Sector Focus Bulletin

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Watts Sector Focus Bulletin - Higher Education

The latest figures from UCAS reveal a 3.5% increase in university applications for the 2013 academic year when compared to the previous 12 months. However, despite these encouraging statistics, the UK higher education sector still has some way to go to regain the pre-recession peak of 2007, when university applications were at an all-time high.

With annual tuition fees of £9,000-plus per annum now the norm, the challenge for the sector is to deliver value for money. Universities must prove that the pairing of a degree that employers respect, together with the student experience they offer, is worth the considerable cost to undergraduates and their families. Despite rising fees, higher education remains under considerable funding pressure. To maximise the value derived from capital budgets, universities must find ways to use their assets to best advantage. Against this background, the key challenges for estates directors are to:

  • Create a sense of place for stakeholders and deliver high quality, inspirational learning and living space;
  • Develop flexible, multi-disciplinary facilities that enable greater space utilisation while providing opportunities for a range of uses to generate additional income;
  • Provide facilities that support new technology and an increasingly wide range of teaching and research methods; and
  • Develop sustainable premises that are able to deliver significant reductions in carbon emissions.

The key to success in the current political and economic climate is for universities to become more efficient with the resources they have, developing strategies that promote innovation and flexibility while enabling estates directors to maximise the opportunities provided by the building stock they own and manage.

In this special edition of the Watts Bulletin we look at some of the issues now impacting the HEI market. We hope you will find the content both interesting and informative.

Cullum Alexander, Director, Watts Group PLC

Watts Sector Focus Bulletin - Higher Education

English universities receive £1billion funding boost

Universities in England have been given a capital funding boost that could be worth £1billion for university projects – on condition that government backing can be matched by investment from the private sector or charities.

HE Focus Main Feb-13

Chancellor George Osborne has pledged £200million of new money to the UK Research Partnership Investment Fund (UK RPIF) which supports long-term university capital projects.  However, to access the money, universities must match the funding by at least double from private companies or charities – taking the total investment, including universities’ own contributions, to at least £1billion.

The fund, which was launched with a start-up government investment of £100million immediately following the 2012 Budget, was heavily oversubscribed. Now, as well as supporting the best proposals already submitted by universities, the fund will reopen for further bids. The fund is managed by the Higher Education Funding Council for England (HEFCE) and universities can bid for between £10million and £35million per project. Applications are judged on value for money and must build on existing strong research capability.

Successful projects from the first round of bidding for the fund include:

  • A £60million partnership between the University of Birmingham and Rolls-Royce for a world-leading research centre for high temperature metallurgy and associated processes for components including turbine blades;
  • A £32million partnership between the University of Oxford and an industry consortium for a new centre for drug target discovery and for research based on medical data sets;
  • A £92million partnership between the University of Warwick, Jaguar Land Rover (JLR) and Tata Motors European Technical Centre (TMETC) for a new National Automotive Innovation Campus; and
  • A £35million-plus partnership between the University of Surrey and an industry consortium including many of the mobile communications global industry leaders to build a new collaborative international research centre which will support the development of fifth generation cellular communications.

The aim is for this additional funding to provide a further incentive for university-business collaboration that will lead to research findings and medical breakthroughs with a commercial aspect. Business sectors that are involved in bids include aerospace, automotive, consumer goods, healthcare, mobile telecoms, IT and energy generation. Charities involved include medical, health and hospital charities.

An independent evaluation of previous government investment in research capital has shown how successful this type of funding can be in accelerating private sector investment in UK university research infrastructure. For example, a £4.3million investment at Loughborough University led to a £60million investment by BAE Systems and at Dundee University. Meanwhile, an £8million investment attracted £23m from AstraZeneca, Boehringer Ingelheim, GSK, Merck and Pfizer.

The full details of the UK RPIF fund can be found on the HEFCE website.

For more information about the higher education sector, contact Daniel Webb, Lead Director at Watts Group PLC, on 020 7280 8078.

Do you welcome this scheme or do you think universities should think twice before teaming up with commercial organisations? Let us know your views on Watts’ Twitter page @Watts_Group or become a member of the Watts Bulletin group on LinkedIn.

The Watts Bulletin is the technical companion to the Watts Pocket Handbook, the essential guide to property and construction, as used by professionals since 1983.

Watts Bulletin editor: Trevor Rushton.