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Big-Picture Rewards

December 2016

By Herman Bulls, Amanda Hoffsis, and Steven Swant

Universities are completing ambitious revitalization projects, turning dilapidated spaces into mixed-use, live-work-play neighborhoods. Two institutions share how their initial vision turned into a community success.

Unlike private-sector real estate developments, ambitious university projects nearly always reach beyond basic financial returns, as institutions invest in much more than “just a building” for their students, professors, and communities. Like a shiny silver dollar, a newly completed campus project can create a lot of buzz. Yet, the initial face value of a thoughtful mixed-use university real estate development only scratches the surface of long-term value. The true achievements of successful campus—or off-campus—transformation projects are revealed over time.

Return on investment that considers things like student achievement impact, improvements in university reputation, and positive effects on the surrounding community often can be quantified only years after ground is broken and ribbons are cut. Powerful long-term outcomes beyond the purely financial are not unusual for university developments that look past the traditional notion of creating an ivory tower and toward enriching the larger community.

The opportunity is clear: A vital university community, anchored by a respected, modern campus, can not only nourish the local economy, but can also add to its appeal for students, parents, and world-class faculty alike. Creating inviting spaces for industry can not only drive research innovation, but also can boost university rankings.

Sounds good in theory, but is it realistic to expect such big-picture rewards? Consider this tale of how two very different universities both achieved long-term positive impacts on their surrounding communities, student populations, and their institutions as a whole—impacts that were not yet quantifiable when their new buildings opened their doors. Both The Ohio State University, Columbus, and the Georgia Institute of Technology, Atlanta, answer the question of big-picture rewards with a resounding yes—because they’ve achieved such rewards themselves over the past decade.

Back in the 1990s, Georgia Tech had an ambitious vision: transform a dilapidated, eight-acre site in Atlanta’s depressed Midtown district into a vibrant urban village and gateway to the campus. The result: The Institute was able to turn a neglected corner of urban Atlanta into a hot spot and national technology cluster, while transforming the institution’s business school from a regional player to a nationally ranked, competitive destination.

Meanwhile, in Columbus, The Ohio State University sought to revitalize its surrounding University District community to improve the campus experience. A decade later, the emergence of the vibrant, mixed-use, live-work-play neighborhood development with high-quality housing options for students, faculty, staff, and local residents has also improved corporate and community engagement.

Georgia Tech’s Urban Village Boosts Innovation Reputation

Thirteen years ago, Business Officer called Georgia Tech’s Technology Square development “one of the most impressive urban and academic revitalization efforts in the country” (Business Officer, “Georgia Tech Squared,” January 2003). The project required jumping 14 lanes of interstate, which had for approximately 40 years cut off the university from Atlanta’s Midtown district, to convert eight acres of underused land into a 1.4 million–square-foot, mixed-use urban village.

Georgia Tech’s Crum and Foster data center blends high-tech with traditional design.

A Multilevel Vision

Georgia Tech’s leadership envisioned a live-learn-work-play environment for the multiblock campus that would fuel innovation by nurturing natural connections between business and academia, and give university members space to connect with the larger commercial, government, and nonprofit world. It also looked to create an inclusive and supportive neighborhood for its economic development and business outreach efforts, as well as a highly visible location for continuing education and alumni engagement. Another priority was to create a new facility for the Scheller College of Business.

Georgia Tech’s Hotel and Conference Center overlooks Midtown Atlanta, and includes 23 meeting rooms and 252 guestrooms.

Tangible results. Today, the outcomes have far exceeded the Institute’s expectations. As of July 2016, the eight-block Technology Square campus was nearing three million square feet of mixed-use space, including the new NCR Corporation’s world headquarters under development; and Tech Square Lab, an incubator, seed fund, and 25,000-square-foot working and corporate innovation space. Tech Square, as it is now known, is home to eight buildings housing the Scheller College of Business; a state-of-the-art facility for the Institute’s professional education program; other amenities such as the Georgia Tech Hotel and Conference Center; and a Barnes and Noble bookstore, along with restaurants, shops, condominiums, and office space.

With more than 100 startup and innovation companies focused on interdisciplinary research, Technology Square has helped the university build its reputation as a premier technological university by providing a place for public-private collaboration backed by world-class research facilities. Midtown has become a thriving area hosting academic, public-sector, and private-sector organizations with the buzz of a vibrant technology hub. This was all made possible by the university’s willingness to invest in neighborhood transformation.

As of summer 2016, 18 high-rise projects were under construction in Midtown Atlanta, and Tech Square is rapidly solidifying its position as one of the country’s top innovation districts.

Building on success. With a solid foundation in place, Georgia Tech is well-positioned to launch the second phase of Technology Square. A private developer will build the approximately 750,000-square-foot Coda tower, which represents a $375 million investment. It will house 620,000 square feet of office space; an 80,000-square-foot High-Performance Computing Center operated by Next Tier HD; and will also include retail amenities once complete.

Georgia Tech plans to occupy approximately 50 percent of the Coda building. The project is estimated to have an economic impact of $813.8 million as well as creating 2,100 jobs during construction and 2,400 jobs on site after completion. The university also envisions a long-term boost to innovation in the area. In addition, the Georgia Tech Foundation recently purchased the approximately 290,000-square-foot historic Biltmore office building.

Big Picture and Beyond

Other long-term results from Georgia Tech’s original vision include:

The Scheller College of Business joins seven other buildings to form Tech Square.

Ohio State Invests in Campus and Community

New or reconstructed homes are sold to moderate-income families.

Ohio State’s Columbus campus has been a center of academic achievement for 144 years. But back in 1995, the distressed neighborhoods surrounding the campus kept more than half of the school’s 48,000-strong student body living in the suburbs rather than on or near campus.

Instead of separating the university from the community, university leadership decided to invest in the University District, encompassing approximately 300 blocks in about 2.5 square miles near Ohio State and home to more than 30,000 residents.

Revitalizing the district with academic, office, retail, and housing facilities, while improving neighborhood housing, would enhance the overall university and community experience and attract students and faculty.

The university’s strategic plan included the South Campus Gateway, a major new mixed-use development that could stimulate private real estate investment and help create an attractive neighborhood on the university’s south side. In addition, the university wanted to improve housing near the campus and create safer, livelier neighborhoods that would appeal to faculty, students, and long-time residents alike.

Making It Happen

Visionary collaboration was vital to this endeavor, so the university partnered with the City of Columbus to create Campus Partners for Community Urban Development, a nonprofit group to manage the ambitious real estate projects. Their successful collaboration culminated not only in the profitable South Campus Gateway, but also in the Weinland Park neighborhood initiative on Ohio State’s east side that has since become a national model for town-and-gown urban revitalization.

Initially, Campus Partners facilitated the acquisition of the nation’s largest portfolio of low-income housing—the Broad Street Portfolio of 1,335 Section 8 housing units located in the University District and in neighborhoods throughout the City of Columbus—by a nonprofit, affordable-housing management company committed to neighborhood stabilization. In 2006, community leaders, Campus Partners, and the City of Columbus together developed the Weinland Park Neighborhood Plan. Many partners—private, public, and philanthropic—joined Campus Partners and the City of Columbus to address a wide range of needs in the neighborhood including public safety, education, workforce development, health, resident engagement, youth development, and housing.

Today, Weinland Park is a showplace for integrating affordable and market-rate housing in a diverse and appealing community. South Campus Gateway, meanwhile, now comprises four buildings on a 7.5-acre site with more than 225,000 square feet of retail space, 88,000 square feet of offices, 184 apartments, and a parking garage with 1,200 spaces in Columbus’s now-lively High Street Corridor. The project is anchored by a flagship university bookstore, an eight-screen film center, and a unique array of restaurants.

Several organizations have validated Ohio State’s approach—the American Planning Association awarded Campus Partners a 2010 National Planning Excellence Award for Implementation, and South Campus Gateway was selected as a finalist in the 2010 Urban Land Institute’s Awards for Excellence, among other recognition.

Continuing Collaboration

Campus Partners is already hard at work on the next phases of investment in the University District. In June 2016, the organization unveiled plans for a complete remake of the intersection of 15th Avenue and High Street—the historic entrance to the university—to include retail, office, housing, a 150-room hotel, and a public University Square.

The collaborative planning effort works congruently with Ohio State’s vision on the west side of High Street, where an Arts District Master Plan will one day showcase music, art, and theater programs from across the university. This collaboration is thought by some to be a once-in-a-generation opportunity to provide connectivity between the university and the community—creating a place for art and culture.

Other long-term results from Ohio State‘s original vision include:

A $43 million Neighborhood Stabilization Program grant from the City of Columbus enabled the renovation or construction of 20 homes in Weinland Park, near The Ohio State University.

Innovative Development Isn’t Instantaneous

At each of the two universities, the outcomes of their ambitious visions have become clear over time in ways not immediately visible when the first phase of development was completed. Critical to these outcomes were some key factors that should be top of mind for other institutions considering investing in major real estate development projects.

Ohio State’s South Campus Gateway development was funded by a combination of university capital, tax-exempt bonds, New Markets tax credits, tax-increment financing, and city-state infrastructure grants. At Georgia Tech’s Technology Square, the project team created different financing structures for each component of the campus.

The Gateway Film Center is one of the many venues accessible to the OSU campus community, and residents of the nearby areas.

As Georgia Tech and Ohio State have found, world-class institutions can win recognition not only for great research, but also for their business and economic impact, appealing environments, and walkable neighborhoods accessible to the campus community and residents of the surrounding areas. Attractive retail, dining and lodging options give students, faculty, and the community as a whole more reason to spend their dollars on campus and in adjacent neighborhoods. Stronger connections between public and private innovators can help build reputation, attract private investment and create mutually beneficial town-gown relationships.

With Ohio State and Georgia Tech as inspiration, it is becoming increasingly clear that university transformation projects can support revenue goals as well as improve campus experiences when project stakeholders adopt a long-term view. The challenge, of course, is that even the most brilliant renderings and savvy budgeting won’t win administration and trustee support. A well-thought-out plan, backed up by realistic financing strategies and a long-term view, is essential.

Fortunately, in the academic world, taking the long view comes naturally. Academia is all about lasting ideas, and the notion of a university spurring business innovation and community engagement is a proven winner.

HERMAN BULLS is vice chairman, Americas, and international director and founder of JLL’s public institutions business unit, Washington D.C. AMANDA HOFFSIS is president, Campus Partners, and senior director of planning and real estate, The Ohio State University, Columbus; and STEVEN SWANT is executive vice president for administration and finance, Georgia Institute of Technology, Atlanta. Kevin Wayer, co-president of JLL’s public institutions group; and David Hock, co-leader of JLL’s higher education group, also contributed to this article.