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ERAPPA Webinar:National and Regional Trends and Challenges for Facilities What They Mean for Your Campus

Date: May 15, 2013Moderated by: Christine Matheson, Vice President of ERAPPA Panelists: James Kadamus, Sightlines LLC

Jeffrey Lamb, Dalhousie University Mark Frost, Siena College

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Introducing the comparison campusesUsing the Sightlines database to determine national and regional trends

Common facilities vocabulary

Consistent analytical methodology

Context through benchmarking

International Database: Over 380 Campuses

ERAPPA - Public vs. Private: Over 85 Private CampusesOver 70 Public Campuses

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#1 More space in over 50 years of age Older space profile increases risk for facilities

2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

41% 40% 39% 39% 38% 36%

18% 18% 18% 19% 20% 21%

(%) Square Footage over 25 years old(Renovation Age)

25 to 50 Years of Age Over 50 Years of Age

Overall Database

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#1 Publics have more space in 25-50; Privates more in over 50Both groups have increasing percentage of over 50 year old space

2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 20120%

10%

20%

30%

40%

50%

60%

70%

50% 49% 48% 48% 46% 44%

33% 32% 31% 30% 30% 27%

11% 11% 12% 13% 14% 14%27% 26% 27% 28% 29% 30%

(%) Square Footage over 25 years old(Renovation Age)

25 to 50 Years of Age Over 50 Years of Age

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

5

#2 Cyclical capital investments – FY 2012 less than 2008Annual capital funding is increasing and is the highest in FY 2012

2007 2008 2009 2010 2011 2012 $-

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$1.2 $1.3 $1.4 $1.3 $1.5 $1.6

$3.1

$4.0 $4.0 $3.2

$3.4 $3.3

Capital Investment into Existing Space

Annual Capital One-Time Capital

$/G

SF

Overall Database

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#2 Private campuses recovered from recession faster than publicsBoth private and public campuses commit more annual funding

2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 $-

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$7.0

$0.9 $1.0 $1.2 $1.0 $1.4 $1.6 $1.6 $1.6 $1.7 $1.6 $2.0 $2.3

$2.9

$4.7 $4.4

$3.6

$4.0 $3.3

$3.8 $4.2 $4.3

$3.2

$3.6 $3.6

Capital Investment into Existing Space

Annual Capital One-Time Capital

$/G

SF

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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13%

24%

14%

41%

8%

FY2002

Building Envelope Building Systems Infrastructure

Space Renewal Safety/Code

#3 Expenditure mix less focused on space in 2012More investment into core building components in 2012

14%

25%

15%

36%

10%

2007

18%

28%

17%

31%

7%

2012

Total Project Spending

Overall Database

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#3 Public institutions have major increase in mechanical systemsPrivate institutions have had a significant increase in building envelope

17%

26%

16%

25%

15%

2007 Public

14%

25%

15%

39%

8%

2007 Private

Total Project Spending

13%

24%

14%

41%

8%

FY2002

Building Envelope Building Systems Infrastructure

Space Renewal Safety/Code

17%

34%15%

27%

6%

2012 Public

20%

25%

13%

35%

7%

2012 Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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#4 Steady increase in backlogBacklog is up almost 15% since 2007; accelerating from 2009-2012

2007 2008 2009 2010 2011 2012 $-

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100

0%

2%

4%

6%

8%

10%

12%

14%

16%

$77 $78 $79 $82 $85 $88

Backlog $/GSF

Backlog/GSF Percentage Change of Backlog

$/G

SF

Overall Database

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#4 Public institutions have high backlog, but stablePrivate institutions backlog is less, but growing at a faster rate

2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 $-

$20

$40

$60

$80

$100

$120

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

$91 $92 $92 $97 $100 $99

$73 $73 $76 $79 $82 $86

Backlog $/GSF

$/G

SF

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 $-

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$4.6 $4.8 $4.8 $4.8 $5.0 $4.9 $4.7 $4.8 $4.9 $4.9 $4.8 $4.9

Daily Service

$/G

SF

#5 Northeast institutions have flat daily service spending

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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#6 Maintenance workers covering more spacePublics cover more space (have less staff) than Privates

2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 -

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Maintenance Coverage

GSF

/FTE

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 -

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

Custodial Coverage

GSF

/FTE

#7 Both public and privates increasing custodial coverage

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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#8 Increasing energy efficiency, especially in fossil usage

2007 2008 2009 2010 2011 2012 -

20,000

40,000

60,000

80,000

100,000

120,000

140,000

-14%

-12%

-10%

-8%

-6%

-4%

-2%

0%

Normalized Energy Consumption

Fossil Consumption Electric ConsumptionPercent Change of Total Consumption

BTU

/GSF

Overall Database

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#8 Greater gains in efficiency seen in public institutionsBoth public and private campuses are reducing consumption

2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 -

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

-16%

-14%

-12%

-10%

-8%

-6%

-4%

-2%

0%

2%

Normalized Energy Consumption

Fossil Consumption Electric ConsumptionPercentage Change in Total Consumption

BTU

/GSF

Public Private

(CT, D.C., MA, MD, ME, NH, NY, NJ, PA, RI, VT, Canada)

