- Introduction
On December 3, 1998, the Oakland University Board of Trustees directed the president to review the concept of a multi-purpose complex on the campus of Oakland University (OU) that might consist of a performing arts center, a conference center and hotel, and an ice arena. The Board action, included as Attachment 1, indicated that the review should include a process of broad-based consultation with campus constituencies, including the University Senate and the Student Congress. On January 5, 1999, President Russi formed and charged the Multi-Purpose Complex Review Committee (MPCRC) with the following:
- Review the feasibility of developing a multi-purpose complex on campus
- Review financing options and opportunities to partner with one or more public/private entities
- Consult extensively with campus constituencies to determine the campus perspective on these potential projects. (Please see Attachment 2 for the committee formation notice.)
The Committee, whose membership is listed as Attachment 3, met weekly beginning on January 29, 1999. The Committee identified 22 campus groups to be consulted about the concept of a multi-purpose complex as part of its charge. In order to effectively meet with this number of groups within a six week period, the Committee decided to divide itself into four sub-groups that would report back on their consultations at each weekly Committee meeting. A list of the groups that were engaged in this campus-wide consultation process, along with dates, times and locations, is included as Attachment 4 to this report.
As a result of its consultations with campus groups and its own deliberations, the Multi-Purpose Complex Review Committee found there was general agreement on certain principles that can help to guide the University's decision-making regarding the types of University/private sector partnerships being considered in this complex. A set of Guiding Principles is offered below for use in assessing and determining whether to continue to move forward with such partnerships.
The Committee has subsequently attempted to apply these principles to the multi-purpose complex concept and its individual components, and has developed a set of recommendations that are included in the report.
II. Guiding Principles
The following principles were developed based on input from the campus community and through the deliberations of the MPCRC. They are intended to provide a framework for evaluating public-private partnership opportunities to be incorporated into a multi-purpose complex. As we move forward with such possibilities, we believe they should be continually analyzed within the context of these principles.
- This development should support the academic mission and programs of the University.
- The University should receive a reasonable financial return on use of its land.
- Any development should tie directly to the University's mission, vision and strategic goals.
- Funds generated for the University through such public/private partnerships should be allocated to help meet the University's strategic goals, particularly in support of academic programs.
- The University should structure any agreements with private partners to minimize its financial risk and limit its exposure to significant financial losses. Private partners should have proven expertise in building and operating similar facilities, and should provide convincing evidence of long-term financial strength and viability.
- The University should not expect to use its own resources, other than land, or personnel to construct or operate a multi-purpose complex on campus.
- The University should have a meaningful oversight role in the management and operation of such a complex.
Recommendations
Based on campus-wide input, as well as our own deliberations, the Multi-Purpose Complex Review Committee recommends that the University move forward to further develop the concept of a multi-purpose complex on campus.
It is further recommended that individual components of such a complex be determined consistent with the guiding principles outlined above. The committee did a preliminary analysis of how the three proposed components, performing arts center, conference center/hotel, and ice arena fit with the guiding principles and offers the following observations:
- A performing arts center fits within the guiding principles. There is a direct connection with the academic mission, as well as the University's heritage as a cultural resource in the community for outreach purposes. Negotiations regarding specific proposals would need to focus on financial return, long-term viability, and details regarding University oversight, marketing and advertising.
- A conference center and hotel are consistent with the guiding principles. The connections to the University's academic programs, mission and strategic plan include the ability to offer executive and continuing education and training, and to hold academic conferences to enhance OU's image.
- An ice arena does not meet all of the guiding principles. The cost of an ice arena and intercollegiate hockey will have a negative impact on the University's academic mission and programs.
- Questions and Concerns
During campus-wide consultation and committee deliberations, many questions and concerns were raised that could not be answered by the committee within the timeframe available or with the information currently in hand. The following are some proposed steps that could facilitate addressing those questions and concerns.
- Conduct a facilities needs analysis for the academic programs in the Department of Music, Theatre and Dance, particularly for performance spaces.
