In 1999, Eric Bronstein was a fifth-year associate at a Detroit law firm. The partners had supported his decision to move from litigation to transactional law. He was newly married. The Lions were on their way to the playoffs. Life was pretty good.
But something strange was happening. Bronstein watched as college friends and young clients started dot-com businesses and attracted high-dollar investments. Meanwhile, his value in private practice seemed tied solely to his ability to clock time and bill hours. Then he missed out on an opportunity to join a wildly successful start-up.
When the firm made Bronstein a nonequity partner, he celebrated. He quit two days later.
What seemed like an abrupt exit was a calculated risk that Bronstein had dreamt about for months. “I went to law school because I love logic and critical thinking, but I knew I didn’t want to be a lawyer forever. I knew the skills I learned early in my career could be applied to really create value, if I just found the right opportunity,” he explains. That opportunity came through his younger brother, Rob.
Rob Bronstein, then a commercial lease broker, had helped the School of the Art Institute of Chicago create its first purpose-built student housing project. As the Bronstein brothers talked, they realized a sea change was on the horizon. Millennials were about to spike college enrollments to record numbers. And those colleges lacked adequate housing options.
Buoyed by their early exposure to real estate, finance, and law, the Bronsteins drafted a business plan. The Scion Group was born. The brothers opened their first office in Rob’s spare bedroom.
Twenty years later, Scion has become the country’s largest privately held owner/operator of student housing, with nearly sixty thousand beds and $5 billion in assets under management, in partnership with investors. The company has 180 corporate employees and more than 1,300 overall. During those two decades, it has also advised more than two hundred colleges and universities.
Although Bronstein left private practice, he says that experience is still relevant to managing acquisitions, business transitions, and the occasional dispute as Scion’s executive vice president and general counsel. “I write better contracts and negotiate better deals because of what I learned in litigation,” he says. Bronstein further honed his legal skills by working as in-house counsel for a Fortune 100 automotive supplier while moonlighting at Scion until going full-time in 2006.
Today, he leads a small legal department that includes three other attorneys and four paralegals. Since Scion acts as investor, owner, and operator advisor at more than eighty properties with hundreds of residents each, his department is busy.
Each student has their own contract, and most have a financial guarantor with their own contract as well. Scion generates and executes more than one hundred thousand contracts per year. The company adapts its own custom-built electronic contracts to comply with varying state and local laws and uploads them to one centrally managed database. The system must be easy and painless for a prospective customer, yet still give the company consistency and centralized control.
Despite the high volume, Bronstein’s legal team is ultraresponsive and hands-on. Property managers are trained to send concerns about contract questions, fair housing, or myriad other issues to email addresses monitored by the legal department. The team spends many hours each week drafting issue-specific letters based on proven response models, which property managers can send out in their own names. Bronstein has worked to position his department as a trusted ally and resource, ready to provide a quick answer or ad hoc training.
“We don’t charge our properties for our time because we’re also an owner, so we see these legal services as baked into our relationship,” Bronstein says. “Our managers don’t need expensive outside counsel every time they encounter a problem, and the approach gives us consistency in brand and message throughout our large portfolio.”
The Bronsteins and their leadership team have met clients’ expectations and redefined student living. Two decades ago, college students lacked options. They typically lived on campus in aging, unattractive, utilitarian residence halls, or off campus in a hodgepodge of often-unsafe local rental housing. The Scion Group has never sought to develop new construction, but through acquisitions, it has amassed a national portfolio of upscale apartment complexes off campus, and some managed properties on campus, that offer security features, ample amenities, on-site management, shuttle buses, and other conveniences.
“We’ve studied the market and responded accordingly,” says Bronstein. “College students are looking for real communities and a distinct experience, and that’s what we provide.”
Because the company can do this at scale (Scion acquired $4.5 billion in assets between 2016 and 2018), it can deliver its services at competitive, cost-effective rates. Today, as Generation Z moves in, Scion is migrating its properties into four main brands (Alight, Lark, Redpoint, and Ion), designed to reflect the personalities of the residents and provide an identifiable experience while keeping pace with changing customer preferences.
It’s been two decades since Rob and Eric Bronstein spotted an opportunity and started Scion. They have played a key role in making student housing a respected subsector of the residential real estate market. As purpose-built on and off-campus communities become the new standard, and with an in-house legal department turbocharging its engine, Scion is poised for continued growth.
Kabat Chapman & Ozmer LLP:
“Eric is the rare combination of a skilled lawyer and advisor, a savvy businessman, and an all-around good person. That makes him an ideal in-house partner and a tremendous asset to his organization.”
–Ryan D. Watstein, Partner