In fact, says Tamkin, most colleges now see student housing more as a marketing tool for attracting new students to their campuses than as a sheer revenue generator; they recognize that modernized student housing can be the determining factor for students trying to decide which school to attend.

"We've found that today's students want the comforts of home but still want to feel like they're part of a larger community," says Tamkin. "For example, all of our projects now include amenities like private bathrooms, high-speed Internet access, and common study areas. It's a tricky balance between providing quality features and still keeping the cost in a range that the average student can afford, but we're finding creative ways of meeting both of these needs."

The returns are similar to other multifamily projects, but require higher maintenance reserves due to student activities and are more management intensive. The turnover is greater and occupancy is sometimes nine months, not the normal 12 months. The cost per bed as a national average is approximately $35,000, with regional variables being labor and material costs, weather and land supply. Rents can range from $300 to $700 per bed, per month.