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2016 State of Facilities in Higher EducationDecember 15, 2016
Presenters:
Peter ReevesAssociate Director, Member Services
Sightlines
Pete ZurawVice President, Market
Strategy & DevelopmentSightlines
2
2016 State of Facilities ReportDownload your copy now!
www.sightlines.com/insight/2016-state-of-facilities
Agenda
3
Introduction to Sightlines and our database
Review of 2016 State of Facilities trends – Space, Capital, & Operations
Summary of trends & strategies for success
Questions and discussion
4
Join the Conversation
Presentation slides and webinar recording will be sent
to each attendee following today’s session
Enter questions here at any point during the webinar
Resource HandoutsInstant access to complimentary content
5
Resources Available:
From Boiler Room to Boardroom – Creating Alignment with Non-Facilities Professionals
Focusing a Campus Investment Strategy
Data & Sustainability – How the Right Data Creates Success
Plan More, React Less – Building and Expanding Your Planned Maintenance Program
Speaker Bios
Data & Sustainability.pptx Out with the Old.pptx Plan More, React Less.pptx Show all downloads…
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Introduction to Sightlines
7
Proud to be a Gordian CompanySolutions for the Construction Lifecycle
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Insights and Analysis to Shape Facilities StrategyFrom boiler room to boardroom
What We Do
Sightlines provide tools for strategic planning, analyzing, and benchmarking that generate an independent, reliable comparison of campus performance against peer institutions.
Our facilities intelligence tools give you the power to:
Use data and benchmarking to align strategies from the boiler room to the boardroom
Conduct facilities assessments and capital plans
Empower your sustainability officer
Forecast and plan for upcoming facilities needs
9
The State of Facilities DatabaseRobust membership includes colleges, universities, consortiums and state systems
* U.S. News 2016 Rankings
Serving the Nation’s Leading Institutions:
• 70% of the Top 20 Colleges*
• 75% of the Top 20 Universities*
• 34 Flagship State Universities
• 14 of the 14 Big 10 Institutions
• 9 of the 12 Ivy Plus Institutions
The 2016 State of Facilities in Higher Education draws from the largest verified database of college and university facilities metrics in the country.
• The database features 377 institutions with over 400 campuses in 43 U.S. states and four Canadian provinces containing over 1.5 billion gross square feet of space and 40,000+ buildings
• All data is collected and verified by Sightlines professionals
• The database includes 60% public and 40% private institutions with an even mix of comprehensive/doctoral, research, and small institutions serving over 3 million students
• The database is supplemented by our 2014 analysis of 51 Canadian universities with over 200 million gross square feet of space.
10
2016 State of Facilities in Higher Education
Introduction to Key FindingsWhat are the latest facilities challenges in higher education?
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Deferred maintenance backlogs are significant across all types of institutions and conditions exist for continued growth.
The three main areas that are contributing to the growth of deferred maintenance are:
A significant amount of existing space was constructed during a period of rapid, poor quality construction
Most buildings have received insufficient capital funding to slow down the backlog as they have aged
The recent emphasis on constructing new space is directly competing for capital investment that could have been used for updating existing facilities.
These conditions are being impacted by a slowing of enrollment growth at many campuses and by flat budgets for facilities operations.
12
Aligning Finance and Facilities in Higher EducationLooking at space, capital, and operations together leads to successful facilities strategies
Average Campus Renovation Age 35
Total database CRV $288B
Total database capital investment $4B
Total database operating expenditures $5.4B
Space Profile
14
Space Growing Faster Than Enrollment in 2014 and 2015
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2007 2008 2009 2010 2011 2012 2013 2014 2015
Pe
rce
nt
Ch
ange
Space and Enrollment TrendsNational Average
Space Enrollment
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Space and Enrollment Growth – Public vs. Private
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2007 2008 2009 2010 2011 2012 2013 2014 2015
Pe
rce
nt
Ch
ange
Space and EnrollmentPublic Institutions
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2007 2008 2009 2010 2011 2012 2013 2014 2015
Pe
rce
nt
Ch
ange
Space and EnrollmentPrivate Institutions
16
Space and Enrollment Growth by Constituent Group
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
Pe
rce
nt
Ch
ange
Space and Enrollment
Comprehensive Institutions Research Institutions Small Institutions
De
nsi
ty: U
sers
pe
r 1
00
,00
0/G
SF
Liberal Arts Comprehensive University Small Institutions & Community College
Urban/City
Public Institution Average
17
Campuses Becoming Less Dense with Low Utilization Rates
Density Factor Across the Sightlines Database
Mea
n
The database average for Density has decreased by 5% over the past 5 years.
