This document discusses challenges related to aging campus facilities and budgets for repairs and renovations. It provides the following key points: - Over 1.2 billion square feet of campus space is tracked across more than 380 institutions, with 55% being public and 45% private. Nearly half of total space is over 25 years old. - Capital budgets for repairs were cut more at private institutions after 2009 but recovered quicker, while public institution budgets have remained flat or increased slightly. - Despite preventative maintenance and capital investments, the repair backlog has continued to rise an average of 16% each year across institutions. - Campuses have shifted investments more toward durable renovations of building envelopes and mechanical systems rather

1. Budgets, Buildings, and Balance Sheets –
Staying Ahead of the Crumbling Campus
David Kadamus, Sightlines LLC
Lee White, GK Baum
David Hanson, Virginia Commonwealth University
Craig Woody, University of Denver

2. SIGHTLINES NATIONAL TRENDS

3. Introducing the Comparative Institutions
International Database:
Over 380 institutions in 41 states,
Washington DC., & Nova Scotia
Public Institutions: 55%
Private Institutions: 45%
Over 1.2 billion square feet in our database
Context through
benchmarking
Consistent analytical
methodology
Common facilities
vocabulary

4. Facilities Physical Age Profile: Public & Private
Two building types are going through life cycle needs
Public Private
46% 45% 44% 44% 43% 42%
34% 34% 33% 32% 31% 29%
14% 15% 15% 16% 17% 18%
23% 23% 23% 24% 24% 27%
70%
60%
50%
40%
30%
20%
10%
0%
2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012
% of Campus Space
(%) Square Footage over 25 years old
(Renovation Age)
25 to 50 Years of Age Over 50 Years of Age

5. Facilities Physical Age Profile: Age vs. Era
Differing life cycle needs of each vintage category, but competing for the capital $
21%
32%
19%
15%
35%
35%
24%
18%
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Construction Age Construction Era
% of Space
Construction Age vs. Construction Era
Under 10 10 to 25 25 to 50 Over 50
Overall
Database
Complex Modern 60’s Style Pre-War
•Built before 1951
•Durable construction
•Older but typically lasts longer
•Built between 1951 and 1975
•Lower‐quality construction
•While newer than pre‐war,
already needing more repairs
and renovations
•Built between 1975 and 1990
•Quick‐flash construction
•Low‐quality building
components
•Built after 1991 and newer
•Technically complex spaces
•Higher quality, more expensive
to maintain and repair

6. Capital Budget Profile
Private institutions cut capital deeper but recovered quicker from FY2009
Public Private
$3.0
$4.0
$4.2
Capital Investment into Existing Space
$3.6
$3.7 $3.5 $3.5
$4.0 $4.0
$2.8
$3.0
$3.2
$1.0 $1.2 $1.3 $1.1 $1.3 $1.4 $1.5 $1.5 $1.5 $1.5 $1.8 $2.0
$6.0
$5.0
$4.0
$3.0
$2.0
$1.0
$‐
2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012
Annual Capital One‐Time Capital

7. The Risk… A Growing Capital Backlog
Despite changes in capital investment, and increased PM, backlog continues to rise
16%
14%
12%
10%
8%
6%
4%
2%
0%
2007 2008 2009 2010 2011 2012
% Change in Backlog
Increasing Backlog
Percentage Change of Backlog
Overall
Database

8. The Changing Investment Profile
Campuses have changed investment strategies to durable & longer lasting projects
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2007
2012
46%
38%
54%
62%
Capital Investment into Existing Space
Space Renewal Envelope/Mechanical

9. Forecasting facility investment risk
$35
$30
$25
$20
$15
$10
$5
$0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Millions
Discovery
Historic Capital Trends vs.
Target
Prediction
Future Capital Needs
“Risk”