Basketball court in a common area of a property recently acquired by GoldZone. Submitted photo.
A local entrepreneur and former Kent State student, along with a group of investors, has been buying properties around Kent for the past two years and now owns a quarter of the city’s licensed rental units.
And they’re looking to buy more.
Gold Zone Rentals owned about 140 properties in the city before its latest acquisition. On June 7, the company closed on The Genesis, a major housing complex off of Summit Street near campus. The purchase will double the size of Gold Zone’s portfolio, adding 335 apartments with 571 bedrooms, said Ben Koberna, co-owner of the company.
Gold Zone now owns 1,023 bedrooms in Kent, the company said in a news release.
The three complexes will be rebranded as Gold Zone Terrace, Gold Zone Ridge and Gold Zone Valley. The team is planning considerable renovations and new amenities for each property, including a large dog park, fitness center and outdoor fire pits.
Koberna’s rise from a Kent State piano major to the largest proprietor of student housing in the city followed a circuitous path, from finance to software, ultimately selling his startup to a Fortune 500 company. That windfall, in 2021, gave him the seed money to pivot into real estate.
“Real estate makes more sense to me than the stock market, and local real estate makes even more sense,” Koberna said. “I love Kent, both the university and the city. I’ve got three kids with special needs in Kent schools. We have a lot of support, and I feel lucky that I live where I do.”
The company is focused on off-campus student housing, targeting properties in what it deems the “gold zone” of where college kids want to live.
That corresponds to the area north of East Main Street to Crain Avenue between North Water Street and Linden Road, and across the Crain Avenue bridge, everything between Fairchild Avenue and Haymaker Parkway.
As Kent State expands westward, so does Koberna’s Gold Zone: The company is eyeing all of Summit Street between Franklin Avenue and Dix Stadium. If the roads end at campus, so much the better.
“The gold zone for us is a certain area around campus that we feel like really specifically students prefer to live in,” Koberna said. “What the students really want is a five-minute walk to campus and a five-minute walk to downtown.”
Not that he ignores properties outside that range. Koberna owns properties all over town, including on Meloy Road, where athletes are attracted to rentals close to Dix Stadium, and at a number of other outlying properties.
In interviews, two elected officials in Kent expressed misgivings about a concentration of housing in the hands of one company. But no one The Portager spoke with said Gold Zone was anything less than a model landlord. In fact, one Kent Health Department inspector said he wished the city had more landlords like Gold Zone.
Music major to major investor
After studying music from 1991 to 1996, Koberna got an offer to play piano on a cruise ship. Who knows where he’d be if he had accepted. Instead, he changed course and started work as a stockbroker for Morgan Stanley in Cleveland, cold-calling prospects 70 hours a week for little pay.
Each quarter the office would cull the worst performers. Out of 180 newbies, Koberna was among the six who survived the brutal performance regime, in part by working a connection to pick up the retirement portfolios of nearly two dozen night shift workers at a Chrysler plant.
After three years he couldn’t justify the long hours for low pay and left the company. Through a mutual friend, he picked up a job selling telecommunications contracts for Ameritech and then for WorldCom, which collapsed after its CEO got arrested and there were mass layoffs.
“Right away I was offered another gig at some other stupid telecom company,” Koberna said. But he didn’t take it. He figured he could sell contracts for himself. “I think I’m just gonna start my own business, this is ridiculous. So we started in my basement.”
He and his best friend, Scott Patterson, sold and managed phone and internet installations for a growing roster of clients starting in 2002. In 2007, they jumped on yet another opportunity. A colleague had joined a reverse auction platform, which helped public agencies put out calls for bids on vendor contracts. Koberna and Patterson started selling the platform’s services for commission.
Eventually they built their own platform and went into the reverse auction business as EasiBuy. The company, headquartered in Kent at Gougler Avenue and West Main Street, continued to grow until HealthTrust bought it in 2021.
Koberna stayed on as part of the acquisition. But the sale (he declined to say for how much) allowed him to begin a new career as an investor.
