The highest level of demand for capital investment on college campuses is coming down the pike as many buildings reach their expected lifespan. Campuses are trying to recruit students with new state-of-the-art buildings while other building are deteriorating and becoming more expensive to maintain. College campuses continue to expand their footprint despite declining enrollment rates. As if all of that wasn’t enough, add budget cuts to the mix. To say facilities management departments are facing a rough patch is an understatement. However, with proper project planning, higher ed facilities groups can make wise investment decisions to receive the best return on investment both now and into the future.
A recent Sightlines report by Gordian outlines six ways facilities managers can make successful investment decisions to receive the best return. The bottom line: we need to move away from putting out day-to-day fires and move towards long-term planning and data tracking.
Historic Spending vs. Future Needs
Categorize facility spending and track historic investments. For example, how much money was put towards mechanical upgrades vs. space renewal over the years? Compare previous spending categories to current and future spending needs. Reviewing historic categorical spending will enable you to gradually reallocate the funds to make proper budget shifts and hit future investment targets.
Review Work Orders & Operational Costs
Track operational costs and deferred maintenance of campus buildings. Buildings with higher operational costs should be considered first when making campus improvements. Instead of continuing to invest in costly building maintenance, it may be time to make some building updates, such as investing in a new building system. The upfront investment will lead to less time and money spent on those buildings in the future. To make a truly strategic investment, all costs and savings must be analyzed. Aside from costs, capital planning should also include possible future savings.
Invest vs. Divest - Weigh Costs
New construction isn’t always the answer; it doesn’t help with the current maintenance backlog, and it adds one more building to the future maintenance list. In some instances, it may be better to remove wasted or unused spaces to free up resources. Over the past few years, more universities are creating strategic partnerships with developers. The university can leverage available funds by leasing buildings when extra space is needed without worrying about the maintenance and building expenses. It can be a smart short-term investment decision.
We recently came across an example of the value of weighing the costs during a recent university student housing project. A major university is currently in the midst of the largest residence hall construction project ever undertaken on campus. The university analyzed the costs of building new student housing, renovating the existing residence halls, and partnering with a developer to share the expense. After reviewing the costs associated with taking buildings offline, additional time required to demolish existing buildings, available bed count during project construction, future maintenance costs, building life expectancy, and more, the university decided to renovate the existing buildings as well as take advantage of available space to build two new residence halls. The new buildings allowed the university to maintain its required bed count during each phase of the project. The major structural components of the existing buildings remain; however, the buildings look like new buildings.
Compare Building Needs & Program Value
By categorizing buildings by investment needs and potential program value, facility departments can demonstrate which buildings should be prioritized to receive improvements. Plotting out buildings’ investment needs and program value will generate a clear roadmap of life-cycle costs, and in turn, more easily gaining buy-in from stakeholders.
Segmenting Campus Needs
Similar to the step above, group buildings together that have a similar function, priority, or strategy based on the institution’s goals. This helps identify areas of emphasis and makes it easier to allocate and prioritize funds across campus facilities.
Listen to End Users
Before the plan is set in stone, ask your end users for feedback. Survey users on the condition of the buildings, their experiences, and first impressions to see if they validate your plan. As with any project, it’s important to receive feedback and suggestions from the daily user.
As you can see from the above steps, it’s important to track campus data – historic data, present trends, and future goals. By following this approach, it becomes easier to see where the campus is now and where it needs to be in the future. When used together, these steps can help campuses invest smartly for the future.
Reach out to us to learn more about the referenced project.
For more planning details and visuals, check out the full Gordian report.