Dive Brief:

• Corvias Campus Living – USG, the project-specific concessionaire and manager of a portfolio of student housing properties as part of a public-private partnership with the University System of Georgia, announced last week it has commenced a Chapter 11 process, according to a news release.

• The Warwick, Rhode Island-based student housing operator said the decision came after “extensive, multi-year efforts to make the program with USG's Board of Regents financially viable,” and the bankruptcy decision was an effort “to restructure the partnership and achieve a long-term solution for the program,” according to the release.
• Corvias’ student operation is part of a larger company that provides military housing, energy management, construction and design services, asset management and financing. The bankruptcy pertains only to CCL-USG. “No other entity is included in the proceedings, and all Corvias businesses are operating as usual,” the company said in the release.

Dive Insight:

CCL-USG operates student housing properties at nine USG campuses, including:

• Abraham Baldwin Agricultural College.
• Armstrong Campus of Georgia Southern University.
• Augusta University.
• College of Coastal Georgia.
• Columbus State University.
• Dalton State College.
• East Georgia State College.
• Georgia State University.
• University of North Georgia.

In the release, CCL-USG said the student housing program in Georgia was “no longer sustainable” as currently structured. The University System of Georgia didn’t reply to Multifamily Dive’s request for comment.

“The operating landscape has shifted dramatically since the partnership was formed and, in response, CCL-USG has gone above and beyond its contractual requirements — even forgoing its management fee for all but two months over the past five years,” Corvias said in the release.

The firm pointed to the impact of COVID-19, an escalating cost environment and lower-than-expected housing revenue and student occupancy across Georgia's University System as reasons the student program was operating at a significant loss.

“Despite previous attempts led by CCL-USG to work collaboratively on a solution that would make the partnership viable now and into the future, progress has not been made,” Corvias said in the release. 

CCL-USG said it views restructuring as the “best way to drive toward a long-term solution while protecting and maintaining” the program for the benefit of the residents who rely on the firm.

“CCL-USG is now turning to a proven legal process with the objective of returning this student housing program to financial viability through constructive engagement with the BOR and holders of notes issued by CCL-USG in connection with the project's 2015 launch,” the firm said in the release.

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