Sightlines LLC FY10 Facilities MB&A Presentation New Mexico State University Date: Presented by: Peter Reeves, and James Russell University of Illinois at Urbana Champaign The University of Maine University of Maine at Augusta University of Maine at Farmington University of Maine at Machias University of Maine at Presque Isle University of Maine at Fort Kent University of Maryland University of Massachusetts Amherst University of Massachusetts Boston University of Massachusetts Dartmouth University of Massachusetts Lowell University of Michigan University of Minnesota University of Missouri University of Missouri - Kansas City University of Missouri - St. Louis University of New Hampshire University of New Haven University of Notre Dame University of Oregon University of Pennsylvania University of Portland University of Redlands The University of Rhode Island, Narragansett Bay The University of Rhode Island, Feinstein Providence The University of Rhode Island, Kingston University of Rochester University of San Diego University of San Francisco University of St. Thomas (TX) University of Southern Maine University of Toledo University of Vermont Upper Iowa University Utica College Vassar College Virginia Commonwealth University Virginia Department of General Services Wagner College Wellesley College Wesleyan University West Chester University of Pennsylvania West Virginia University Western Oregon University 1
Sightlines profile Common vocabulary, consistent methodology, credibility through benchmarking Update Map State Systems Flagship Institutions 2
Groups for Comparisons Composite Peer Institutions George Mason University The University of Alabama - Tuscaloosa The University of Maine University of Massachusetts - Amherst University of New Hampshire University of Rhode Island Virginia Commonwealth University I & G Peer Institutions Iowa State University Kansas State University Oregon State University Southern Methodist University Dallas Texas A&M University The University of Oklahoma Trinity University University of Central Arkansas University of Colorado Boulder University of Missouri Columbia Housing Peer Institutions Clemson University - Housing Dartmouth College Residential Life George Mason University - Housing The University of Alabama Tuscaloosa - Housing University of Massachusetts Amherst - Housing University of Rhode Island - Housing Virginia Commonwealth University Residential Life 3
A vocabulary for measurement The Return on Physical Assets ROPA SM The annual investment needed to insure buildings will properly perform and reach their useful life Keep-Up Costs The accumulated backlog of repair and modernization needs and the definition of resource capacity to correct them. Catch-Up Costs The effectiveness of the facilities operating budget, staffing, supervision, and energy management The measure of service process, the maintenance quality of space and systems, and the customers opinion of service delivery Annual Stewardship Asset Reinvestment Operations Effectiveness Service Asset Value Change Operations Success 4
Core considerations Composite Campus More campus users than peer institutions Investing less capital into existing space than peers Limited operational resources; campus inspection impacted I&G Campus Investment focus over the last 6 years has been on investments into existing space Stewardship investments(brr) have been strong and limited the growth of the backlog Despite these investment levels, the backlog of need remains high Housing Campus The number of small housing facilities challenges both capital investment and operations for the housing group Recently, investments have focused on new construction Housing reserve levels in recent years are close to the targets set by Sightlines 5
Space Profile 6
NMSU has similar technical complexity to peers 3.5 3 2.5 2 1.5 1 0.5 Tech Rating 0 I & G NMSU Housing Peer Average 7
NMSU is more crowded than peer institutions Need to figure out whats going on with A, I would imagine that is not correct 450 400 350 300 250 200 150 100 50 0 Density Factor I & G NMSU Housing Peer Average 8
NMSU has many more smaller facilities Unique housing types impact building intensity Building Intensity 350 Buildings / 1,000,000 GSF 300 250 200 150 100 50 0 I & G Housing NMSU Peer Average 9
NMSU has renovated 25% of campus 254 Buildings 4,524,341 GSF; Composite Campus 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 2010 Construction Age vs. Renovation Age 0% Less than 10 10 to 25 25 to 50 Over 50 Major Renovations Include: O Donnell Hall (2008) Foster Hall (2008) Wind Tunnel/Research (2006) Dove Hall (2003) Construction Age Renovation Age Sightlines defines a life cycle renovation as a one time investment into a building of over 50% of the buildings replacement value. 10
Similar age profile between I&G and Housing 254 Buildings 4,524,341 GSF; Composite Campus 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 2010 Renovation Age versus peers Less than 10 10 to 25 25 to 50 Over 50 Housing Renovation Age I & G Renovation Age 47% of space is over 25 years old(housing) 52% of Space is over 25 years old(i&g) 11
Campus Age Distribution Campus profile is older than the peer average 45% Total Campus Age Breakdown % of Campus 40% 35% 30% 25% 20% 15% 10% 5% 0% Under 10 10 to 25 25 to 50 Over 50 NMSU Renovation Age Peer Renovation Age Percent of GSF 70% 60% 50% 40% 30% 20% 10% 0% Space over 25 years old (Renovation Age) I & G Housing NMSU Peer Average 12
Capital Investment Profile 13
55% of investments have gone toward existing space $45.0 NMSU (Composite) Capital Investment $40.0 $35.0 $ (in Millions) $30.0 $25.0 $20.0 $15.0 $10.0 $5.0 $- FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 Existing Space New Construction Average(w/New space): $23.8M Average(w/o New Space): $13.0M 14
Housing investment focus on new space Total Project Spending $30.00 I & G Housing $25.00 $20.00 Millions $15.00 $10.00 $5.00 $- FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 Existing Space New Space Average(with New Space): $16.4M Average(without New Space) $12.0M Average (with New Space): $7.4M Average(without New Space): $1.1M 15
Overall Investments are below peers Stewardship spending has increased annually since FY05 $6.00 Peer Average Total Project Spending NMSU $5.00 $4.00 $/GSF $3.00 $2.00 $1.00 $- FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 Annual Stewardship Peers Total Investment Average: $1.07/GSF Peers Stewardship Average: $4.09/GSF Asset Reinvestment NMSU s Total Investment Average: $1.32/GSF NMSU s Stewardship Average: $2.90/GSF 16
Defining the annual investment need $/GSF $60 $55 $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 Age Category < 10 Years Age Category 10-25 Years Age Category Over 25 Years 12% 36% 52% 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 Annual Life Cycle Cash Flow Building Age Amortization of Life Cycle Expenses 17 17
Defining Annual Stewardship Targets Total Campus Setting goals to arrest the rate of asset deterioration $35 FY2010 Total Campus Stewardship Targets FY10 Replacement Value: $997M $ in Millions $30 $25 $20 $15 $10 $29.9 $14.5 Target Need: Life Cycle is discounted for the coordination of modernization and renovation assessment $6.2 $5 $11.7 $8.8 $- 3% Replacement Value Life Cycle Need Functional Obsolescence (Equilibrium) (Target) Envelope/Mechanical Space/Program Industry Standard Sightlines Recommendation 18 18
Stewardship investments have kept pace with target $16 $14 $12 $6.6M $6.6M $ in Millions $10 $8 $6 $7.0M $8.3M $7.7M $7.1M $4 $2 $- 2005 2006 2007 2008 2009 2010 Envelope/Mechanical Space/Programming Approximately $43M has been deferred since FY05 Target Investment 19
Annual Stewardship needs for I&G and Housing $25 FY2010 Stewardship Targets $20 $ in Millions $15 $10 $11.4 $4.0 $5 $0 $8.9 $3.1 $6.7 $1.6 $2.8 $2.1 Total Need Target Need Total Need Target Need $20.3 M $10.7 M $5.9 M $3.7 M I & G Housing Envelope/ Mechanical Need Space/Program Need 20
BRR investments have limited the stewardship shortfall Growth in stewardship investment has been able to match increase in target $12 $10 $3.0M $8 $4.0M $4.0M $ in Millions $6 $6.0M $5.2M $4.4M $4 $2 $- 2005 2006 2007 2008 2009 2010 Envelope/Mechanical Space/Programming Approximately $27M has been deferred since FY05 Target Investment 21
Housing investments are short of target $4 $4 $3 $ in Millions $3 $2 $2 $0.4M $2.6M $2.8M $2.5M $2.0M $3.0M $1 $1 $- 2005 2006 2007 2008 2009 2010 Envelope/Mechanical Space/Programming Target Investment 22
Closer to target when account for housing reserves $4 $4 $3 $828K $ in Millions $3 $2 $2 $0.4M $2.6M $2.6M $2.5M $1.7M $1 $1 $- 2005 2006 2007 2008 2009 2010 Envelope/Mechanical Target Investment Space/Programming Reserving Amount 23
Stewardship Investments are highest in peers group Expansion of BRR drives the total stewardship investment annually 80 Total Annual Stewardship by Campus Type 70 60 50 % of Target 40 30 20 10 0 I & G NMSU Housing Peer Average 24
Overall, NMSU is addressing capital needs on campus $26 Total Campus $24 $22 $20 Increasing Net Asset Value $ in Millions $18 $16 $14 $12 $10 $8 $6 $4 $2 $- Sustaining Net Asset Value Decreasing Net Asset Value 2005 2006 2007 2008 2009 2010 Annual Stewardship Asset Reinvestment 25
I&G investments have been addressing the backlog $26 I & G Campus $24 $22 $20 Increasing Net Asset Value $ in Millions $18 $16 $14 $12 $10 $8 $6 $4 $2 $- Sustaining Net Asset Value Decreasing Net Asset Value 2005 2006 2007 2008 2009 2010 Annual Stewardship Asset Reinvestment 26
Housing investments rely largely on R&R funds Falling short of target $8 Housing Campus $6 Increasing Net Asset Value $ in Millions $4 Sustaining Net Asset Value Decreasing Net Asset Value $2 $- 2005 2006 2007 2008 2009 2010 Annual Stewardship Asset Reinvestment 27
I&G backlog higher than peers; while housing is below $/ GSF 100 90 80 70 60 50 40 30 20 10 0 Total Asset Reinvestment Backlog ($/GSF) I & G Housing NMSU Peer Average 28
Operations Profile 29
Facilities Operating Budget The total budget has decreased annually since FY08; PM and DS fall below peers 30
Daily Service Budgets significantly below peers Averaging $2.14/GSF less than peers, which equals approximately $9.5 M less annually. 31
NMSU is among the lowest in the sightlines database Consistent between I&G and Housing budgets Daily Service Budget ($/GSF) 4.5 Daily Service Budget Peers 4 3.5 3 $/ GSF 2.5 2 1.5 NMSU- Composite 1 0.5 0 I & G Housing Possible Drivers: Focus on reimbursable work Lower regional cost NMSU Peer Average 32
Building Intensity and Backlog challenge Maintenance 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 General Repair Inspection Scores NMSU Composite NMSU I&G Peers NMSU Housing 33
Custodial Performance Higher levels of density impact coverage and cleanliness inspection levels Custodial Coverage NMSU Housing I&G Peers NMSU I&G 5 4 3 2 1 Housing Peers 0 Cleanliness Inspection Scores NMSU Composite Peers NMSU I&G NMSU Housing -1 SD +1 SD 34
Grounds Performance Grounds intensity impacts staffing levels 45 Correlation: Grounds Intensity & Grounds Acres/FTE 4 Grounds Inspection Scores Acres/FTE 40 35 30 25 20 15 10 5 0 Peers NMSU 3 2 1 0 NMSU Composite Peers NMSU I&G NMSU Housing 0 0.125 0.25 0.375 0.5 0.625 0.75 0.875 1 1.125 1.25 1.375 1.5 1.625 1.75 Grounds Intensity 1.875 2 2.125 2.25 2.375 2.5 2.625 2.75 2.875 3 35
Energy Consumption is below peers 36
Utility Cost by Fuel NMSU has seen electric costs drop by 28% since FY08 $30 Utility Unit Cost By Fuel Type $25 $20 $/MMBTU $15 $10 $5 $- FY05 FY06 FY07 FY08 FY09 FY10 37
Concluding comments FY2010 Summary Campus profile: As campus populations continues to grow, demands on facilities will increase as well. I&G Capital While investment has been high, there remains a substantial backlog of needs. Target future large investments in the highest need spaces, while keeping up with those buildings in good condition. Housing Capital With the new space that has been built, continuing to maintain and grow the amount added to the reserves each year will help address future capital needs At the same time, one-time investments will be needed for some of the older space on campus Lean Operations; Challenged performance NMSU s operating costs are one of the lowest in the Sightlines database. The strain is evident in the lower campus scores Without adding additional resources, it will be difficult to improve the overall campus inspections scores and service levels 38
Questions and Comments 39