Kent State eyes debt-free $1B campus expansion plan
- Kent State University is looking to upgrade its campus landscaping, laboratories and academic facilities to the tune of $1 billion, but plans to do so without adding any debt to its current financial profile, Crain's Cleveland Business reports.
- To meet the mark, the university is requesting proposals from development vendors that include philanthropic elements for financing the projects. The elements include leasing opportunities and in-kind construction costs or fees. The plan is designed to help the university avoid ballooning debt that can grow through reduced state funding or deferred maintenance costs.
- The projects will also include a combination of privately raised and public funds to aid in keeping interest payments manageable. Kent State says it's using the "P4" model — a public-private-philanthropic partnership.
The P4 partnership could be a new model for colleges seeking expansion opportunities, while also working to create multiple revenue streams through diverse corporate partnerships. Requiring developers to include philanthropic support for construction is one element that saves a campus money in the short term, but that could also include longer-term packages, such as spacing options for potential use by regional companies that could be seeking more affordable and the exposure of being connected to large public or private institutions. The University of Hawaii's recent clean energy upgrades are examples of a kind of partnership that can yield long-term mutual outcomes.
Many campuses have begun using this model to advance their money-raising prospects, both on and off-campus like the University of Connecticut’s Entrepreneurship and Innovation Consortium, or Arizona State University’s Enterprise Partners, both of which seek external opportunities for business creation through initial investments from the respective schools.
Mixed-use space, entrepreneurship development centers and investment in green energy resources are just some of the ways in which institutions are looking to yield large revenues through short-term business creation and seed funding. By using these strategies, campuses are more likely to create public awareness of their value as tools of civic economic development, while reducing the need for debt servicing on campus upgrades and pressure on student tuition to make up differences.
- Crain's Cleveland Business Colleges aim to be debt-free as they upgrade campuses
- Education Dive College look to innovation as alternative revenue resource
- Education Dive Maui College poised to be a 'net-zero' campus