are slower but still occur without a problem.

GlobeSt.com: Is land availability a problem?

Zaransky: It's a double-edged sword. There is a lack of availability of close-in land near most universities for new construction. But well-located existing facilities benefit from that barrier to entry. It's comforting to know.

GlobeSt.com: Is there a lot of new construction as opposed to the renovation of existing properties?

Zaransky: There is new construction. The bigger new developments tend to be farther out where students have to either drive to campus or take shuttles. Existing stabilized properties that are well-located and can be upgraded are a better investment. Our company's particular focus has been buying stabilized assets rather than building new.

GlobeSt.com: Is it difficult to work with the universities?

Zaransky: We focus on the public universities. They welcome good relationships with local landlords because they really depend on the private sector to house their students.

GlobeSt.com: What's the competition like?

Zaransky:There's a lot of debt and equity out there. Our niche is a little too big for small investor but too small for a large investor. Our biggest challenge is finding properties worth buying.

GlobeSt.com: How did you get involved in the student-housing market?

Zaransky: I'm the third generation in my family to own and operate apartment buildings. Two and a half years ago, I began to investigate the market as a developing niche. We now own a total of 650 beds at three universities in Chicago, Indiana and Florida. It's kind of a niche that everybody quickly understands because most investors were either students themselves or have sent or will be sending students to school.