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• Age profiles of ERAPPA campuses indicate that both public and private institutions face growing deferred maintenance needs and overdue life cycles

Age Profile of Campus

• Declines in capital funding since 2009 puts campuses further at risk of having building systems that will fail in the near future

• Flat operating budgets mean coverage rates for maintenance and custodial are increasing

Capital and Operating Expenditures

• Backlogs are growing and already reaching high risk levels at public institutions• Private institutions have lower backlogs ; but backlogs are growing faster as buildings age

Backlog Growth

• Positive steps include: More focus on durable investments, building systems; Annual stewardship investment increasing despite economic downturn; Reductions in energy consumption and costs.

Positive Steps

Conclusions

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Dalhousie UniversityJeffrey Lamb, AVP Facilities Management

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Halifax, Nova Scotia, Canada

Dalhousie University - Campus Profile

Dalhousie University is a large, public research university using a strong operational profile to manage an aging campus and pointed capital strategies to address deferred maintenance.

Fast Facts:• Founded: 1818• 98 buildings• 4.7 Million Gross Square Feet• 18,220 students• Consistently ranked one of

Canada’s top universities• Leader in marine research

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Dalhousie University Peer Average0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

13%18%

11%

15%

53% 38%

23%29%

Under 10 10 to 25 25 to 50 Over 50

Campus age older than peersDalhousie has more high risk space than peers

65%

% of Space by Age Category

Buildings Under 10Little work .“Honeymoon” period.

Low Risk

Buildings 10 to 25Lower cost space renewal updates and

initial signs of program pressures.Medium Risk

Buildings 25 to 50Life cycles are coming due in envelope and mechanical

systems. Functional obsolescence prevalent.Higher Risk

Buildings over 50Life cycles of major building components are past due. Failures

are possible. Core modernization cycles are missed.Highest Risk

Higher RiskHigher Risk

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Campus age profile impacts the cost of OperationsWork orders in buildings 25-50 years carry a premium cost

13%

11%

53%

23%

Dalhousie Renovated Age Profile

2008 2009 2010 2011 2012$100

$150

$200

$250

$300

$350Average Daily Service Work Order Cost

$/W

O

7%6%

62%

25%

Total Daily Service Work Order Costs

DS Work Order Costs over $100/GSF higher in age category 25 to 50

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Annual stewardship compared to peersDalhousie consistently outperforms peers in Annual Stewardship investment

Only 10% of schools in Sightlines’ database fund 50% of their

annual stewardship target. 50% of schools fund less than

20%.

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Total capital investment vs. annual funding targetsDalhousie has been spending at least into the target range since 2010

2007 2008 2009 2010 2011 2012$0.0

$10,000,000.0

$20,000,000.0

$30,000,000.0

$40,000,000.0

$50,000,000.0

$60,000,000.0

Total Capital Investment

Annual Stewardship Asset Reinvestment Target Need Life Cycle Need

Decreasing Backlog

Increasing Backlog

*Includes capital investment into existing space only

Stabilizing Backlog

Life Cycle Need

Target Need

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Dalhousie’s BacklogStrategic capital investment has stabilized campus backlog

FY11 one-time investment had a large impact on the backlog

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Longitudinal daily service and planned maintenanceProactive planned maintenance have increased more than reactive daily service

183% increase in PM spending

Peer Avg: $0.17

Peer Avg: $3.99

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Cost saving opportunity realized by switching to Nat GasOver $1M was saved in FY12 due to switching from fuel oil to Natural Gas

2007 2008 2009 2010 2011 20120

20,000

40,000

60,000

80,000

100,000

120,000

$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00Fossil Fuel Consumption and Cost

BTU/GSF $/MMBTU

BTU

/GSF $/M

MBTU

Despite increased consumption, switching to Natural Gas saved Dalhousie $1.2M in FY12

BTU

/GSF $/M

MBTU

If consumption was brought back down to FY11 levels, an additional

$400K could be saved yearly…

$This amounts to a total of

$1.6M in annual savings from switching to natural gas

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Age CategoryAverage hours/ DS

Work OrderLess than 10 2.75

10-25 2.525-50 5.0

Over 50 3.3

Opportunity to release operational FTEs Buildings between 25-50 yrs. old take longer to service

7,878 work orders/1 hour= 7,878 hours released!

Age CategoryTotal Daily Service

Work OrdersLess than 10 1,538

10-25 1,569 25-50 7,878

Over 50 4,748

7,878 hours/2080 hours (1 FTE)=

3.8 Maintenance FTEs

Reduce average work order time in 25-50 yr. old buildings by 1 hour.

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Operational strategies at Dalhousie University

76% of Dalhousie’s campus is over 25 years old. Space that exceeds 25 years often requires significant capital reinvestment and carries an elevated operational demand due to major building components due for replacement.