The average classroom utilization rate is 50%-60%
*Density Factor measures the number of faculty, staff and students FTEs on campus per hundred thousand square feet.
Private Institution Average
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Putting Campus Building Age in Context
Pre
-Wa
r Built before 1951
Durable construction
Older but typically lasts longer
Po
st-
Wa
r
Built between 1951 and 1975
Lower-quality construction
Already needing more repairs and renovations M
od
ern Built between 1975 and 1990
Quick-flash construction
Low-quality building components
Co
mp
lex Built in 1991 and newer
Technically complex spaces
Higher-quality, more expensive to maintain & repair
Pre-War Post-War Modern Complex
0%
2%
4%
6%
8%
10%
12%
% o
f G
SF
Sightlines Database- Construction Age Sightlines Database- Renovation Age
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Square Footage by Age CategoryProgress in balancing campus age profile
13% 19%
18%
26%
31%
30%
38%25%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Construction Age Renovation Age
% o
f Sp
ace
Construction Age vs. Renovation Age
Under 10 10 to 25 25 to 50 Over 50
Buildings Under 10
Little work. “Honeymoon” period.
Low Risk
Buildings 10 to 25
Short life-cycle needs; primarily space renewal.
Medium Risk
Buildings 25 to 50
Major envelope and mechanical life cycles come due.
Higher Risk
Buildings over 50
Life cycles of major building components are past due. Failures are possible.
Highest risk
Square Footage by Renovation Age CategoryPublic vs. Private – both groups seeing increases in space over 25 years old
20
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%%
of
Spac
e
Under 10 10 to 25 25 to 50 Over 50
Private AverageNational Average Public Average
Capital Profile
Capital Investment in Existing SpaceSteady investment levels with continued improvement in annual capital funding
22
$1.12 $1.19 $1.28 $1.21$1.60 $1.67 $1.71 $1.59 $1.73
$3.10
$3.83 $3.88$3.63 $3.09
$3.37 $3.35$2.99
$3.32
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Capital Investment into Existing Space
Annual Capital One-Time Capital Average
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Capital Investment in Existing SpaceReliance on annual institutional capital growing for both public and private institutions
$0.77 $0.93 $1.11 $1.00$1.39 $1.47 $1.49 $1.30 $1.48
$2.51
$3.37
$3.66 $4.06 $3.28$3.56 $3.43
$2.95
$3.39
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Public Institutions
$1.55 $1.53 $1.51 $1.51$1.88 $1.96 $2.01 $1.97 $2.06
$3.83
$4.43$4.19
$3.04
$2.84$3.12
$3.23$3.05
$3.22
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Private Institutions
24
Capital Investment by Constituent GroupAnnual capital growth trend continues for all institution types
1.01 1.08 1.20 1.031.23
1.43 1.41 1.42 1.441.18 1.23 1.30 1.31 1.39 1.56 1.67 1.59 1.67
1.40 1.37 1.39 1.31
1.95 1.97 2.111.74
2.16
3.04
3.82
4.19
3.603.43
3.533.73
3.33 3.153.24
3.88 3.903.46
3.59 3.26
3.694.12
4.28
3.30
4.08
3.473.29
2.30
3.10 2.89
1.86
2.96
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$/G
SF
Annual Capital One-Time Capital National Average
Comprehensive Institution
Research Institution
Small Institution
Facilities Backlogs Continue to Rise
25
$81.72 $83.42 $87.19 $88.52 $90.73 $93.27 $95.31 $97.56 $100.07
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Backlog $/GSF
The Sightlines backlog total includes maintenance/repair, modernization and infrastructure
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Facilities Backlogs Continue to Rise
$0
$20
$40
$60
$80
$100
$120
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Public Institutions
The Sightlines backlog total includes maintenance/repair, modernization and infrastructure
$0
$20
$40
$60
$80
$100
$120
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Private Institutions
Operations Profile
$3.98$4.26 $4.33 $4.37 $4.41 $4.44 $4.54 $4.65 $4.74
$0.25$0.26 $0.26 $0.26 $0.27 $0.29 $0.29
$0.31 $0.33
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Facilities Operating Budget $/GSF
Daily Service Planned Maintenance
Facilities Operating BudgetSmall increases in campus operating budgets from 2007-2015
28
29
Facilities Operating BudgetPublic vs. Private
$3.89$4.22 $4.29 $4.35 $4.40 $4.40 $4.50 $4.59 $4.67
$0.22
$0.23 $0.23 $0.23 $0.24 $0.26$0.27
$0.28$0.31
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SFPublic Institutions
$4.10$4.31 $4.41 $4.38 $4.41 $4.50 $4.61 $4.72 $4.84
$0.29$0.30
