This document summarizes a webinar presentation on facilities trends in higher education and why major failures have been avoided despite growing challenges. The presentation reviewed data showing aging campus buildings, growing deferred maintenance backlogs, and insufficient capital funding increases to address needs. However, campuses have managed risks through better data to prioritize critical repairs, lower cost repairs extending asset life, risk diversification across building portfolios, and investments driven by space upgrades. Examples showed targeting oldest buildings, increasing preventative maintenance, and aligning long-term renewal plans with funding. This proactive management has helped higher education facilities avoid predicted failures while continuing to address growing reinvestment demands.

1. Wheaton College (MA)
Whitworth University
Widener University
Wilkes University
Williams College
Worcester Polytechnic Institute
Worcester State College
Wright State University
Xavier University
Yeshiva University
Youngstown State University
Why the Roof Hasn’t Caved In
Sightlines Webinar; Presented by Jim Kadamus
December 3, 2015

2. Review of facilities trends – Space, capital, and operations;
including 2014 CAUBO study of deferred maintenance for
Canadian Universities
Identify what the trends tell us about the State of Facilities in
Higher Education institutions
Explore the reasons for why the roof has not caved in despite
the “bad news” trends and dire predictions
Examples from campuses that are successfully combating the
challenges
Recommendations and conclusions
Agenda
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3. Feel Free to “Ask Sightlines”
Enter questions in the box at any time
Enter questions
here at any
point during the
webinar
Presentation slides
and webinar
recording will be
sent to each
attendee following
today’s session
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4. National Trends & The
State of Facilities

5. By the Numbers – Sightlines Database
343 Higher Education Member Institutions
Public,
60%
Private,
40%
1.5 Billion Total GSF
2,601,261 Students
educated at included
institutions
51 Institutions Represented in 2014
CAUBO Study
4,364 building totaling
over 200M GSF
Over 860,000 students
educated at included
institutions
$8.4 billion of total
deferred maintenance
identified
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6. The Sightlines’ Paradigm
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7. Space and Enrollment Growth
Space growing faster than enrollment
0%
2%
4%
6%
8%
10%
12%
2007 2008 2009 2010 2011 2012 2013 2014
Space and Enrollment Growth
(National Average in United States)
Space Growth Enrollment Growth
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8. 0%
5%
10%
15%
20%
25%
%ofConstructedSpace
Putting Campus Building Age in Context
The campus age drives the overall risk profile
Pre-War
Built before 1951
Durable construction
Older but typically lasts
longer
Post-War
Built between 1951 and
1975
Lower-quality
construction
Already needing more
repairs and renovations
Modern
Built between 1975 and
1990
Quick-flash construction
Low-quality building
components
Complex
Built in 1991 and newer
Technically complex
spaces
Higher-quality, more
expensive to maintain &
repair
Pre-War Post-War Modern Complex
Percent of Total
Space
U.S. 35%
Canada 48%
Percent of Total
Space
U.S. 31%
Canada 28%
Constructed Space – U.S. Constructed Space – Canada
7

9. Square Footage by Age Category - CAUBO
25%
12%
19%
25%
41%
37%
15%
26%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2018
%ofSpace
CAUBO Age Profile
Under 10 10 to 25 25 to 50 Over 50
Buildings Under 10
Little work. “Honeymoon” period.
Low Risk
Buildings 10 to 25
Short life-cycle needs; primarily space
renewal.
Medium Risk
Buildings 25 to 50
Major envelope and mechanical life cycles come
due.
Higher Risk
Buildings over 50
Life cycles of major building components are past due.
Failures are possible.
Highest risk
Unless substantial investment occurs, space over 50 years old projects to double
8

10. Annual Capital Investment
2014 levels finally reach pre-recession, but with a different funding mix
$1.19 $1.18 $1.27 $1.24 $1.36 $1.50 $1.71 $1.77
$3.18
$3.63
$3.86
$3.22
$3.58 $3.44
$3.45
$3.60
$0
$1
$2
$3
$4
$5
$6
2007 2008 2009 2010 2011 2012 2013 2014
$/GSF
Capital Investment into Existing Space
(National Spending in United States)
Annual Capital One-Time Capital Average
9

