Mixed Use Developments

Below are a number of mixed-use developments on or nearby campuses throughout the U.S. and in Canada. The list is by no means exhaustive, but provide a cross section of sampling of recent developments. Thanks goes to Fred Pierce of Pierce Education Properties, Paul Senhert at the University of Pennsylvania and others for providing these examples.

Financing for these and most other projects have dried up considerably yet, as you can see, there are some fairly substantial projects in the pipeline that were able to weather the financial storm.

Arizona

Arizona State University, Tempe, AZ – The Threshold Project

California
University Gateway, University of Southern California. University Gateway is an 8-story, 623,000 square foot mixed-use project currently under construction for delivery in fall 2010. The project includes 421 units (1,642 beds) of student housing built over 81,500 square feet of ground level retail space (including 30,000 sf master leased to USC), privately financed on a 95-year ground lease from USC. This project is a development of LA-based Urban Partners LLC.

Iowa
Iowa State University, Ames, IA – Campustown Business District

Maryland

University of Maryland, College Park, MD – East Campus Redevelopment Initiative

Michigan

Michigan State University, East Lansing, MI – East Village

Minnesota

St. Cloud State University, St. Cloud MN - 5th Avenue Live

North Carolina

University of North Carolina, Chapel Hill, NC – Granville Towers Site

Ohio

South Campus Gateway, Ohio State University. South Campus Gateway at Ohio State University is a 7.4 acre, $160 million, seven-building, mixed-use entertainment complex located on the southern edge of the OSU campus. The 500,000 square foot project’s five-story structures contain restaurants and nightspots, an eight-screen arts cinema, a 50,000 square foot Barnes & Noble campus bookstore, a 14,000 square foot natural foods grocery store, several locally and nationally owned boutique shops, 184 market-rate student apartment units, 88,000 square feet of university office space and a 1,200 square foot parking garage (completed by Campus Partners for Community Urban Development, a nonprofit organization closely affiliated with Ohio State University).

University of Toledo, Toledo, OH – Dorr Street Gateway Redevelopment Project

Pennsylvania

University of Pennsylvania

Radian Apartments
http://www.domuspa.com
The Hub on Chestnut

All three are done on long-term participating ground lease with the University and a private developer.

Canada

The University of British Columbia (UBC) just finished a 40,000 sf project which has retail and common space on the ground floor and 3 floors of 81 students units above. This building is called MBA House and it houses student enrolled in the MBA program at the Robert H. Lee Graduate School at the Sauder School of Business.

UBC also completed another mixed use project which has a grocery store on the main floor and market rental apartments above. These units are open to the public but we still get students renting them. UBC Properties Trust developed the project and retains ownership with all profits going to the UBC Endowment Fund.

Do colleges closer to the capital get more money?

I was persuing some blogs when I ran across the article from a few months ago on Inside Higher Ed "Location, Location, Location" about studies that attempt to explain patterns in which some institutions end up doing better in funding from their state than others (or less worse than others), factoring in their missions. The article generalizes that location plays a fairly significant role in what institutions receive more funding. It also notes that states that tend to have more Democrats and professionalized legislatures tend to spend more on higher education.

Selected Auditors Evaluation of State Land Ownership

Recently the Minnesota Legislative Auditor has been asked to evaluate state ownership of land, which includes public colleges and universities. The outline of their scope is listed here. It's not clear whether the audit will include the University of Minnesota system, which is separately organized from the state. Incidentally, the U of M land holdings are about 4 times the size of the state universities and colleges, so it would seem logical that they would be swept in. That doesn't include trust lands or other lands that are for the benefit of the university, but are not titled to the U of M.

This seems to be the first state-wide audit of land ownership in Minnesota.

Nationwide, there have been several broad programmatic audits that included higher education real estate. For example, California undertook a state-wide audit in 2001, which included the University of California system and California State Universities. The report is shown here.

Oregon audited what they termed "off campus" properties, which seemed to be properties that were not located or contiguous from main campus facilities.

A recent New York audit of SUNY Upstate Medical University spent $409,000 leasing office space in downtown Syracuse that sat empty for nearly four years. The audit lays out some interesting leasing details about several SUNY campuses.

With the economic downturn, universities and colleges - like most public entities - will be the subject of intense scrutiny. Like corporate entities, the majority of their assets (and liabilities) are in personnel and land and buildings. Personnel costs have historically been easier to track and quantify or otherwise measure, and these costs are being addressed at many institutions with salary freezes, layoff and furloughs.

By contrast, very few higher education institutions have invested in measuring the performance of their real property assets, nor have they given much thought to "portfolio" management. The first rule in this area is that you need to know what you own before you can manage it, and that seems to be the fundamental question being answered in Minnesota. However, it will be interesting to watch after the results are reported. There is certainly growing political will to take more activist approaches to limiting college tuition increases at public colleges and universities, and perhaps land surplusing is a short term answer.

Credentialing Public Sector Real Estate Professionals

There are a subset of people working for colleges and universities throughout the U.S. and Canada who serve in a role similar to corporate real estate officers in the private sector. Borrowing from the CoreNet Global folks who have credentialing programs for "Master of Corporate Real Estate" and "Senior Leaders in Real Estate", I got to thinking: why shouldn't university and college real estate managers and directors have a credentialing program too?

What it would provide to the industry:
- Technical proficiency
- Best practices
- Leveraging technology
- Emerging trends in higher education
- Aligning real estate with institutional goals

Sure, we need to be technically proficient real estate practitioners, but we also need to understand our business, which is not just profit/loss and what the balance sheet shows in any given quarter. Higher Education Real Estate Professionals are impacted by an even broader array of federal and state laws, institutional policies and practices, and often have the authority of eminent domain. We're expected to do a lot with little, and to do it with the assistance of private sector help requires substantial investments of time and drafting RFPs.

We're a smart lot. People in our industry come from all over, including the private sector - we're attorneys or former commercial brokers.

We work for institutions of higher education. Why can't we find the discipline to be taught how to do our job better?