- Perform market analyses to determine financial and operational potential for the individual components of the proposed complex.
- Determine the financial parameters for the development and its individual components.
- Identify and evaluate similar activities at other universities around the country in order to determine the best practices that may apply to a project here.
- Identify and evaluate similar developments being planned or discussed in the region (i.e., Troy multi-purpose center, conference centers/hotels, etc.), to determine their impact on OU's future plans.
- Continue campus-wide consultation as the University moves forward.
Multi-Purpose Complex
Description
University/private sector partnerships are common in today's world. The ability to leverage opportunities and resources can advance the academic mission and can prove to be beneficial for institutions and businesses alike. Recognizing the economic climate in Oakland County, and the importance of recent inquiries from the private sector, there is potential for the creation of such a partnership(s) at Oakland University.
The concept of a multi-purpose complex that is being considered is to locate some major developments on a single site on campus, in order to maximize return from land use and create efficiencies where possible. Some of the benefits or efficiencies that might be achieved by combining a number of major developments on a single site on campus include the following:
Crossover Audiences
Greater Image-Building
Shared Infrastructure - Parking, Utilities, Traffic Management
Shared Costs - Ticket Sales, Marketing, Facilities Maintenance and Operations,
Shared Overhead on Profit Centers - Concessions, Novelties
Campus groups are generally favorable to the concept of a multi-purpose complex, although there was considerable debate over the merits of the individual components now being proposed. There were three levels of benefits expressed, individual, academic departments, and university-wide benefits.
A few individuals felt that the University should identify the "highest and best" use for our property in order to maximize the financial return regardless of connection to mission.
Benefits to OU
- Such a complex would draw many more people to campus who would not normally come here.
- This could be an opportunity to "pass costs on" to outside parties in order to gain benefits for OU.
- A long-term financial return to the University could be used to maintain and enhance University programs and facilities.
Concerns
- There is a concern about rushing to make a decision on whether to proceed with this complex. Long-term planning is needed to determine what the other needs for OU might be in the future. Some individuals questioned why we are considering this development prior to the completion of a new campus master plan.
- There is a concern that the market is already saturated with entertainment, sports, and conference center venues, and that there wouldn't be sufficient business for OU to profit financially.
- Concern was expressed about OU's ability to maintain long-term control over the University's land resources, and to maintain the connection of these developments to the University mission and academic programs.
- OU needs to protect itself from the potential of financial distress or ruin on the part of private partners.
- Questions were raised about the source of funding for this venture. There was a general sense that University funds should not be used.
- A concern was expressed that, even if not funded or staffed by the University, such a complex would represent a burden on the University's administrative and support personnel.
- There was a concern raised about alcohol consumption in these venues, and the University's liability and ability to control.
- Some questioned whether this type of development would turn us into more of a sports and entertainment complex rather than a higher education institution.
The University should have design sign-off in order to assure aesthetics appropriate to the University.- Performing Arts Center
Description
Oakland University has a long and rich history as a major cultural center in Oakland County. As recommended in the University's strategic planning and "Creating the Future" processes, a performing arts center could build upon that history, and could enhance the University's visibility and image in the region. A proposal received from a private developer described their idea for this facility as a 5,000 seat, $50 million top quality performing arts theater that would attract such things as major Broadway shows, concerts, and other specialty shows.
Campus consultation indicates that most members of the community believe a performing arts center would be consistent with the University's mission, image, history and vision for itself.
The Department of Music, Theatre and Dance (MTD) focused their remarks on the need for more and better facilities for their academic programs, and indicated they would not be able to make significant use of a 5,000 seat theatre for department performances. Students feel like an afterthought and don't believe the University should be looking at creating this type of facility before it addresses the inadequacies of MTD facilities. The need for a smaller theatre venue for MTD students, preferably located near Varner Hall was expressed by many students, faculty and staff.
