Learn how national data trends show campus buildings are aging and campus backlogs are growing. And, that these trends will accelerate over the next ten years as building constructed in the 1960's turn 50 years old and capital funding from all sources continue to be limited. Furthermore, learn how the partnership between Sightlines, LLC and University of Massachusetts - Amherst that began in 2005 resulted in more refined documented building conditions, creation of portfolios of projects, and engaged campus leadership in a priority setting process to reach consensus on a multi-year capital plan through the Integrated Facilities Planning process.

1. 1
New Strategies for Attacking Deferred Maintenance
Presenters:
Jim Kadamus, Vice President, Sightlines
Juanita Holler, Associate Vice Chancellor of Facilities & Campus Services, University of Massachusetts ‐
Amherst
December 5, 2012

2. 2
A Few Housekeeping Items
Enter questions here at any
point during the webinar
Please call us at (215) 983‐7125 with
technical questions – audio, video, etc.

3. 3
Today’s Agenda
Trends in Higher Education and What They Mean for
You – Jim Kadamus
Five Easy Steps to Reduce Facilities Risk – Jim Kadamus
UMass Amherst Experience – Juanita Holler

4. 4
Trends in Higher Education Facilities and What They
Mean for You

5. 5
Sightlines National Database
345 campuses in 42 States – evenly split public and private
• Annually tracking $5.9 billion in operations
budgets and $9.0 billion in capital projects
• Database of 345 campuses, 25,000 buildings
and 1 billion GSF

6. 6
#1 Campuses are getting older
More high risk space on campus
(%) Square Footage over 25 years old
(Renovation Age)
19% 19% 20% 21% 22% 23%
41% 40% 39% 39% 38% 36%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2007 2008 2009 2010 2011 2012
% of Space 25 to 50 % of Space Over 50
Overall Database

7. 7
#2 Capital investment moves up and down in cycles over time
Recurring capital remains steady; 2012 totals are equal to 2007 levels
$6
$5
$4
$3
$2
$1
$0
Capital Investment in Existing Space ‐ $/GSF
2005 2006 2007 2008 2009 2010 2011 2012
Annual Capital One‐time Capital
Overall Database

8. 8
#3 Capital investment mix changed modestly since 2005
Proportionately less investment in space as overall capital funding grows
Overall Database
14%
Total Project Spending Mix
28%
FY2005
14%
35%
9%
17%
29%
FY2012
17%
30%
7%
Building Envelope Building Systems Infrastructure
Space Renewal Safety/Code

9. 9
#4 “Backlog of needs” are increasing
Backlogs up about $11/GSF over last six years
Total Backlog $/GSF
$100
$90
$80
$70
$60
$50
$40
$30
$20
$10
$0
2007 2008 2009 2010 2011 2012
Overall Database

10. 10
#5 Facilities operating budgets flat since 2008
Operating budgets are flat; 2012 budgets are equivalent to 2007 levels
Overall Database
Daily Service Budget

11. 11
Conclusions
• More buildings are crossing over into higher risk age profile and will increase
campus backlog unless addressed
• Shrinking capital and operating budgets and increasing debt will make setting
clear priorities for capital renewal critical
• Renovate or demolish decisions will become more common in next decade,
especially for the +50 buildings
• Cuts in operating budgets will force campuses to find new ways to deploy staff
without reducing levels of service and quality of campus appearance
• Campuses need data‐driven strategies for documenting backlog of need,
creating portfolios for investments and identifying highest priority projects

12. 12
Five Easy Steps CFOs Can Take to Reduce Facilities
Risk Exposure

13. 13
Five steps to reduce facilities risk exposure
1. Understand your campus age profile.
2. Understand the cost of keeping‐up (Annual Stewardship) and how much cost
you are deferring into the future.
3. Understand your capital project mix – is it diverse and hitting all aspects of
campus need?
4. Understand work order hot spots – this information can tell you where the
greatest risks are on campus.
5. Understand energy consumption and costs to identify opportunities for
savings.

14. 14
#1 Understand Age Profile of Campus – Past, Present and Future
Younger buildings have moved into older age categories since FY01
Shift in Campus
Renovated Age Profile
47% 40%
29%
14%
22% 40%
53%
56%
15%
12% 10%
19%
16%
8% 8% 11%
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
FY01 FY06 FY11 FY16
Under 10 Years 10 to 25 Years 25 to 50 Years Over 50 Years

15. 15
Old age results in higher risk
Campus has more space that falls into the higher risk categories than peers
Buildings over 50
Life cycles of major building components are past due. Failures
are possible.
Highest risk
Buildings 25 to 50
Life Cycles are coming due in envelope and mechanical
systems.
Higher Risk
Buildings 10 to 25
Lower cost space renewal updates.
Medium Risk
Buildings Under 10
Little work .“Honeymoon” period.
Low Risk
Highest Risk
Highest Risk
Highest Risk
Higher Risk Higher Risk Higher Risk
Medium Risk Medium Risk Medium Risk
Low Risk Low Risk Low Risk
My Campus

16. 16
#2 Defining Stewardship Investment Targets
Setting a yearly goal to arrest the rate of facility depreciation
$31.1
FY2011 Stewardship Targets
$15.2
Replacement Value: $1.04 B
$7.6
$11.6 $8.7
$35.00
$30.00
$25.00
$20.00
$15.00
$10.00
$5.00
$0.00
3% Replacement Value Life Cycle Need
(Equilibrium)
Functional Obsolescence
(Target)
$ in Millions
Envelope/Mechanical Space/Program
Straight Line Deprecation Sightlines Recommendation
Total $ in Millions $31.1 $26.8 $16.3
% of Replacement 3% 2.59% 1.57%

17. 17
Understand Rates of Deferrals
$18.0
$16.0
$14.0
$12.0
$10.0
$8.0
$6.0
$4.0
$2.0
$0.0
$9.5 Million
FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11
$ in Millions
Stewardship Spending Mix
Envelope/Mechanical Space/Programming
$80.0
$70.0
$60.0
$50.0
$40.0
$30.0
$20.0
$10.0
$‐
$21.7 Million
11 Year Target Total Actual 11 Year Investment
$ in Millions
Envelope/Mechanical
Target vs. Actuals
$80.0
$70.0
$60.0
$50.0
$40.0
$30.0
$20.0
$10.0
$‐
11 Year Target Total Actual 11 Year Investment
$ in Millions
Space/Programming
Target vs. Actuals
$24.8 Million
$8.5 Million
$7.7 Million
$5.8 Million

18. 18
% of Total Replacement Value Annual Stewardship Compared to Depreciation
Annual Stewardship not keeping up with rate of depreciation expense
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
Annual Stewardship Spending vs. Depreciation Expense
FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011
FMB&A: Equilibrium Need FS: Depreciation Expense FMB&A: Stewardship Actual Investement

19. 19
#3 Making Sure Capital Project Mix is Diverse
Project mix adjusts over time to meet campus needs
My Campus

20. 20
#4 Utilizing work order data to identify hot spots
$‐
$50,000.00
$100,000.00
$150,000.00
$200,000.00
$250,000.00
$300,000.00
$350,000.00
$400,000.00
$450,000.00
$500,000.00
KENNETH C ROWE MANA
HOWE‐FOUNTAIN HOUSE
CHAPTER HOUSE
ROBIE ST 1322
LSRI‐SOUTH TOWER
ELECTRICAL MOBILE 2
GOLDBERG COMPUTER SCIENCE BUILDING
CENTRAL SRV‐PARKADE
IND ENG&CONT ED
I MACNAB‐A BLD ADDI
RALPH MEDJUCK‐ADDIT
TUPPER BLDG
KILLAM LIBRARY
STUD. UNION BLDG
FORREST
MEMORIAL ARENA
LSC‐COMMON AREA
CHEMISTRY PODIUM
SEXTON MEMORIAL GYM
BERNARD CAIN‐Q BLDG
A.E. CAMERON‐P BLDG
SHIRREFF HALL
BURBIDGE
RALPH M MEDJUCK BLD
B BUILDING
UNIVERSITY CLUB
MACDONALD BLDG
UNIVERSITY AVE 6214
STAIRS HOUSE
COBURG ROAD 6414
UNIVERSITY AVE 6220
LYALL HOUSE
R1‐BUILDING
LEMARCHANT ST 1390
COBURG ROAD 6420
SEXTON HOUSE‐E BLDG
10 25 50 100
Total FY11 Daily Service Work Order Cost by Building & Age Category
Tupper Building
1380 Work Orders
$436,000
953 Work Orders
Dentistry
$380,000
Central Services
519 Work Orders
$372,000
652 Work Orders
Library
$260,000
Strategically “resetting” high cost buildings can reduce “corrective” ops. costs

21. 21
Opportunity to release operational FTEs
Buildings between 25‐50 yrs. old take longer to service
Age Category
Average hours/ DS
Work Order
Less than 10 4.10
10‐25 3.70
25‐50 5.25
Over 50 4.31
Age Category
Total Daily Service
Work Orders
Less than 10 1,295.00
10‐25 2,060.00
25‐50 8,774.00
Over 50 4,797.00
Reduce average work order time in
25‐50 yr. old buildings by 1 hour.
8774 work orders/1 hour= 8774
hours released!
8774 hours/2080 hours (1 FTE)=
4.2 Maintenance FTEs

22. 22
#5 Monitor Energy Cost and Consumption
45
40
35
30
25
20
15
10
5
0
FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11
$/MMBTU
Energy Unit Cost Trends VS. Peers
UVM Fossil Unit Cost
UVM Electric Unit Cost
Peer Fossil Unit Cost
Peer Electric Unit Cost
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
BTU/GSF
Energy Consumption Trends VS. Peers
UVM Fossil Consumption
UVM Electric Consumption
Peer Fossil Consumption
Peer Electric Consumption
Campus
Campus
Campus Campus

23. 23
UMass Amherst’s Experience

24. 24
University of Mass. ‐ Amherst Background Information
• Flagship public institution
• 10.4 M GSF
• Located in Amherst, MA
• Sightlines member since 2004

25. 25
Campus Overview ‐ 2005
Campus was aging Energy Consumption was Increasing

26. 26
Campus Overview 2005
FY00‐FY05 Investment
12%
17%
41%
13%
17%
Bldg. Envelope
Bldg. Systems
Space
Code
Infrastructure
Space‐heavy project spending

27. 27
Steps towards a solution
The Integrated Facilities Plan process
Identify
the needs
Segment
the needs
Develop a
strategy
Track
progress
towards
strategy
Reassess
plan
progress
& goals

28. 28
Findings of Initial Report
Over $2 billion in needs Over 60% of the needs
$2,500
$2,000
$1,500
$1,000
$500
$0
Identified Needs
Millions
Original Needs Identified ‐ 2006
Building Needs Infrastructure
New Construction
were near‐term
Existing Needs
61%
15%
24%
A: 1‐3 years B: 4‐6 years C: 7‐10 years

29. 29
Findings of Initial Report – continued
$600
$500
$400
$300
$200
$100
$0
Identified Needs by System and Timeframe
A: 1‐3 Years B: 4‐6 Years C: 7‐10 Years

30. 30
Segmenting the campus with the Building Portfolio Approach
Campus is too complex to be managed with a single strategy
Total Project
Inventory
$2,280 M
New Space
$571 M
Building Needs
$1,627 M
Transitional
Facilities
$196 M
Building
Renovation
$581 M
Repurpose
$40 M
Maintain
$812 M
Non‐housing
facilities
$602 M
Housing facilities
$208 M
Site &
Infrastructure
Needs
$80.4 M
Note: data shows current FY11 data

31. 31
Reassessing our Building Portfolio Designations
FY11 Building Investments by Portfolio
20%
17%
34%
0.21% 2%
25%
2%
Maintain
Maintain (Housing)
Building Renovation
Transitional
Repurpose
Infrastructure
New Space
Building Portfolio FY11 Investment ($/GSF)
Maintain $3.58
Maintain ( Housing) $4.30
Building Renovation $14.89
Transitional $1.54
Repurpose $1.29

32. 32
Using the inventory to make
strategic decisions

33. 33
Using the Net Asset Value (NAV) to identify opportunities
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
NAV – Maintain Portfolio Investment Strategy
0 10 20 30 40 50
“Keep Up” Stage: Primarily new or
recently renovated buildings w/
sporadic building repair & life cycle
needs
Balanced Profile Stage: Buildings are
beginning to show their age and may
require more significant investment
and renovation on a case‐by‐case
basis
“Catch Up” Stage: Buildings require
more significant repairs; major
building components are in jeopardy
of complete failure; large‐scale
capital infusions or renovations are
inevitable
Replacement Value – Deferred Maintenance
Net Asset Value = Replacement Value

34. 34
Bartlett Hall Operating Costs
FY08, FY09, FY10
Descriptive text goes here
$379
$118
$24
$173
$415 $414 $371 $400
$900
$800
$700
$600
$500
$400
$300
$200
$100
$‐
FY08 FY09 FY10 FY08‐FY10
Average
Thousands
Bartlett Hall Annual Operating Costs
$ in Thousands
Other Costs
Maintenance &
Custodial Costs
$794 $531 $395 $573
FY08-FY10 Average
Included in Analysis
Building Maintenance $ 60,888
Contract Administration $ 787
Contract Oversight $ 1 66,880
Custodial $ 3 39,167
Pest Control $ 308
Utilities $ 5,362
Total Included $ 5 73,393
Excluded in Analysis
Alterations $ 14,525
Moving Services $ 566
Total Excluded $ 15,091
Grand Total All Expenses $ 5 88,484
Understanding operating costs of old vs. new space…

35. 35
Descriptive text goes here
$5.04
$1.32
$6
$5
$4
$3
$2
$1
$0
FY08‐FY10 Average
$/GSF
Bartlett Hall & Alfond Hall
FY08‐FY10 Average Annual Operating Costs ‐ $/GSF
Bartlett Hall
Alfond Hall
Bartlett Hall Operating Costs
FY08, FY09, FY10
Numbers to Remember
Operating Costs
Bartlett Hall: $5.04/GSF
New Facility: $1.32/GSF
Understanding operating costs of old vs. new space…

36. 36
Renovate Existing or Demolish and Build New?
Determine 10‐Year total needs for the existing building vs. New Construction
Bartlett Hall
Descriptive text goes here
GSF 113,748
FY11‐FY20 Capital Needs $52.9 M
FY11‐FY20 Stewardship Needs $3.5 M
Immediate Funding to Address
Reliability Needs $5.7 M
FY11‐FY20 Operating Cost $5.7 M
Swing Space Funding TBD
Total Associated Costs $67.7 M
New Facility*
GSF 113,748
Demolition of Existing Bartlett Hall** $2.7 M
Planning/Relocation costs TBD
New Construction $51.2 M
FY13‐FY20 Stewardship Needs $6.5 M
FY13‐FY20 Operating Cost $1.2 M
Total Associated Costs $58.9M
Total 10‐Year Costs
$ in Millions
$53 $6
$54
$7
$3
$6
$1
$‐ $20 $40 $60 $80
Bartlett Hall
New Facility
Millions
*Opening of new facility assumed for 2013. Operating Costs based on $/GSF costs for Alfond Hall.
**Demolition estimated at $23/GSF (based on University Apartments demolition cost).
Capital Requirements
Reliability Needs
Stewardship Needs
Operating Costs
It is less expensive to demolish Bartlett Hall and
construct a new facility than to renovate the
existing facility.
•Non‐quantifiable factors:
•Current building configuration
•Program needs
•Funding options (donors for new space vs.
University/state funding for renovations)
Bartlett Hall

37. 37
Progress towards reduction of needs
Lowest existing needs since 12/2006
$1,479 $1,548
$1,974 $1,895 $1,831 $1,887 $1,792 $1,704 $1,627
$118
$121
$126
$107 $105 $106
$82
$85
$80
$640
$640
$457
$434 $434 $427
$410 $603
$571
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
Original IFP Dec. 06
Udpate
April 09
Update
Fall 09
Update
FY09 ROPA
Analysis
January
2010 Update
June 2010
Update
January
2011 Update
June 2011
Update
Millions
IFP Identified Needs by Update Stage
Building Needs Infrastructure New Space

38. 38
Progress with project selection
Space‐heavy project spending
FY00‐FY05 Investment
12%
17%
17%
41%
13%
Bldg. Envelope Bldg. Systems
Space Code
Infrastructure
Balanced spending mix
FY06‐FY11 Investment
11%
26%
22%
29%
12%
Bldg. Envelope Bldg. