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higher education estates magazine (hee)

hee magazine digital edition - November/December 2017

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The HE market

Universities increase turnover via business driven developments

The UK university sector grew by £2bn in one year, and it annual turnover now equates to £30bn overall, according to the latest figures from the Association of University Directors of Estates (AUDE).

AUDE’s annual report, ‘Higher Education Estates Statistics Report 2016’, which spans the academic year 2014-2015, shows that teaching income had risen by 6% per annum, while income from research increased by 12%. The two largest institutions in the UK each turnover in excess of £1bn per annum.

Estates growth

The university estate equates to 14.3m sqm, which represents an increase of 200,000 sqm on the previous year. During this time, numbers of research students increased by 10,000 and staff numbers increased by 2,000.

Capital expenditure for the year reached a record high of £2.75bn. This growth of 5.6% on the previous year was driven by investment in the estate in the knowledge that staff and students expect high quality and attractive facilities.

The AUDE report reveals university estates continue to expand. Individually, the universities of Manchester, Cambridge, Edinburgh, Oxford and Nottingham all have academic estates (excluding residential accommodation) in excess of 500,000 sqm.

Commercial deals

Universities’ income rose to £1,477 per sqm in 2014/15. For example, the University of Hertfordshire embarked on a strategy to boost income by securing commercial deals with businesses such as Ocado and Regus for office space, as well as commercial leases with bank Santander and the NHS which runs a GP clinic on campus.

Across the sector, examples are documented by AUDE of universities exploiting their estates in order to secure alternative funding streams outside of traditional routes. The University of Sheffield built workshops, laboratories and office space in Catcliffe near the M1 in a business park. The capital expenditure in Sheffield Business Park will deliver 4,000 jobs and generate over £210m per annum to the regional economy when fully developed.

Goals for estates departments

Driving efficiency, reducing costs, improving the estate, raising service levels and increasing the commercial income from the estate remain key areas of focus for estate directors.

Ambitious infrastructure spend plans

In the face of challenging financial conditions, the HE sector wants to invest over £17.8 billion in infrastructure projects over the next four years, according to new figures from HEFCE. If achievable, this would represent an average annual investment of £4.5 billion, 51% higher than the previous four-year average.

Latest news

Universities paying up to 20 times over the trade price for IT

Universities paying up to 20 times over the trade price for IT  » 

IT suppliers managed to seize on chaotic price inflation following the Brexit vote to maximise their profits, according to the annual KnowledgeBus IT Margins Benchmarking Study.

Swansea University pioneers energy-generating offices  » 

The government has announced a £800,000 investment in Swansea University’s SPECIFIC Innovation and Knowledge Centre.

Overseas and postgraduate students driving UK student accommodation construction sector, says specialist

Overseas and postgraduate students driving UK student accommodation construction sector, says specialist  » 

Demand for student accommodation with increased amenities is continuing to grow across the country fuelled by overseas and postgraduate students, says property and cost consultancy Thomas & Adamson.

Russell Group calls for ‘sustainable’ funding levels  » 

Following the Government’s announcement of a review of university funding, Chief Executive of the Russell Group Dr Tim Bradshaw commented: “Funding levels are linked directly to the ability of universities to provide a high-quality learning experience for students.”

Other news

One-tenth of all property investment is in student accommodation, says JLL  » 

Student accommodation will take £1 of every £10 invested in commercial property this year, according to JLL. The property consultancy’s research indicates that £1.9bn has been invested in the student housing market so far this year, £200m more than the previous year.

Glasgow College makes Stirling Prize shortlist again

Glasgow College makes Stirling Prize shortlist again  » 

City of Glasgow College’s City campus has been shortlisted for architecture’s highest accolade, the Royal Institute of British Architects (RIBA) Stirling prize 2017.

Universities commit to upholding sustainability targets

Universities commit to upholding sustainability targets  » 

The Environmental Association for Universities and Colleges (EAUC) has launched a global initiative to embed the sustainable development goals (SDGs) across post-16 education. Announced at the World Congress on Environmental Education (WEEC) held recently in Vancouver, The SDG Accord is the university and college sectors collective response to the SDGs established by the United Nations.

Developers’ cash flow boosted by VAT ruling on student accommodation

Developers’ cash flow boosted by VAT ruling on student accommodation  » 

HMRC’s VAT policy on new build student accommodation has been successfully challenged in a case taken to the Tax Tribunal by Glyn Edwards, VAT Director at MHA MacIntyre Hudson.