Dalhousie’s Annual Stewardship program is stronger than peers, funding 48% of target on average and focusing on core asset reliability and asset protection projects. Increases in Annual Stewardship and influxes of one-time capital have stabilized campus backlog since FY2009.

Utilities cost savings from shifting primary fossil fuels and increases in preventive maintenance have improved overall operational effectiveness.

Utilizing data in the work order system to aid in capital project selection and to discover areas that could release operational resources represents on opportunity to further improve operational effectiveness.

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Siena CollegeMark Frost, AVP Facilities Management

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Siena is a private institution located in upstate NYCampus profile

Total Gross Square Feet:1.25 Million GSF

Total Maintained Acres:175 Acres

Number of Buildings:64 Buildings

Student Faculty Ratio:12:1

Total Undergraduate Enrollment:3,214

Percent Out of State:19%

Institutional Information:

Catholic Franciscan Institution in Loudonville, NY founded in 1937

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Siena has 25% of space over 50 years oldGenerally favorable age profile relative to peers; Over 50 year old space is challenge

Siena College Peer Average0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

13%19%

39%17%

23%46%

25%18%

Under 10 10 to 25 25 to 50 Over 50

65%

% of Space by Age Category

Buildings Under 10Little work .“Honeymoon” period.

Low Risk

Buildings 10 to 25Lower cost space renewal updates and

initial signs of program pressures.Medium Risk

Buildings 25 to 50Life cycles are coming due in envelope and mechanical

systems. Functional obsolescence prevalent.Higher Risk

Buildings over 50Life cycles of major building components are past due. Failures

are possible. Core modernization cycles are missed.Highest RiskHigher Risk

Higher Risk

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Building intensity measures the size of facilitiesSmaller buildings on campus than peers challenges facilities operations

*Institutions ordered on the basis of density factor

Peer Average Database Average

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2006 2007 2008 2009 2010 2011 20120.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

$5.18 $5.05$5.54

$6.12 $5.90$5.28 $4.99

Siena Daily Service Peer Average Daily Service

Daily Service vs. Peer Averages

Dol

lars

per

GSF

Siena restricts daily service allocations over timeIn FY2012 budgets are aligned with peer averages but less resources are available

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Siena’s planned maintenance is 3% of operating budgetBelow peers but growing over time

FY08 FY09 FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12$0.00

$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

$0.35

$0.40

$0.45

$0.34$0.35

$0.39$0.36 $0.37

$0.05

$0.11

$0.22

$0.17 $0.18

Total Planned Maintenance

$/G

SF

Siena College:Peer Averages:

Siena Avg: $.15/GSF

Peer Avg: $.36/GSF

Siena College would need to increase planned maintenance investment by $250K each year to reach peer levels

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Strong energy management at Siena CollegeEnergy reduction enables Siena to reallocate savings into facilities operations

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Consistent capital investment is not enough to hit targets Backlog of need increases in spaces each year as investment targets are not met

2006 2007 2008 2009 2010 2011 2012$0.0

$2,000,000.0

$4,000,000.0

$6,000,000.0

$8,000,000.0

$10,000,000.0

$12,000,000.0

Total Capital Investment

Annual Stewardship Asset Reinvestment Target Need Life Cycle Need

Decreasing Backlog

Increasing Backlog

*Includes capital investment into existing space only

Stabilizing BacklogLife Cycle Need

Target Need

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Lack of investment yields an increasing backlogBacklog increased by over $20 M since FY06

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0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%Net Asset Value

Identifying highest-risk space on campusInternal study identifies areas to target with larger capital infusions

NAV = (Replacement Value – Backlog) Replacement Value

Under 10 10-25 25-50 Over 50

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Siena has less program space per studentFall 2013 will see the opening of Rosetti Hall aligning Siena to peers with academic GSF

Siena College Peer Average0

20

40

60

80

100

120

140

160

112 GSF

141 GSF

GSF

Siena College Peer Average0

50

100

150

200

250

199 GSF173 GSF

GSF

Siena College Peer Average0

10

20

30

40

50

60

70

80

72 GSF 70 GSF

GSF

Program Space Per Student Residential Space Per Student Student Life Space Per Student

Even at peer averages for space distribution, Siena feels overcrowded and confined with the current space available.

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Discovering key information from utilization analysisUtilization findings provide Siena insight into programmatic-driven challenges

Room Condition & Technological Inspection

Assessment of Institutional Scheduling Data

Use of Focus Groups to Determine User

Perceptions

End Result – Informed Decision Making

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Operational strategies at Siena College

Despite many younger buildings on campus compared to peers, 25% of campus is over 50 years old. Those oldest buildings will require significant capital infusions.

Solid Facilities metrics allows for more effective operations through planned maintenance growth and strong energy management at Siena.

Limited capital resources challenge Siena to hit annual investment targets. This is exposing lower quality space on campus and enabling growth in deferred maintenance needs.

Rosetti Hall coming online in Fall 2013 will address some of the immediate academic space needs. Classroom Utilization Analysis will help identify under-utilized space and classrooms that are not appropriately sized for program needs.

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Questions and Discussion