After Moody’s and other credit ratings agencies tightened their standards a few years ago, universities had to become much more disciplined about their financing mechanisms.
“Internally, we are paying a great deal of attention to cash on hand relative to debt to maintain our good ratings,” says Gonzaga University EVP Marty Martin. “It’s a constant reference point.”
“The financing climate is different than it was 20 years ago,” notes UC Santa Barbara Campus Architect Marc Fisher, AIA. “The state is not funding construction at the same pace. We’re going to see more student-funded, donor-funded, and research-funded projects. We’ll see more creative funding in the future.”
One such creative funding option is the public-private partnership. The PPP strategy is most popular for student housing, mixed-use buildings, parking facilities, and retail—any project with a revenue stream.
The University of Texas at Dallas recently selected Balfour Beatty and Wynne/Jackson to develop a mixed-use project near the edge of the campus. To be called “Comet Town,” the project will be financed through a land lease, whereby the university will lease the land to the developer who will build, own, and operate the building for a specific period.
Apartments will be open to the public, but most residents are expected to be part of the UT community, says Dr. Calvin Jamison, VP of Administration.
The University of Wisconsin–Madison has employed third-party partnerships sparingly, but did so twice when a private developer needed more space to build on a couple of residential/retail properties adjacent to campus.
The state university also teamed up with the Morgridge Institute for Research a few years ago to build the Wisconsin Institutes for Discovery, a research lab that includes retail/restaurant space. Half of the lab space is privately owned.
In the wake of the recession, Cornell University instituted new guidelines for major capital projects. “One of the pillars of the new policy was no new debt,” says University Architect Gilbert Delgado, AIA. “Funding for all projects has to be either identified or on hand before a project goes forward.”
For Weill Cornell Medical College, a New York City institution since 1898, the university is exploring the construction of a major residential tower with a private developer. “Our goal is to make housing more affordable for students, faculty, and staff,” says Delgado.
To keep rents affordable, future residential projects in the city might include so-called micro apartments about half the size of a studio unit, supplemented with more generous common areas. Delgado says the university is also studying how to build more affordable housing in Ithaca—“maybe through PPP-type land-lease agreements,” he says.
More from BD+C's exclusive report, "How your firm can gain an edge on university projects."
Related Stories
Healthcare Facilities | Dec 14, 2022
In Flint, Mich., a new health center brings together children’s mental and physical health services
Families with children who experience behavioral health issues often have to travel to multiple care facilities to see multiple teams of specialists. In Flint, Mich., the new Center for Children’s Integrated Services at Genesee Health System (GHS), a public mental health provider, brings together all of the GHS children’s programs, including its behavioral health programs, under one roof. It provides families a single destination for their children’s mental healthcare.
Sponsored | Multifamily Housing | Dec 14, 2022
Urban housing revival: 3 creative multifamily housing renovations
This continuing education course from Bruner/Cott & Associates highlights three compelling projects that involve reimagining unlikely buildings for compelling multifamily housing developments.
Multifamily Housing | Dec 13, 2022
Top 106 multifamily housing kitchen and bath amenities – get the full report (FREE!)
Multifamily Design+Construction's inaugural “Kitchen+Bath Survey” of multifamily developers, architects, contractors, and others made it clear that supply chain problems are impacting multifamily housing projects.
Green | Dec 9, 2022
Reaching carbon neutrality in building portfolios ranks high for organizations
Reaching carbon neutrality with their building portfolios ranks high in importance among sustainability goals for organizations responding to a Honeywell/Reuters survey of senior executives at 187 large, multinational corporations. Nearly nine in 10 respondents (87%) say that achieving carbon neutrality in their building portfolio is either extremely (58%) or somewhat (29%) important in relation to their overall ESG goals. Only 4% of respondents called it unimportant.
Green | Dec 9, 2022
Newly formed Net Zero Built Environment Council aims to decarbonize the built world
Global management consulting firm McKinsey recently launched the Net Zero Built Environment Council, a cross-sector coalition of industry stakeholders aiming to decarbonize the built world. The council’s chief goal is to collaboratively create new pathways to cut greenhouse gas emissions from buildings.
High-rise Construction | Dec 7, 2022
SOM reveals its design for Singapore’s tallest skyscraper
Skidmore, Owings & Merrill (SOM) has revealed its design for 8 Shenton Way—a mixed-use tower that will stand 63 stories and 305 meters (1,000 feet) high, becoming Singapore’s tallest skyscraper. The design team also plans to make the building one of Asia’s most sustainable skyscrapers. The tower incorporates post-pandemic design features.
Office Buildings | Dec 7, 2022
Software giant SAP opens engineering academy for its global engineering workforce
Software giant SAP has opened its new SAP Academy for Engineering on the company’s San Ramon, Calif. campus. Designed by HGA, the Engineering Academy will provide professional development opportunities for SAP’s global engineering workforce. At the Engineering Academy, cohorts from SAP offices across the globe will come together for intensive, six-month training programs.
Multifamily Housing | Dec 7, 2022
Canada’s largest net-zero carbon residential community to include affordable units
The newly unveiled design for Canada’s largest net-zero carbon residential community includes two towers that will create a new destination within Ottawa and form a striking gateway into LeBreton Flats. The development will be transit-oriented, mixed-income, mixed-use, and include unprecedented sustainability targets. Dream LeBreton is a partnership between real estate companies Dream Asset Management, Dream Impact, and local non-profit MultiFaith Housing Initiative.
Student Housing | Dec 7, 2022
Cornell University builds massive student housing complex to accommodate planned enrollment growth
In Ithaca, N.Y., Cornell University has completed its North Campus Residential Expansion (NCRE) project. Designed by ikon.5 architects, the 776,000-sf project provides 1,200 beds for first-year students and 800 beds for sophomore students. The NCRE project aimed to accommodate the university’s planned growth in student enrollment while meeting its green infrastructure standards. Cornell University plans to achieve carbon neutrality by 2035.
Office Buildings | Dec 6, 2022
‘Chicago’s healthiest office tower’ achieves LEED Gold, WELL Platinum, and WiredScore Platinum
Goettsch Partners (GP) recently completed 320 South Canal, billed as “Chicago’s healthiest office tower,” according to the architecture firm. Located across the street from Chicago Union Station and close to major expressways, the 51-story tower totals 1,740,000 sf. It includes a conference center, fitness center, restaurant, to-go market, branch bank, and a cocktail lounge in an adjacent structure, as well as parking for 324 cars/electric vehicles and 114 bicycles.
