As students scramble for housing in a market so competitive that students are signing leases a year in advance, city officials continue to wrestle with a housing crisis. In 2023, Madison’s rent prices increased 14%, according to Isthmus — the largest increase for any U.S. major city.
So why are luxury units struggling to find tenants?
Madison is seeing rapid expansion of new luxury apartment complexes for the upcoming 2024-25 school year.
According to Cap Times, Dane County mayors have referred to the housing crisis as the “defining problem of our region right now,” yet these apartments are still advertising unclaimed units as they finish construction for the fall school year.
Luxury developers have offered a variety of flash sales and giveaways in recent months through social media posts, student-received emails and other promotions.
A Feb. 27 “flash special” Instagram post from Oliv, an apartment complex near State Street slated to begin leasing this fall, offered a selection of technology from AirPod Maxes to iPads in exchange for a signed lease.
Atmosphere, another apartment complex opening this fall near the Kohl Center, hosted a series of giveaways for Xboxes, speakers and electric scooters in December for people who shared their social media posts.
And Chapter, a new 172-unit complex on Park and Regent streets, gave away gift cards to students walking by local spots near campus.
Ellie Gardner, a University of Wisconsin-Madison freshman, said she found out about Chapter in September when its representatives approached her outside of Colectivo Coffee. She said they were giving away gift cards for the coffee shop in exchange for filling out their survey.
Gardner said she didn’t remain interested in the apartments beyond her initial interaction. Still, Chapter posted Gardner on its Instagram account. She also began receiving promotional texts from Chapter but ignored the messages they sent her.
Chapter has continued their marketing push for signing deals since then. A pop-up advertisement appears on the apartment’s website as of March 6 offers waived signing fees and a $1,000 Chapter gift card for people who sign a two-bedroom lease.
Are these new housing projects affordable?
UW-Madison freshman Sydney Ziemniak said she noticed the discounted leases when looking for housing last fall but still felt renting a space from luxury apartments was financially out of reach.
Ziemniak said proximity was important when searching for housing, but she was unwilling to compromise on affordability.
“I want to be able to walk to all my classes and have a convenient location, [but] it felt like every time I wanted something near campus it would just be so overpriced,” she said.
A studio apartment at Chapter currently costs $1,859 per month, $691 more than the city’s average, according to Apartment Advisor. Comparable units in Atmosphere and Oliv are over $400 above average.
Gardner said the “expensive” reputation of these apartments made her hesitant to even consider renting a place close to campus.
“It’s kind of a win-lose,” Gardner said. “It’s great that we’re building more housing for students. It's just not necessarily affordable.”
Chapter’s amenities include a fitness center, a 3D printing lab and a rooftop sundeck. At Oliv and Atmosphere, tenants have an in-ground pool and coffee shop.
But Ziemniak said she feels amenities like these are not necessary for student apartments.
“At the end of the day, you just need a place to live,” she said.
Corporate-owned developments
Many large, amenity-filled apartment spaces are owned by a select few development groups that own vast amounts of housing properties nationwide.
The Denver-based Cardinal Group Company is developing Chapter as their first rental property in Wisconsin. The Cardinal Group Company currently owns apartments in 39 other states.
Verve, another apartment under development, is owned by Subtext, a Missouri-based company currently building apartments of the same name in Nashville, Tennessee and West Lafayette, Indiana, according to its website.
Oliv is Core Spaces' second apartment in Madison. The Chicago-based company also owns the Hub, an apartment on North Frances Street. Both units are located near the UW-Madison campus.
The Madison Common Council has attempted to limit the increasing construction of luxury apartment buildings near the UW-Madison campus, but current state law prevents the city from rejecting development proposals on the basis of rent prices.