11. Sightlines’ Impact on Capital Spending
2011 new members’ capital spending before vs. after joining Sightlines
$0.72
$1.11
$3.29
$3.30
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$4.50
$5.00
Before After
$/GSF
54% Increase
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12. Facilities Backlogs Continue to Rise
Backlog $/GSF
Public Average Private Average
0%
5%
10%
15%
20%
25%
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
2007 2008 2009 2010 2011 2012 2013 2014
$/GSF
0%
5%
10%
15%
20%
25%
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
2007 2008 2009 2010 2011 2012 2013 2014
Capital investment not enough to keep backlogs from growing
Avg. CAUBO backlog Avg. CAUBO backlog
With $8.4 billion of DM, total CAUBO backlog would average at approximately $85/GSF
11

13. Facilities Operating Budget
Daily Service & Planned Maintenance
3.99 4.20 4.20 4.15 4.23 4.23 4.36 4.49
0.28
0.28 0.29 0.29 0.30 0.32 0.34 0.35
-
1.00
2.00
3.00
4.00
5.00
6.00
2007 2008 2009 2010 2011 2012 2013 2014
$/GSF
Facilities Operating Budget
(National Average in United States)
Planned Maintenance Daily Service
12

14. Summary of Trends
The aging campus is driven by the need to renovate or replace 1960s and 70s
buildings, many of which were poorly constructed
To add to the problem, campuses have added new square footage to address
increasing enrollment that has now leveled off or is even in decline
The demand for both “catch up” on aging buildings and “keep up” of newer buildings
is much higher than the availability of capital funding
Therefore, backlogs continue to grow even though capital funding is finally back to
pre-recession levels
Flat operating budgets have not provided relief to the backlog problem
In the face of these “bad news” trends, why have we not seen more building
failures and major facility problems on campuses?
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15. Why the Roof Hasn’t Caved In
& Campus Successes

16. The Predictions Have Not Become Reality – Why???
15

17. Better data to identify and manage the most critical
repair risks for campus.
Systems tend to outperform their statistical target.
Lower cost repairs to systems rather than full system
replacements have bought extra service time.
Because campuses are a collection of buildings –
the risk is diversified over the portfolio.
The functional obsolescence of space drives
investments that brings outside resources, especially
to space.
What are Campuses Doing to Manage Risk?
To keep the roof from caving in and building systems from failing
16

18. Better data to identify and manage the most critical
repair risks for campus.
Systems tend to outperform their statistical target.
Lower cost repairs to systems rather than full system
replacements have bought extra service time.
Because campuses are a collection of buildings –
the risk is diversified over the portfolio.
The functional obsolescence of space drives
investments that brings outside resources, especially
to space.
What are Campuses Doing to Manage Risk?
To keep the roof from caving in and building systems from failing
17

19. State System Sets Priority on 1960-70s Buildings
19% 20% 20% 20% 21% 21% 21% 21% 20% 20% 19% 19% 17% 20% 20% 20% 22% 23%
29% 30% 30%
35% 37% 37%
14% 14% 13% 13% 13% 14% 14% 14% 14% 14% 15% 16%
10%
10% 10% 12%
14%
14%
15% 16% 17%
17%
18% 20%
47% 47% 46% 46% 45% 43% 42% 40% 40% 40% 38% 36%
59% 57% 57% 56%
53% 50%
44% 41% 38%
34% 31% 29%
20% 20% 20% 20% 21% 22% 23% 25% 25% 26% 28% 29%
13% 13% 12% 12% 12% 12% 12% 13% 14% 14% 14% 14%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
%ofTotalCampusGSF
Renovation Age by Category
Under 10 10 to 25 25 to 50 Over 50
Peers State System
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20. $0.00
$0.05
$0.10
$0.15
$0.20
$0.25
$0.30
$0.35
$0.40
$/GSF
Planned/Preventive Maintenance
$/GSF
Impact of Renovating or Replacing 1960-70s Buildings
76% 77%
79% 79% 80% 81% 82% 82%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2008 2009 2010 2011 2012 2013 2014
Campus Inspection Index
19

