MIT Ready To Set Rent For NW30
GSC, Deans Debate Over Cost of LivingBy Rima Arnaout
Deans will meet with graduate students today to set the rent for Building NW30, the warehouse on Albany Street that is currently being converted into a graduate dormitory for first-year students this fall.
The meeting is one step in MIT’s effort to provide graduate students with affordable housing in the face of ever-increasing prices in the local housing market.
Dean for Student Life Larry G. Benedict, along with Dean for Graduate Students Isaac M. Colbert and members of the Housing Office, will give the official figure at the end of today’s meeting, Benedict said.
Grad students push for lower rent
According to Graduate Student Council President Soulaymane Kachani, who has taken part in preliminary conversations about NW30’s rent, the price considered so far for its one-bedroom efficiencies is about $850 a month.
“First-years cannot afford that. First-year stipends are significantly lower than those of senior graduate students,” Kachani said. As of July 2001, a first-year graduate student will receive a stipend of $1630 a month, Kachani said, while a senior graduate student will get $1800 a month.
Benedict said that NW30’s status as a home to first-year students is a factor in the decision-making process.
“Larry Benedict has been very responsive. We hope that we will get a final rent that is based on stipend levels,” Kachani said.
Director of Housing Operations Karen A. Nilsson said that MIT feels responsible “to offer a good product and a safe, secure, well-maintained place to live.”
Rent for all grad dorms will go up
The Housing Office has already announced a five percent increase in graduate housing rents across the board, beginning in the fall.
Currently, Edgerton House is the one graduate dormitory that has efficiencies. The rent for those rooms is scheduled to increase from $828 to $850 a month.
Setting rent for NW30 is only one facet of how MIT is responding to the challenge of housing graduate students in the context of a housing market in which rents have been rapidly rising.
In past years, MIT had set a policy to provide graduate housing at 90 percent of the market rate, Benedict said. “That was going to be the benchmark,” he said. “But in the past five to seven years, rents have skyrocketed” while MIT rents have not followed as quickly.
Right now, Nilsson estimates MIT prices are “somewhere at about 70-80 percent fair market rate, compared to apartments in the metro Boston area.”
One “goal for the coming year is to establish a rational rent structure,” Benedict said. “My staff and I have been working on some alternative models establishing rents for NW30. Since I’ve been working with the GSC, I wanted to meet with them first before getting feedback from the community.”
“It’s looking like 90 percent won’t be realistic, but it’s not clear,” Nilsson said. “It seems like the market may start coming down.”
Redefining grad rents complicated
In figuring out a new benchmark for graduate rents that makes sense in today’s market, both Benedict and Nilsson explained that many complex variables come into play. “It’s more an art than it is a science,” Benedict said.
The primary considerations in setting up a rent model are “clearing expenses, providing a sensible price in relation to other grad dorms and the housing market, and maintaining the graduate reserve,” Nilsson said.
While funding for undergraduate dormitories is part of MIT’s capital campaign, Nilsson said, graduate housing is financed by loans or floating public bonds. “Sometimes a donor comes along, but normally [these loans] are paid for by graduate rents,” Nilsson said.
Rents also pay for each dormitory’s operating expenses, such as repairs, supplies, and labor. “We look at the special projects each building needs,” like kitchen renovations in Ashdown, Nilsson said. Anything left over is put into the graduate reserve, which is used for large projects, new construction, and paying back loans on old construction.
“We also look at where people are living off campus,” Nilsson said. The Housing Office regularly gets listings from landlords in the city for the prices of different types of apartments.
In comparing different apartments, Nilsson notes that “NW30 is new construction, so we take into account what the dorm will offer.” Each efficiency has its own bathroom and kitchenette, and is fully furnished. All utilities, including local phone service, are included.
MIT plans to use NW30 for conference space in the summer. “We look at conference use as another revenue source,” Benedict said.
Kachani said that some of the cost for the $26 million dormitory arose from deferred maintenance because MIT did not maintain the warehouse in previous years. “The cost of the building is $26 million,” he said. “However, how much of this $26 million is deferred maintenance of this building? One has to separate the two and only use the construction costs as an input to the revenue model.”
NW30 to be ready in the fall
Nilsson is excited about the new space for graduate students. “This is a real plus,” she said. “MIT hasn’t added to its housing for graduate students in ten years.”
Currently, MIT is only able to house 30 percent of its graduate students, with about two-thirds of those students living in graduate housing and one-third in undergraduate housing as graduate resident tutors.
Yet “by putting NW30 on line, we can increase the number of grad students we can house on campus,” Nilsson said, “and when we get Sidney-Pacific we will be able to house 50 percent of grad students on campus, and that will be a wonderful thing,” Nilsson said.
Scheduled to open in the fall, NW30’s 120 beds will be included in this year’s graduate housing lottery that ends May 1.
Kachani, a member of the Sidney-Pacific Founder’s Group, said that the group will recommend rents for Sidney-Pacific’s 650-700 beds within the next three months.