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MAXIMIZE THE VALUE OF THE REAL ESTATE ASSETS OF HIGHER EDUCATION INSTITUTIONS

L. B. BRAILSFORD & DUNLAVEY. S. EH. M. A. N. R. O. T. H. E. R. MAXIMIZE THE VALUE OF THE REAL ESTATE ASSETS OF HIGHER EDUCATION INSTITUTIONS. Carole Wedge, President Shepley Bulfinch Richardson & Abbott Thomas Kearns, Principal Shepley Bulfinch Richardson & Abbott

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MAXIMIZE THE VALUE OF THE REAL ESTATE ASSETS OF HIGHER EDUCATION INSTITUTIONS

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  1. L B BRAILSFORD & DUNLAVEY S EH M A N R O T H E R MAXIMIZE THE VALUE OF THE REAL ESTATE ASSETS OF HIGHER EDUCATION INSTITUTIONS • Carole Wedge, President Shepley Bulfinch Richardson & Abbott • Thomas Kearns, Principal Shepley Bulfinch Richardson & Abbott • Wallace Mlyniec, Former Associate Dean Georgetown University Law School • Jeff Turner, Senior Vice President Brailsford & Dunlavey • John Augustine, Managing Director Lehman Brothers Georgetown Law Shepley Bulfinch

  2. Carole

  3. Valuing Assets: • The Campus • Fresh Students Every Year Understanding Options: • Real Estate • Funding • New Models Linking Strategy: • Operating and Capital Budgets • Payback / Lifecycle • Evaluating Delay: • Escalation • Recruitment • Opportunities Missed

  4. CAPITAL PROJECTS IN CONTEXT Initiatives that may impact space needs…capital planning… and dollars. • Strategic Plan • Curriculum Plan • Growth • Technology • Innovation • Administration Change • Sustainability Commitments

  5. How can we accomplish this? (Show me the $$$$) • How do we garner support? (Show me the $$$$) • How will this make us competitive? (Why is this important?) • How will this improve our recruitment? (Why is this important?) • Can we afford this? (What are the operating costs?) QUESTIONS INSTITUTIONS ARE ASKING

  6. TRENDS IN HIGHER EDUCATION • Institution as Economic Engine • Transformational Student Experience • Changes in Teaching and Learning • Changes in Living Environments

  7. Wally

  8. GEORGETOWN LAW SCHOOL FOUNDED IN 1875 2006 GULC

  9. DOWNTOWN D.C.

  10. GEORGETOWN UNIVERSITY LAW CENTER CAMPUS

  11. BERNARD McDONOUGH HALL EDWARD DURRELL STONE, ARCHITECT

  12. EDWARD BENNETT WILLIAMS LIBRARYHARTMAN & COX, ARCHITECT

  13. BERNARD AND SARAH GEWIRZ BUILDINGHARTMAN & COX, ARCHITECT

  14. BERNARD MCDONOUGH HALL EAST WINGHARTMAN & COX, ARCHITECT

  15. GEORGETOWN UNIVERSITY LAW CENTER CAMPUS

  16. ERIC HOTUNG INTERNATIONAL LAW BUILDINGSHEPLEY BULFINCH, ARCHITECT

  17. GEORGETOWN SPORT AND FITNESS CENTER SHEPLEY BULFINCH, ARCHITECT

  18. THE FUTURE

  19. Tom

  20. INSTITUTION AS ECONOMIC ENGINE

  21. INSTITUTION AS ECONOMIC ENGINE

  22. INSTITUTION AS ECONOMIC ENGINE

  23. INSTITUTION AS ECONOMIC ENGINE

  24. INSTITUTION AS ECONOMIC ENGINE

  25. INSTITUTION AS ECONOMIC ENGINE

  26. INSTITUTION AS ECONOMIC ENGINE

  27. INSTITUTION AS ECONOMIC ENGINE

  28. CHANGING LEARNING STYLES Problem – Traditional classrooms have key restrictions of limited resource availability and physical isolation.

  29. CHANGING LEARNING STYLES

  30. CHANGING LEARNING STYLES Class with Remote Guest Speaker – Imported into the classroom via video with the session including guest captured in streaming format and shared with faculty and students doing interdisciplinary work in related fields.