21. Identified Needs by Category
Categorizing the $151.6 M in total campus needs; building needs are heavily in A timeframe
$130.5 ,
86%
$15.3 ,
10%
$5.8 ,
4%
Total Needs by Structure
$ in millions
Building Needs Infrastructure
Grounds Needs
$84.0
$2.3 $0.7
$27.4
$3.5 $10.4
$19.1
$0.1
$4.2
$0
$20
$40
$60
$80
$100
$120
$140
Building Infrastructure Grounds
TotalNeed,$inmillions
Total Needs by Structure and Timeframe
A (1-3 years) B (4-7 years) C (8-10 years)
20

22. 7%
9%
55%
1%
28%
Campus Identified Needs
Reliability
Safety/Code
Asset Preservation
Economic Opportunity
Program Improvement
Identified Needs by Investment Criteria
Timeframes A, B, & C only
8%
11%
48%
3%
30%
Comparison Campuses
Reliability – Issues of imminent failure of compromise to the system that may result in interruption to program or use of
space.
Safety/Code – Code compliance issues and institutional safety priorities or items that are not in conformance with
current codes, even though the system is “grandfathered” and exempt from current code.
Asset Preservation – Projects that preserve or enhance the integrity of buildings systems or building structure, or
campus infrastructure.
Economic Opportunity – Projects that result in a reduction of annual operating costs or capital savings.
Program Improvement – Projects that improve the functionality of space, primarily driven by academic, student life, and
athletic programs or departments. These projects are also issues of campus image and impact.
21

23. Identified Needs Compared to Investments
Identified needs means shift in future funding allocations
17%
41%
14%
19%
9%
Campus Identified Needs
10%
21%
23%
39%
7%
Historical Project Investments
FY03-FY14
Building Envelope
Building Systems
Infrastructure
Space Improvement
Safety/Code
22

24. Better data to identify and manage the most critical
repair risks for campus.
Systems tend to outperform their statistical target.
Lower cost repairs to systems rather than full system
replacements have bought extra service time.
Because campuses are a collection of buildings –
the risk is diversified over the portfolio.
The functional obsolescence of space drives
investments that brings outside resources, especially
to space.
What are Campuses Doing to Manage Risk?
To keep the roof from caving in and building systems from failing
23

25. Aligning Facilities Renewal Needs with Resources
$295
$103
$186
$378
$0
$100
$200
$300
$400
$500
$600
10 Year Need, FCA $ + soft cost
Millions
5-Year Need Current Need
Need Years 5-10 Lifecycle
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Millions
10-Year Facilities Renewal Needs
including soft costs
10-Year Facilities Renewal Needs
including soft costs
*Backlog quantified by FCA analysis
24

26. Gap Between Facilities Need and Resources
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Millions
Systems Exterior Interior
*Backlog excludes programmatic needs.
10-Year Facilities Renewal Needs
Projected funding based on last 5 years of spending
$481
$250
$0
$100
$200
$300
$400
$500
$600
10-Year Need Projected
Funding
Millions
Need vs. Funding
25

27. Gap Between Facilities Need and Resources
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Millions
Lifecycle Current Need
Average Funding, FY10-14 Grow Funding by $3M/year
10-Year Facilities Renewal Needs
including soft costs
$481
$250
$0
$100
$200
$300
$400
$500
$600
10-Year Need Projected
Funding
Millions
Need vs. Funding
including soft costs
Any needs above the
funding line would be
added to the backlog in
future years
*Backlog quantified by FCA analysis
26

28. Better data to identify and manage the most critical
repair risks for campus.
Systems tend to outperform their statistical target.
Lower cost repairs to systems rather than full system
replacements have bought extra service time.
Because campuses are a collection of buildings –
the risk is diversified over the portfolio.
The functional obsolescence of space drives
investments that brings outside resources, especially
to space.
What are Campuses Doing to Manage Risk?
To keep the roof from caving in and building systems from failing
27