Benefits to OU
- The presence of a major top quality performing arts theater on campus will enhance Oakland's reputation as a cultural center in the region, which might have spin-off benefits for the Department of Music, Theatre and Dance, the Meadow Brook Theatre and other performing arts venues on campus, including the possibility for joint marketing.
- With a very clear and visible connection to Oakland University, this center could greatly enhance OU's image and visibility in the region and in the country (i.e., The __ ?__ Performing Arts Center at Oakland University)
- There may be internship opportunities for a limited number of OU students at such a center. There would also be employment opportunities for the general student population.
- There could be opportunities for Master Classes presented by touring professionals.
- Faculty, staff and students will have ready access to many different types of performances, which can enhance student life and connection to the University.
- The University could be expected to receive a reasonable financial return for this use of its land assets.
Concerns
- There should be some mechanism for controlling what events can be held. Veto power was suggested, as well as well-defined parameters.
- There is a concern about the impact of this center on the continued viability of Meadow Brook Theatre.
Conference Center/Hotel
Description
This idea has been under discussion at Oakland University for many years, particularly in response to the expansion of the business community surrounding campus and as an opportunity to host academic conferences. It is currently envisioned as a top quality academic, executive, and corporate conference center designed to serve the needs of regional businesses, governmental units and the University. The size is uncertain and would likely flow from market and financial analysis yet to be undertaken. The many cultural and recreational attractions on campus lend further appeal to this type of project.
Feedback from experts in these types of developments leads us to conclude that the financial viability of a conference center depends on also having a hotel connected to it. Also, there is a general rule of thumb that there should be about 100 square feet of conference room space for each hotel room. There are many different types and levels of conference centers, including executive, corporate, continuing education, and convention type centers. The University needs to further refine its goals and market in order to determine the most appropriate type of conference center, but in any case it should be designed consistent with academic conference needs. Any center on campus would be expected to have "state-of-the-art" instructional technology and telecommunications equipment. Many individuals suggested that we examine the Eastern Michigan University conference center and hotel experience.
Benefits to OU
- The ability to hold academic conferences at OU could greatly enhance our visibility and image on a national basis.
- The potential, given OU's location, to establish corporate partnerships offers a big advantage in terms of financial viability for a conference center, ready audiences for continuing education activities, and the ability to extend these partnerships to other activities.
- This type of facility might be used to attract executive health assessments and wellness training programs.
- Several faculty members asked that we explore the possibility of incorporating a faculty club into this facility
Concerns
- There was great concern across campus that the University community should receive preference in both rates and access for use of the conference center and hotel.
- Ice Arena
Description
This concept has also been under discussion for some time at the University. An ice arena that would serve the community as well as an intercollegiate hockey program at the University, and that could be used as dry floor exhibit space when not in use for those purposes could draw people to the University. In order to serve as a viable facility for intercollegiate hockey, a main arena with 5,000 to 7,000 seats would likely be required.
On the whole, there was little interest expressed in the ice arena component across campus. There was general opposition to allocating additional University resources to this type of facility or to intercollegiate hockey.
Benefits to OU
- There were a small number of persons on campus who felt that intercollegiate hockey could put OU on the map almost immediately, if we are able to play in the CCHA against teams such as UM, MSU, Notre Dame, etc.
- If we are going to play intercollegiate hockey, we will need to have a top notch on- campus facility in order to attract the quality of athletes we would want, given the competition for such individuals in this region.
- Recreational hockey and figure skating are very popular in the region, with existing ice facilities able to rent ice time 24 hours per day. This might be another opportunity for OU to attract persons to campus who might not otherwise come.
- An ice arena, if planned for, can also be used as an exhibit hall, a convocation hall, or for other functions.
Concerns
- Concerns were expressed about the fact that we are in the middle of our transition to Division I intercollegiate athletics, a major move for the University in terms of time, effort and resources. Many are reluctant to support adding another Division I sport until we have completed this transition and can assess the relative benefits and costs of this move.
- There is a concern that hockey is really only popular in this region and moving into this sport would not create national visibility.