When Northwestern University abruptly announced the closing of on-campus housing to most students, the phone immediately started ringing at the Park Evanston high rise on Chicago Avenue.
The Park Evanston has a normal occupancy rate in the “upper 90s,” this time of year. “But when the dorms closed,” a leasing agent told Evanston Now, “we rented 20 apartments in one day.” The 24-story building is now full.
NU’s dorm announcement, in late August, came less than two weeks before students were scheduled to move in to residence halls, and set off a scramble to find places to live.
That push helped landlords rent off-campus apartments and came as a welcome infusion of money during the financial downturn caused by the coronavirus. But apartment owners and brokers say it is far from a bonanza, and there are still plenty of questions and a lot of uncertainty.
Al Belmonte, of Wesley Realty, said “U-hauls were moving fast and furious” after Northwestern’s policy change, which banned all first and second year students from residence halls, other than a small number who received exemptions.
Belmonte estimated a “10% bump” in occupancy for his company’s buildings, which translates to about 20 to 25 units.
However, he said a lot of students “have gone home to live with mom and dad” once most of Northwestern’s classes were switched to remote learning — students who otherwise would have rented apartments.
Before the pandemic, Belmonte said he could send lease renewal notices out 90 days before the lease expired, and would get it back signed the next day. Now, he said, renters are waiting longer to make up their minds. “We get a lot of requests for two-to-three month extensions,” he said. “There’s a lot of uncertainty out there.”
Much of the uncertainty comes because it’s unclear what Northwestern will do in winter quarter. The University has said most classes will remain online, but NU is still considering whether to allow more students on campus, and potentially change the policy about who can live in the dorms.
(Before COVID, NU required all 4,000 first and second year students to live on campus, along with the handful of juniors and seniors who chose dormitory life).
Eric Paset, of Northshore Apartments and Condos, said the partial dorm closing led to “a nice little push of activity, but it was short-lived.”
Paset said the usual “huge number” of foreign students is now basically zero, and another group of renters, graduate students, is also substantially lower because of classes being held remotely. “Why would you move all the way to Evanston,” he asked, just to take courses on a computer?
Paset said landlords face a “perfect storm” of problems. Rents are lower because of the COVID-induced recession. There are still vacancies. And, a government moratorium on evictions means some rent is not being paid.
The State of Illinois has an eviction moratorium in effect until mid-October, but that ban may be extended. There is another eviction moratorium from the federal Centers for Disease Control. The CDC ban has certain income restrictions, but runs for the rest of this year.
Paset said a state program to help pay some of the rent was too little, and has now run out. “Landlords need help,” he said. “It’s a real domino effect,” because if the landlord cannot collect rent, that landlord cannot pay the mortgage.
He told Evanston City Council on Monday night that state or federal assistance is critical to help apartment building owners make it through the current financial crisis.
Not only is the economy a wild card, but landlords will also be impacted by whatever Northwestern does for the winter quarter. Will more students return to Evanston? Will they be allowed back in the dorms?
“It’s a big unknown,” Paset said.
Belmonte agreed. “Every day,” he said, ” I try to figure out where we’re going to be.”