29. Needs by Building Portfolio
Total Project
Inventory
$1,854 M
New Space
$341 M
Building Needs
$1,443 M
Transitional
Facilities
$171 M
Building
Renovation
$505 M
Repurpose
$39 M
Maintain
$735 M
Non-housing
facilities
$551 M
Housing facilities
$183 M
Site &
Infrastructure
Needs
$70.3 M
28

30. Asset Reinvestment Progress
Significant investments in new and existing space in 2014
$1,974 $1,895 $1,792
$1,627 $1,607 $1,497 $1,443
$126
$107
$82
$82 $82
$77 $70
$457
$434
$410
$571 $541
$442
$341
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
April 09 Update Fall 09 Update June 2010
Update
June 2011
Update
June 2012
Update
June 2013
Update
June 2014
Update
Millions
BPS Identified Needs by Update Stage
Building Needs Infrastructure New Space
$500M+ of Asset Reinvestment need
addressed since FY09 through O&M,
capital investment/renovation, and
demolition of aging facilities
29

31. Better data to identify and manage the most critical
repair risks for campus.
Systems tend to outperform their statistical target.
Lower cost repairs to systems rather than full system
replacements have bought extra service time.
Because campuses are a collection of buildings –
the risk is diversified over the portfolio.
The functional obsolescence of space drives
investments that brings outside resources, especially
to space.
What are Campuses Doing to Manage Risk?
To keep the roof from caving in and building systems from failing
30

32. Blended Functional and Investment Portfolios
Aligning needs with funding opportunities
Total Needs
$253.9M
New
Construction
$83.3M
Grounds &
Infrastructure
$11.3M
Building Needs
$158.3M
Institutionally
Funded
Academic
$41.7M
Administrative
$18.9 M
Sci./Research
$33.9 M
Athletic
$11.6 M
Residence
Halls
$18.0 M
Faculty/Staff
Housing
$10.9 M
Fraternities &
Sororities
$9.0 M
Transitional
$14.2 M
Potential Grants Potential Gifts Potential to Sell Potential Gifts
Focus investment
into core campus
facilities that are
unlikely to receive
donor funding
31

33. Increasing Capital Investment Over Time
Investing capital in envelope and mechanical; using department dollars for space upgrades
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
2007 2008 2009 2010 2011 2012 2013 2014
$inMillions
Envelope Systems Infrastructure Space Renewal Safety/Code
Life Cycle
Need
($74.3M)
Target
Need
($38.9M)
Stabilizing/Decreasing
Backlog
Total Capital Investments FY2007 – FY2014
32

34. Recommendations and
Conclusions

35. We Need to Make the Problem Smaller
Not all buildings are created equal, therefore they
should not be treated that way.
Use building portfolios – for operations and capital - to
make the problem smaller
Subdivide capital projects by issues of reliability,
safety/code, program, and asset preservation.
Create “balance” and “diversity” in all facility
investments to lower risks.
34

36. Time is On Our Side
Yes it is
What we’ve learned over the past 30 years …
fixing components rather than replacing entire systems,
that life cycle estimates are inherently conservative,
coordinating campus needs and projects can lower capital costs,
and
functional obsolescence of space can bring capital resources to
allocate for repairs
There is no reason to believe that these factors will change
in the next 15 to 20 years. Therefore although we will need
to act, we have time to manage the investments.
35

37. Make the Case for Resources
By controlling the things you can control
The old approach of defining needs in a way that makes the DM
problem bigger and then requesting money will not work.
Problem is too big to address in total – must break it down in size
and priority
Opportunities exist to…
Lower Demands - Space Management
Make the Problem “Smaller” – Use Building Portfolio
Management
Sustain Impact of Finite Funding - Create Multi Year Plans
Mitigate Risk - Target Capital to Reliability, Safety/Code, and Critical
Asset Preservation Issues
Apply these actions to make the case for additional
funding and use savings to self-fund stewardship
36

38. Questions & Discussion

39. 2015 State of Facilities in Higher Education
Annual report available now! Webinar on December 10
www.sightlines.com/insight/state-of-facilities-2015
Webinar: The State of Facilities in
Higher Education – An In-Depth Look at
the 2015 Trends and Best Practices
December 10, 2015 @ 1pm EST
Invitation to follow today’s session!
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