$0.31 $0.30 $0.32$0.33
$0.33$0.35
$0.36
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
2007 2008 2009 2010 2011 2012 2013 2014 2015
$/G
SF
Private Institutions
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000To
tal G
SF/F
TEPrivate Average
Custodial Coverage Rates Flatten in 2015
30
National Average Public Average
Custodial CoverageGSF per FTE
31
Maintenance Coverage Rates Start to Level Off
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000To
tal G
SF/F
TE
Maintenance CoverageGSF per FTE
Private AverageNational Average Public Average
32
Modest Energy Reductions Since 2007
82,251 83,320 78,403 75,875 77,505 69,317 73,993 76,834 72,740
51,196 52,788 53,124
52,471 53,031
52,010 51,230
51,553 50,487
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2007 2008 2009 2010 2011 2012 2013 2014 2015
Pe
rce
nt
Ch
ange
BTU
/GSF
Energy Consumption
Fossil Electric Percent Change
33
Fuel Switching Driving Down Energy Costs
$10.87 $11.62 $11.57 $9.95$9.22 $8.88 $8.37 $8.88 $8.45
$27.71$29.56
$29.88$29.36
$29.51$28.16
$27.67 $27.80$28.21
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
$0
$5
$10
$15
$20
$25
$30
$35
$40
2007 2008 2009 2010 2011 2012 2013 2014 2015
Pe
rce
nt
Ch
ange
$/M
MB
TU
Energy Unit Cost
Fossil Electric Percent Change
Summary of Trends & Strategies
Summary of Trends
The aging campus is driven by the need to renovate or replace 1960s and 70s buildings, many of which were poorly constructed
To add to the problem, campuses have added new, more complex square footage to address increasing enrollment that has now leveled off or is even in decline
The combined demand for both “catch up” on aging buildings and “keep up” of newer buildings is much higher than the availability of capital funding
Summary of Trends cont.
Therefore, backlogs continue to grow even though capital funding is back to pre-recession levels, not adjusted for inflation
Flat operating budgets have not provided relief to the backlog problem, although there are signs of improvement
Modest improvements in energy consumption. Fossil fuel costs have declined primarily driven by shift to natural gas.
What are Campuses Doing to Manage Backlog and Reduce Risk?By aligning space, capital, and operations strategies
Lower Capital and Operational DemandsImprove space management; eliminate buildings in poor condition; create a more balanced age profile; improve classroom utilization if enrollment is flat or declining.
Make the Problem “Smaller” for Campus Decision-MakersUnderstand that campuses are a collection of assets that can be managed as an investment portfolio; funding is finite, but all buildings are not equal.
Make a Greater Impact with Capital FundingCreate multi-year capital plan for steady annual investment; target capital to safety, reliability and critical program needs; track data that show improvements to make the case for more funding.
Manage Operational ResourcesAllocate daily service and planned maintenance time depending on condition and importance of building. Communicate standards for new service levels to campus community.
Make the Case for Additional Resources
The old approach of defining needs in a way that makes the DM problem bigger and then requesting money will not work.
Not all buildings are created equal, therefore they should not be treated that way. Subdivide capital projects by issues of reliability, safety/code, program, transitional, and asset preservation to create “balance” and “diversity” in all facility investments to lower risk.
Time can be an asset if you manage space, capital and operational resources properly. You can target critical renovations and postpone work without increasing risks of systems failure.
Use data and metrics to show the capital and operational costs of adding new space without eliminating existing space in poor condition.
Demonstrate success from managing space, capital and operations in an integrated way. Use the data and actions to make the case for additional funding.
Thank you for attending!
Questions/Comments?
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203.682.4950
insights@sightlines.com
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40
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Questions/Comments?
Connect with Sightlines
www.sightlines.com/insights/blog
www.twitter.com/SightlinesLLC
www.linkedin.com/companies/Sightlines
www.sightlines.com
203.682.4950
insights@sightlines.com
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