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I've build trains to them. Metro, tram, buss, blimps. You name it. It doesn't matter. They will not go even if they don't have to walk 1 inch to them. But plop down the classic college building and it instantly fills to 4000K and it will do it right next to the campus area. Students will even leave the campus area for old college buildings.
It's sad design. Again the Idea it great. The buildings you put in look great. You just have to realize you'll have thousands screaming for college and even if they live across the street they'll not go to them.
But build 1 of the old style buildings as far away as you can from anyone and they'll fill instantly. It's maddening really.
Yes, they most certainly will compete with each other. To minimize this I don't build the old versions at all until all three Campus versions are maxed out in prestige, and I try to build the Campus versions on different city sides to maximize their coverage. I also only have one school with active policies until it's maxed out in prestige as well. When their prestige drops you don't lose any building you've already built (but you may not be able to build new ones that are locked to the higher level). I don't know if people have a preferred type of college to go to though.
1. They have an area of effect for land value and happiness
2. They will soak up demand for tertiary, secondary and primary education respectively across the city (I find if I open a new area and plonk a school down, it is immediately filled to about the same level as schools elsewhere, even though there are no nearby students) with no relationship between local demand and local supply (read area of effect).
I have also found it impossible to 'fill' my Campus DLC tertiary facilities, no matter where I put them or how many dorms, faculties or other buildings I put in or how attractive (no fees, free lunches etc.) I make it or the transport options as well for that matter. I'm almost always forced to add a classic university to match demand. It would be good to get a "realistic" mod for this as well.