(06-30-2017 11:10 AM)BearcatJerry Wrote: (06-30-2017 10:39 AM)SuperFlyBCat Wrote: (06-30-2017 07:31 AM)rath v2.0 Wrote: Yikes. UC carries about $1.2 billion in debt on about a $1.2 billion annual budget.
Paying about $80 million a year in debt servicing.
Yes a lot of that comes capital projects building new buildings. State universities really need to totally rethink how they do this.
And the greater part of that debt load is bonded...which means it is financed and secured debt.
It's not like the University has been running around like a drunken student, running up the credit card with no clue how to pay it off.
Of course, but their are ways to utilize space better and forego spending. Most universities that need newer dorms housing, they just do a long term ground lease to a developer who builds the new building, and then the University gets some of the rent revenue. Zero risk or spending involved, maybe UC has done this in a couple of places IDK. And some buildings are designed way to user specific, with massive wasted common areas, like 40% of what is under the roof in not usable. How a department needs to utilize space or the building can do a 180 in less that 10 years.
For new construction one of the main design criteria should be super easy ability to renovate that building to another end use X amount of years down the road.
In the private market in the late 70's and early 80's developers built office buildings with super large atriums and common areas, looks nice, but when you lease space in that building you pay for that. As example you might be paying on 24,000 RSF, but you are locking up a suite that is 20,000 RSF.
Another example is Usqaure at the loop (don't get me started on the original money UC put up to make that happen), UC should have required that much more office space was built there, they have all of the 40,000 RSF. There should have 100,000 RSF, as an additional 60,000 RSF can be used as ongoing swing space when other areas are under construction. Heck they could have had the law school built there under a lease, lots of Law Schools are like this now. It would have been much more cost efficient than building new. They almost made that mistake at the Banks, owning it not leasing it.