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College Perks: Maid Service, Vegan Food, Debt

Tuesday, 1 May 2012 | 4:48 PM ET

This isn't your father's dorm room.

College Recruiting With Perks
CNBC's Jane Wells reports on the competition between educators as colleges are beginning to offer big perks to attract students.

Colleges and universities are pouring millions into renovating residence halls and freshening up cafeteria food. Administrators believe it can give them an edge in recruiting top students, while also improving the overall education by improving quality of life.

"Students spend 90 percent of their time outside the classroom, so when they're determining where to go to college, they really are looking for the full package," says Brian Dawson, Associate Dean of Housing and Residential Life at Pepperdine University. Pepperdine hugs the Pacific above Malibu, and the views alone may warrant a portion of the $54,000 a year it costs to attend. All freshmen and sophomores are required to live on campus, and room and board take up nearly 20 percent of total cost. "Sometimes the first impression is what's outside the classroom," Dawson says.

Pepperdine has just renovated its student center with new food and furniture, and business has tripled. "If you build it, they will come," says Dawson, "especially if they're hungry." The school is embarking on a multi-year, multi-million dollar makeover of dorms starting next year, and CNBC has learned that Goldman Sachs is backing an offering this week to raise $50 million for the school.

East of Malibu, in Claremont, California, millions are also being spent on new residence halls at Pomona College and Claremont McKenna College, two of the prestigious Claremont schools.

Pomona Hall is a new, LEED certified platinum residence hall, part of a $53 million investment in expanding student housing at that campus. Why? To help recruit top students who have several other offers.

"They're not making choices on, 'Am I going to get a good education at Pomona or not?' because they can get that any many other schools," says Seth Allen, Dean of Admissions in Financial Aid. Pomona's been cited for having palatial dorms by the Princeton Review, and senior Jeff Levere is a fan of the new, "green" residence hall. "I like the common room," he says while watching ESPN inside his spacious two-room suite.

Across the way at Claremont McKenna, administrators are planning to renovate five dorms starting next summer. "I think colleges are trying to be very mindful of it being a living environment, as opposed to just a dorm," says Assistant Dean of Students and Director of Residential Life, Eric Vos. Room and board costs up to $14,000 a year.

"I absolutely love it," says junior Caroline Nyce of her room in the recently completed Claremont Hall. "It's quiet, it's comfortable, when it's really hot outside we have really nice air conditioning."

One other perk—students at any of the Claremont schools can eat at any of the other campuses. Dining halls compete with each other for the best offerings, focusing on fresh, organic, locally grown foods. Up to one in five students claims to be vegetarian.

Roommates Kevin MacPherson and Kevin Sullivan, both seniors at Claremont McKenna, were busy one Monday morning debating where to eat lunch, and settled on steak at Pitzer College. "We're extremely spoiled here, it's like a vacation," jokes MacPherson. "My mom says, 'You have better food here than you do at home with my cooking'" says Sullivan, a senior bound for Wall Street, where he hopes to earn enough to pay off his student loans. "I see it as an investment in the future."

Brian Dawson, Pepperdine University
Brian Dawson of Pepperdine University explains the reason for investing millions in better dorms, as students discuss the perks and their own debt.

Research by William Blair says over the last decade, costs at private four-year institutions have risen about 2.5 percent annually on average, less than half the rising cost at public four year schools. In California, state school costs have skyrocketed double digits over the last two years as the state's lingering budget crunch has cut money off for higher education.

Still, going to state school UC Berkeley still only costs about half what it does to go to Pepperdine or the Claremont colleges, causing private schools to continue to invest in perks to help them stand out.

Even at Pepperdine, the improvements continue. Students are surrounded by vistas only the 1 percent can afford, so why put capital into fancy dorm rooms? "It's not daylight all the time," Brian Dawson says.

"The location doesn't hurt," says freshman Sawyer McGale. "I have a window right by my bed with an ocean view," says sophomore Gina Choi. The residence halls have made service and some have new, communal kitchens for students who want to cook.

"Coming here I realized that food and student life really plays a factor, because you're here for four years, so you've got to make the most out of it," says Andre Baesa, a junior studying international business. He admits his student loans worry him. "When I graduate, I'll have to be paying off loans...but I'm still in school now, so I like to take it a day at a time and worry about that when I graduate."

Pomona's Jeff Levere graduates soon and heads to Macquarie, where he will be an analyst, a skill he brought to choosing a school. "When I went to choose colleges, I went and ate in all the cafeterias that they had, because that was something that was really important to me," he says. "I was not a fan of Tufts food."

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