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College is expensive — even if you don’t go.
The University of North Carolina at Chapel Hill is building a new dorm for the first time in decades, and taxpayers are footing the $110 million bill. The project will include two buildings for 700 students in the area of Jackson Hall on the north side of campus.
To some, that price tag feels steep.
For comparison, Raleigh’s FNB Tower, a 22-story luxury skyscraper on prime real estate with 239 apartments, retail, office space, a gym, yoga studio, outdoor pool, and a dog-washing station, cost $116 million when it was built five years ago.
The last time UNC built dorms on its main campus was back in 2002. That project produced four dorms housing a combined 960 students for about $47 million. Today, 20 years later, UNC will spend more than double the money to house about two-thirds as many students.
Even UNC trustees expressed concern.
“We were kind of shocked with the pricing being over $100 million for 700 beds,” said Marty Kotis, who chairs the university’s Budget and Finance Committee and works professionally in real estate development.
The math breaks down to more than $150,000 per bed or more than $300,000 per dorm room, since most are doubles. It’s close to the cost of buying a home in the Triangle. Triangle MLS data shows the median sales price was $424,700 in August 2025 for central North Carolina’s 19 counties.
Kotis said the rising costs are partly due to regulations.
“We talked about a need for reform and regulation regarding some of the requirements that are imposed on the university by state and federal regulations and how that can drive the cost higher,” he said.
Among those costs are LEED-certified green building standards and participation from the Office of Historically Underutilized Businesses [HUB], which requires a portion of the work to be done by minority-, women- or disabled veteran–owned businesses.
Additionally, UNC says it takes a 50-year approach to construction, which means spending more on materials and design up front to ensure durability. This is a higher standard than most private projects.
But Kotis pointed out one major difference from the private sector is how public institutions negotiate costs.
“In the private sector, you might meet with a variety of contractors and architects and discuss how to cost-effectively build your project,” Kotis said. “In the public sector, you don’t discuss pricing much at all. You don’t discuss their fees.”
It’s part of a system called “qualification-based selection.” Universities hire teams before negotiating price. Since UNC sets its budget based on past university projects, at Chapel Hill and elsewhere, the price isn’t set by local demand. It’s based on what other schools were willing to pay.
Institutions help create and control the market and then use it to justify costs.
“The numbers were just kind of ‘funny numbers,’” Kotis said. “They weren’t really tied to the market.”
However, UNC maintains that it’s staying on trend with national benchmarks. The university shared a document showing other dorm projects with similar costs, including a $33 million dorm at Virginia Tech, a $118 million dorm at the University of Texas at Austin and a $326 million project at the University of Florida.
While dorm construction may be getting more expensive, it’s also getting more competitive. Many new buildings include more than study lounges but maker studios with 3D printers, design software, virtual reality suites, art studios, gaming rooms and mindfulness centers.
“It is a Taj Mahal mentality,” Kotis said. “Other schools have a climbing wall, then you need a climbing wall. Other schools have a sushi restaurant, then you need a sushi restaurant.
“it has become a little bit too much.”
All of this comes as families continue to struggle with the broader cost of college.
The annual cost for in-state undergraduate students for the 2025-26 school year is $27,766, according to UNC’s website. It includes the cost of tuition, fees, housing, food, books, supplies, travel loan fees and personal expenses.
UNC offers financial aid, but the cutoff for full support can be lower than expected. Families earning more than $100,000 per year often pay full price without other scholarships.
Consider a family of five earning $125,000 each year. After covering mortgage payments, cars, insurance, kids’ sports, braces, medical bills, property taxes, retirement and everything else, saving $300,000 for three children to attend UNC could feel out of reach.
The North Carolina Constitution states that “the University of North Carolina … as far as practicable … be extended to the people of the State free of expense.” That clause is interpreted to mean public higher education should be as affordable as possible.
To the university’s credit, tuition hasn’t increased in nine years. UNC is consistently ranked as one of the most affordable public universities in the country. In 2023, the school reported that 73% of undergraduates graduated without any student loan debt compared to a national average of 45%.
Data from the Education Data Initiative shows the average student loan debt may be as high as $42,673 in the U.S. In North Carolina, the data shows the average federal student loan debt is $38,929 in North Carolina.
Plus, many Gen Z borrowers say it’s delaying their ability to get married, start families or buy homes.
As for the $110 million dorm, it may not be an outlier. The university says inflation and construction costs have risen 2.3 times since 2002. Adjusted for that, the 2002 dorm project would cost $108 million today, almost identical to the new one.
Have thoughts on this topic? Email Dan Haggerty at Dan@wral.com.
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