Maximizing the University s Physical Assets (Part I): Facility Condition Assessment

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1 Maximizing the University s Physical Assets (Part I): Facility Condition Assessment Board of Regents Facilities and Operations Committee September 12, 2013

2 Agenda Program background Broadening our data and tools Balancing facility needs with funding challenges A new approach Questions and discussion 2

3 Policy Questions for the Board What percent of University resources should be allocated to facilities? What is an appropriate [minimum] condition standard for individual buildings, or portfolios of buildings (age, type, programs served, etc)? What is the best approach to stop adding to the backlog (e.g. maintenance endowments for new buildings)? 3

4 Background: Systemwide Facilities Million Gross Square Feet Research and Outreach Centers & Field Stations 4

20 15 10 5 5.4M 26% 6.2M 30% 2.9M 14% 6.

8M 30% Age in Years Over 50 26 to 50 11 to

5 Campus Age Profile 25 Addition of new buildings has minimal impact GSF in Millions M 26% 6.2M 30% 2.9M 14% 6.5M 30% 6.1M 28% 6.5M 30% 6.6M 29% 6.4M 28% 6.8M 30% Age in Years Over to to 25 Under M 30% 2.7M 12% 2.9M 13%

6 Outstanding Organization University Goal Outstanding Organization; Be responsible stewards of resources, focused on service, driven by performance, and known as the best among peers. University Strategy Be responsible stewards of resources Key Indicator Facilities Condition Measure Facilities Condition Needs Index (FCNI) 6

7 Facilities Condition Assessment (FCA) Vision: The enterprise source of the most accurate and up-to-date condition information for campus facilities and infrastructure used to ensure effective operations and guide renewal investments. Operationally: An independent, inspection based review of building conditions Report prioritizes needs for facilities renewal over next ten years Database provides a tool for accessing and utilizing data Information used to measure long term facilities condition against established metrics and peers 7

8 Facility Planning Drivers Programmatic Needs Facility Conditions Space -Correct Type -Optimal Quantity -Appropriate Condition 8

9 What is Assessed Roofing Foundations Windows Walls Doors Structure Interiors Walls, Doors Ceilings Elevators Stairs Interior Finishes Classrooms Equipment Ductwork Piping Controls Component List Equipment Power Distribution Interior Lighting Exterior Lighting Security Building Exterior Building Interior HVAC Electrical Equipment Fixtures & Hardware Domestic Water Drain, Waste, Vents Storm Drains Equipment Alarm Systems Sprinkler Systems Stand Pipes Walkways Plazas (select) Lighting Int l Building Code State Code MN Accessibility Code Universal Accessibility Plumbing Fire / Life Safety Site Code / Accessibility 9

10 Broadening Assessments Percent (%) of Campus Assessed Pre Twin Cities 91% 94% Duluth 60% 72% Morris 96% 96% Crookston 52% 83% 1 ROCs 0% 53% 2 Total 82% 90% 1 Represents ~90% of ROCs FCA Eligible facilities (those with mechanical, electrical, plumbing systems). 2 Includes formally inspected space and new/remodeled space <5 years old. Also includes SF for parking ramp decks. 10

11 Facilities Condition Assessment updated 2013 (System-wide) Campus Total GSF 1 Estimated Replacement Value Projected 10-Year Needs 10 Year Needs/Replacement Value = (FCNI) Twin Cities 22,405,496 $7,077,426,098 $2,443,793, Duluth 3,264,295 $677,093,369 $196,133, Morris 965,276 $257,875,932 $95,122, Crookston 665,410 $103,457,191 $33,286, Grand Totals 27,442,878 $8,115,852,590 $2,768,336, Excludes 1.9 Million GSF for Rochester Campus, Field Stations, and Research and Outreach Centers. Does not include parking ramp decks. 11

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14 Actual Investment vs. Target $300 Accumulated deferral to lower target since 2002: $306 Million $ in Millions $250 $200 $150 $100 Upper Target Lower Target Decreasing Backlog Sustaining Backlog Increasing Backlog $50 $

100 90 80 70 HEAPR Appropriation History (System-wide) $ Millions 60 50 40 30 20 10 0 2000-2001

15 HEAPR Appropriation History (System-wide) $ Millions Request Appropriation Emergency Appropriation 15

16 Capital Need Exceeds Available Funding (System-wide) Required Capital to Maintain current FCNI Ratio: $160 Million per year Actual Funding (annual average during last 5 years): $110 Million per year R & R $11,655,600 11% Auxiliary Funds $13,359,200 12% Facility Renewal $25,194,400 23% Utilities Infrastructure $9,509,800 9% Value of Razed Facilities $12,004,600 11% HEAPR $37,600,000 34% Average Annual Renewal Investment: FY 09-13: $110M 16

