A Private Showing: Partnerships between Private Developers and IHEs Have Reached a New Level of Sophistication

By Sturgeon, Julie | University Business, October 2007 | Go to article overview

A Private Showing: Partnerships between Private Developers and IHEs Have Reached a New Level of Sophistication


Sturgeon, Julie, University Business


WHEN UPS NEEDED EMployees at its Louisville hub, the University of Louisville's (Ky.) students presented the perfect candidate pool. UPS sweetened the pot with full scholarships, a 401(k) plan, housing and book allowances, health care services, and union wages. But to be able to work odd hours through the night, students needed a place to crash where their comings and goings didn't disturb normal dorm activities. The state of Kentucky and the university saw one clear answer: bring in a private developer to create, finance, and operate a 1,200-bed housing unit.

It's yet another case of private developers charging to IHEs' rescue. Face it: most universities are land rich but lack equity and practical real estate experience. "Institutions don't want to be developers--they just want to be ranked number 1 in Newsweek," says Juan Reyes, a partner with Hartman and Craven law firm in New York. And when you also face budget struggles on a daily basis and wrestle with tough mandates from state appropriations officials, alternative ways to keep schools growing are music to administrators' ears.

Think of it as a way to get around being boxed in, says Charles Perry, president of Ambling University Development Group in Valdosta, Ga. Ambling's equity has translated to more than 25,000 beds in private housing across the country, and this company is just one player in this space.

No one jumped into this niche to be altruistic. Campuses offer stability, with a higher quality of neighborhoods surrounding them, says Glenn Weaver, director of development at Raleigh, N.C.-based Academic Privatization LLC. "Education is a government responsibility. Even if it's a private college, government is likely to provide future incentives to maintain the quality of the area," he says. Not to mention IHEs attract young professionals, who attract upscale retailers. That livability increases property value and makes the area more attractive to office developers, too. "Your cycle is spiraling upward rather than downward," Weaver adds.

Financially speaking, Perry sees the IHE market as a developer's sweet spot no matter what happens with loan interest rates. "The way these campus project bonds are sold and paid back through the rent, we don't see this niche being especially impacted by those forces," he says.

Finally, developers also receive a shelter from the storm of regulations in these deals. Thanks to an IHE's community facility standing, it represents a chance to break into residential areas typically deemed off-limits to ordinary commercial proposals, Reyes points out.

LEAVING HOME

Housing makes up the bulk of deals between developers and campuses, but that is changing. These partnerships also build:

* Research labs

* Office buildings

* Nursing homes near medical facilities

* Parking decks

* Auditoriums

* Retail strip centers

THE BREAK UP

It was The Three Musketeers, 21st century style: a housing developer, a local retail developer and Johns Hopkins University (Md.) agreed to build Charles Village, a complex of student housing and retailers that included Barnes & Noble and a credit union. The university would contribute the site and student consumers. The local developer would finance the building envelope; the housing specialist would put up the dough for the lodging and lease it back to JHU students for 40 years.

But as the pieces fell into place, the partnership fell apart. JHU needed a building that reflected a certain quality and design standard--after all, it was in this for a much longer haul than 40 years, says Larry Kilduff, executive director for facilities management at the university. Unfortunately, its vision and the housing developer's pocketbook weren't compatible. The firm couldn't build to those standards and charge enough in housing rates to cover the expenses. But no sweat, the officials reasoned. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

A Private Showing: Partnerships between Private Developers and IHEs Have Reached a New Level of Sophistication
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.