Boston College is revamping the biggest dorm on its campus as a part of a sequence of capital tasks amid the varsity’s surging enrollment.
Boston College’s 60-12 months-Outdated Dorm Will get $663 Million Improve
The varsity plans to faucet municipal-bond traders for $300 million in early March to finance the primary part of what’s anticipated to be a $663 million overhaul. The brand new mission will outfit pupil rooms with upgraded finishes, lighting and air-con, in addition to enhance a eating corridor, based on preliminary bond paperwork.
Constructed within the Nineteen Sixties, the buildings, which take up a swath of Commonwealth Avenue, have grown a “bit tired” over time, stated Colin Riley, the college’s government director of media relations. Different tasks embody a brand new heart for computing and knowledge sciences.
Schools throughout the nation have been speeding to the capital markets to safe lower-cost financing to improve educational buildings, pupil facilities and dorms in a bid to lure college students to their campuses. Final 12 months, faculties bought $26.7 billion of muni debt — a lot of it to assist enchancment tasks.
“This is a completely different campus for the alumni who attended school a generation ago or so,” stated Riley. “Students expect a little more now.”
Newer services are vital to schools which might be vying for a smaller pupil base after a slowdown in US birthrates through the Nice Recession. The variety of 18-year-olds graduating highschool annually will decline 13% by 2041, based on estimates from the Western Interstate Fee for Increased Training.
Not like different faculties, which have been struggling to attract college students, Boston College acquired practically 79,000 functions for a 3,300-person freshman class final fall. Its acceptance charge dropped to roughly 11% in 2024, in comparison with about 50% in 2011, based on college knowledge. BU’s enrollment has additionally been rising, with full-time equal headcount up greater than 12% from 5 years in the past, to 30,253.
Whereas some traders have been cautious on higher-education debt due to elevated ranges of misery, patrons have snapped up investment-grade securities bought by BU.
The varsity priced $284 million of debt earlier this month to refinance excellent obligations. Ten-year bonds in that transaction had been bought with a 5% coupon and three.03% yield, about 5 foundation factors greater than top-rated securities. That’s roughly 10 foundation factors tighter than spreads provided in pre-marketing, based on early pricing wires considered by Bloomberg.
That sale was additionally up-sized by about $120 million, one other indication of sturdy investor urge for food, the wires present. A spokesperson for Barclays Plc, the underwriter on the deal, declined to remark.
“It’s one of those names that you would buy and put away because they don’t come to market very often,” stated Chris Lanouette, a Boston-based managing director and portfolio supervisor at CIBC Non-public Wealth Group LLC.
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The brand new deal for the dorm upgrades will likely be bought as variable-rate securities, that means the interest-rate on the debt will reset periodically. Moody’s Rankings gave an Aa3 long-term ranking on the bonds, the fourth-highest accessible.
“Excellent student demand and very good enrollment diversity will continue to support significant pricing power and steady revenue growth,” analysts at Moody’s wrote in a report.
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Annual tuition on the faculty clocks in at $66,670 for an instructional 12 months, with housing including one other $12,180. Based on BU’s web site, complete estimated bills add as much as simply over $87,000.
The Warren Towers renovation will likely be accomplished in phases, with the primary section beginning this 12 months. Every tower will likely be taken offline for about 15 months and the total mission needs to be completed by the summer season of 2028, based on to the varsity’s web site.
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Riley, the varsity’s spokesperson, doesn’t anticipate issues with housing college students through the renovations. He stated there are many locations for undergraduates among the many college’s residences.
Nonetheless, BU is housing 135 college students in a Hyatt resort due to elevated curiosity in residing on campus, he stated.