17 Investment in Existing Space vs. New Space (Twin Cities State Supported Space) New Construction 47% Renewal 53% Capital Investments FY02-FY12 17

18 Renewal Backlog vs. Peers (Twin Cities State Supported Space) 18

19 Renewal Spending vs. Peers (Twin Cities State Supported Space) $9.00 Peers $9.00 U of M $8.00 $7.00 $8.00 $7.00 $1/gsf less than peers $6.00 $6.00 $5.00 $5.00 $4.00 $4.00 $3.00 $3.00 $2.00 $2.00 $1.00 $1.00 $0.00 $0.00 Peer Avg. (FY02-FY12) U of MN Avg. (FY02-FY12) Peer Avg. (FY06-FY12) U of MN Avg. (FY06-FY12) 19

20 Facility Condition Strategies Utilize existing space Renovate existing space Maximize energy conservation and implement district utility strategies Target individual system improvements Demolish or decommission targeted buildings Build new facilities Renovated 11 Vital Buildings 1,192,501 GSF Retired $200M+ of renewal work Razed 23 Obsolete Buildings 533,352 GSF Avoided $31M renewal; $1.25M annual O&M Twin Cities State Supported Space 20

21 Draft Investment Model Criteria Range Criteria Condition (FCNI) Renovation Cost ($ per GSF) Operations & Maint. Costs Energy Demand (kbtu) Space Efficiency Historical Value (NHRP Status) Code and Accessibility Deficiencies Master Plan Fit Program Flexibility of Functionality Space High / Poor Critical (>1.00) >$200 >110% >110% Worst None 0-Serious Identified for Disposal Poor Poor Poor ( ) $125-$199 1-Major Disposal advances plan Mid Fair ( ) $75-$124 95% to 110% 95% to 110% Steward 2-Moderate Not Addressed Reasonable Reasonable Good ( ) $25-$74 3-Minor Preservation advances Plan Low / Good Excellent ( ) <$25 <95% <95% Best Listed or Eligible 4-Not Significant Identified for preservation Excellent Excellent Weight TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD 21

22 Target FCNI Draft Building Portfolios Title Description Default Buildings Range TBD Keep Up Little to no deferred maintenance or need for space/system renewal or modernization. Maintain all components and replace at end of useful life. Our best buildings, typically new, FCNI generally < Range TBD Catch Up and Keep Up Maintenance has been deferred, but space/systems not yet in need of renewal. Retire deferred maintenance on a system-by-system basis. Functional buildings; FCNI generally between Range TBD Keep & Renew Significant maintenance has been deferred; space/systems need extensive renewal to serve programs. Maintain bldg components to extent possible, retire deferred maintenance when feasible, and invest in renewal when economically justifiable. Compromised buildings; FCNI generally > 0.41 NA Defer and Do Not Reinvest Not suitable for significant investment. Ability to serve program is compromised in long run, yet suitable for near term. On disposal cycle with undetermined date. Greatly compromised or non-strategic support buildings NA Secure and Protect Significant maint. Has been deferred, and space/systems need significant renewal. No longer capable of supporting program, yet carries significance worth protecting against the time renewal and modernization become possible. Eddy Hall NA Dispose or Replace Qualitative considerations outweigh practicality of further investment. Prepare to remove (and potentially replace) asset within 5 years, or at minimum identify funds to begin the process. Highly compromised buildings generally at or near end of life; FCNI ~

23 Summary Facility needs present a significant challenge Funding support is critical to maintain a safe, functional campus and uphold competitive position amongst peers Optimal utilization of existing space is paramount to the success of our mission Updating assessments and pursuing a strategic multi-year investment approach ensures inclusiveness and balance 23

24 Policy Questions for the Board What percent of University resources should be allocated to facilities? What is an appropriate [minimum] condition standard for individual buildings, or portfolios of buildings (age, type, programs served, etc)? What is the best approach to stop adding to the backlog (e.g. maintenance endowments for new buildings)? 24

25 Questions 25

Addressing Deferred Maintenance with Advanced Facility Condition Assessments at the University of Arizona

Addressing Deferred Maintenance with Advanced Facility Condition Assessments at the University of Arizona Christopher M. Kopach, AVP, The University of Arizona; APPA President Phillip Saieg, Regional Technical