Are estates fit for the future?

March 24, 2000

From now on, asset management will have to meet the the demands of environmental sustainability. Keith Blake investigates

The estate management strategies of England's universities are under review and sustainability is considered a key element. At the beginning of this year, the Higher Education Funding Council for England published a guide to good practice in estate strategies.

It focuses on environmental sustainability by including, as a reference point, improved environmental targets such as the reduction of energy consumption and carbon dioxide emissions, green transport plans and the design of sustainability into buildings.

At the same time, the main body of the document gives clear guidance to universities on how they can go about making better use of their land and buildings.

The two go hand in hand because no exercise in sustainability is effective unless it examines and puts into practice methods of improving the economic efficiency of the institutions.

They have to work better from a financial viewpoint because all educational funding has come under pressure in recent years. The institutions that will survive are those that increase their income and control outgoings at the same time as aiming to improve teaching quality.

The good practice guide makes clear that "an institution's estate is one of its most valuable assets. It creates the first impression of the organisation, so is a key element in marketing that institution".

While this applies to all universities throughout the country, the new universities are especially subject to scrutiny at this level. If they do not have a longstanding academic reputation to rely on, some have to be more diligent in selling the quality of their facilities in an increasingly competitive market.

The quality of the built environment and the facilities it provides at university level are all the more important because Hefce is asking colleges to put together their second five-year estate strategies.

Many of the old polytechnics were built in the 1960s, when system building created ugly curtain-walled multi-storey buildings. They were constructed with cheap building materials and were poorly insulated and poorly designed.

The university authorities will have to find ways of funding improvements to these institutions if they are not to fall behind. Parents and students do not look only for the appropriate courses but want modern facilities such as well-appointed residential accommodation, multi-sport complexes and good transport facilities.

The review process in many colleges around the country is already well under way. There is a general move towards the consolidation and merging of multi-sited universities that results in a number of surplus sites being offered to the private sector, particularly in large cities.

These sites can generate a substantial capital base for investing in new projects that will then be fully funded by commercial debt and other educational loans.

The ideal situation for a university with a number of sites is to examine the pros and cons of funding a single large campus, which would facilitate much of the univer-sity's needs over the next 30 years. However, this is often difficult to achieve due to the land requirement, which could be 50 acres or more.

Because universities have to competewith other purchasers for sites, they need to pay market prices for land and then be certain of creating the income to cover thecost of the interest on the loan.

In this situation, they have to be able to attract a wider fee-paying audience. That includes, for example, making sports facilities available to the local paying community, hiring out residential accommodationoutside the academic year and providing conferencing facilities that can be sold in the open market.

At Hertfordshire University, which has a student population now nearing 20,000, authorities have developed a programme with a clear, sustainable estates strategy. It involves consolidation onto a single campus, which is used both by students and the wider community.

The new campus will include accommodation for about 1,500 students,. It will also have teaching, conference and sports facilities.

These are all being master-planned with the objective of not only providing the highest quality of education but also providing facilities where revenue generation can be maximised.

The university has had a sustainable transport policy in place for many years, which developed as a result of the former polytechnic's set-up, with campuses in Watford, Hatfield and Hertford. It has connected the three sites with one of the most successful public transport companies in the country since the 1970s.

University Bus Ltd runs close to 40 modern buses, two coaches and 25 smaller mini-buses. It has a permanent staff of more than 100 and turnover has reached more than Pounds 3.5 million.

It ranks third in the county of Hertfordshire for providing buses, with 8 per cent of the market.

The service is offered to the public as well as students and teachers, and it has won private contracts to provide bus services to local schools. The company carries about 7,000 passengers a day, with a third of its turnover coming from the public.

Without the bus service, it is estimated that there would be an increase in car use by students alone of more than 1,000 trips, with the attendant traffic congestion that would cause.

Unless universities consider sustainability in its fullest context to include wider and more effective use of their building, they will be eclipsed by those who do.

Keith Blake is a partner in property consultants Fuller Peiser.

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