‘More power to them’
Koberna doesn’t run the day-to-day operations of Gold Zone Rentals, which also appears as Golden Flash Rentals in some records. (The company and the university worked out a deal in which Gold Zone can use Kent State’s logo in marketing materials in exchange for sponsoring the athletic program.)
Instead, property management duties fall to Paigemax Development (named after two of Koberna’s and Patterson’s kids), a Kent company run by Toby Jurging, who co-owns Gold Zone Rentals. Jurging’s team is on call to handle maintenance issues, sign up new tenants and keep the residents happy.
Kent Community Development Director Bridget Susel could only locate five minor code violations for Golden Flash Rentals or Gold Zone for things like furniture on the lawn and the size of a “for rent” sign.
One concern whenever a single company controls a large share of a market is that it will raise prices or allow quality standards to slip.
However, when it comes to upkeep, city leaders appear grateful for Gold Zone’s investments.
Kent Council member John Kuhar, who owns rentals himself, said he’s glad someone is buying up existing housing instead of building more developments like University Edge on Rhodes Road or Paloma Kent on Summit Street.
“They’re all large student rentals. If somebody takes it on themselves to buy smaller student rentals, which are a lot more work, what can you say?” he said. “The landlords in Kent have been having such a rough time with some things that a lot of them are bailing out. If [Gold Zone] wants to buy up all the houses and deal with all the problems, more power to them.”
Koberna says it’s his goal “to confound the expectations that landlords are trying to squeeze every dollar out of every house” by converting them into desirable dwellings with a consistent brand.
“We hope we’re redefining this asset class. We want to run them professionally and invest in them as a long-term asset,” he said. “We think we can improve the safety, the conditions and even the aesthetic look of these properties, which we think are an important part of Kent’s local community.”
Kent Council member Roger Sidoti, also a small-scale landlord, knows Kent’s government can only control zoning, not who buys a property or how much they charge for rent.
A large-scale landlord can easily push up rent prices. “And what happens is that good, decent people who may be families, maybe a mom, a dad, and a young kid, they’re trying to save money to eventually buy a house, they can’t afford to rent, either,” Sidoti said.
But none of that has happened. Gold Zone’s rental prices are toward the bottom of the price range for off-campus housing.
Koberna says Gold Zone’s average per-bedroom price point of $575 is below every Kent apartment complex and cites an analytical study Kent State business students recently conducted.
The students surveyed six of Kent’s larger apartment complexes: 345 Flats, The Province, University Edge, Pebblebrook, Paloma Kent, Campus Pointe and Eagles Landing.
The average rent in 2023 for a one-bedroom apartment is $728. Two-bedroom apartments go for $918, three bedrooms cost $1,187, and four bedrooms are renting for $1,471. Studio apartments rent for an average of $424 a month, the students learned.
Even at those prices, the students found that the apartment complexes’ 1,475 total units were 97% occupied.
On-campus prices are higher.
According to Kent State’s University Housing office, on-campus rates for the eight-month 2022-23 academic year range from $3,890 per semester for a double dorm room to $5,578 per semester for a single apartment, with an array of amenities affecting each price point.
Since the academic year is eight months, that translates to $972 to $1,394 a month to live on campus. And as it does every year, the university plans to review its prices in June.
The MBA students did not determine the average per-bedroom rent in boarding houses in Kent, which is what most of Gold Zone’s properties are.
Connected to Kent
Besides his entrepreneurial fluency, Koberna has another motivation driving him: Because all of his children have special needs, he said they will require care for the rest of their lives.
“It’s not like planning for college where you do something, and you’re done, right? I need an income stream for the next 70 years,” he said.
Koberna could fairly easily start investing in real estate anywhere in the country. But he says he likes working on projects close to home and family. He prefers investing in what he already knows, like his neighborhood restaurant or his old college house, which he recently purchased.
He used to spend a lot of time at the Twin Lakes Tavern and became friends with the former owner, Richard Gressard, who died in 2018. Now Koberna is a part owner of the new incarnation of the property, The Lake House, along with Mike Beder. The pair are also the new owners of The Loft, the iconic downtown bar.
“What I like about Kent is that I feel like I’m connected to it and know that market, not because I’m a real estate guy but because I’ve just been there the whole time,” he said.