  31. CHANGING LEARNING STYLES Goal - Establish a portfolio of flexible and technologically-enhanced formal and informal learning spaces in support of socially-enabled inquiry and discovery.

  32. CHANGING LEARNING STYLES Media Creation – iPods, iTunes, iPhoto, eBooks, iLectures, videophones, BluRay disks for stereoscopic video, Lectopia, Symposia, Blackboard.

  33. CHANGING LEARNING STYLES

  34. CASE STUDY: XAVIER UNIVERSITY

  35. CASE STUDY: BUCKNELL UNIVERSITY

  36. CASE STUDY: BUCKNELL UNIVERSITY

  37. Jeff

  38. Construction Costs 15-25% budget shortfall Owner's Budget TRENDS TOWARDS ALTERNATIVE FINANCING & PARTNERSHIPS • Limited State Financial Support • Speed of Delivery & Execution • Increasing Construction Costs • Allow for greatest expertise • Community Partnerships

  39. TRENDS TOWARDS ALTERNATIVE FINANCING & PARTNERSHIPS

  40. TRENDS TOWARDS ALTERNATIVE FINANCING & PARTNERSHIPS • Less defined campus edges • Off-campus university bookstores make for strong anchors • College towns potentially incubate new business • Student population accounts for 20% of the market* • Successful college towns consists of high-end national (30%) as well as local merchants (70%)* *Source: Ayers Saint Gross

  41. MARSHALL UNIVERSITY – WELLNESS CENTER & STUDENT HOUSING • Initial RFP for design services • Revised RFP Issued for full development services including: • Health/Wellness Center • Student Housing • Campus/state limited debt capacity • Developer led process • 120,000 gsf Wellness Center • 780 beds of housing Courtesy of Capstone, D/C, & H&C

  42. GEORGE MASON UNIVERSITY – FREEDOM CENTER • Limited Recreational Facilities in Prince William County • Tri-partite Agreement with George Mason U, city of Manassas, and Prince William County • Facility covers operating costs plus a portion of debt service • Remaining debt service split based on usage • Over 600k users a year • Over 5,000 members, 7,000 memberships • Discussing an expansion • New Performing Arts Center looking at similar operating model

  43. BUCKNELL UNIVERSITY - LEWISBURG, PA • CURRENT SITUATION • Considerable loss of regional manufacturing jobs • Suburban development causing decline of boroughs as commercial hubs • Changing demographics, “graying” population • Fragile downtown Lewisburg with independent retail • Rising threats to a Heartland Region core community

  44. TOWN – GOWN DYNAMICS • Increasing competition for high school graduates • Increasingly sophisticated student and faculty/staff quality of life expectations • Universities expected to look beyond campus • Courting of the “creative class” • Diversity of sports, cultural, and learning activities • Building a “creative ecosystem” to attract 21st century jobs and workers First Initiative: Neighborhood Improvement Projects

  45. 1 2 CURRENT NEIGHBORHOOD PROJECTS • Main Street & Elm Street Grants • Streetscape and Façade Improvements (1) • 7th Street Reconstruction (2) Market Street Second Initiative: Magnifying Neighborhood Improvements Bucknell

  46. UNIVERSITY VILLAGE OBJECTIVES • Strengthen Recruitment • Enhance the Neighborhood • Create Market Street Link • Define a University Gateway • Improve Community Relations • Clarify Faculty / Student Housing Options • Complement existing retail on Market Street

  47. Market Street Strawberry Alley Hawn Alley St. George LEWISBURG NEIGHBORHOOD STUDY AREA

  48. MARKET ANALYSIS CONTEXT Study Area • 82 Owners • 181 Parcels • 36 Acres Primary Area • 53 Owners • 126 Parcels • 29 Acres

  49. PROCESS Community Market Campus Market Demand and Supply Analysis Market Feasibility Preliminary Program Pro Forma, Project Uses Financial Feasibility Project Concept Financing Mechanism, Development Structure Project Sources, Project Participants Implementation Strategy

  50. OUTCOMES Neighborhood Real Estate Product Drivers Community Market Campus Market For-Sale Housing Rental Housing Retail Conference Space Hotel Office Space Demand Neutral High Demand Demand Neutral High Demand

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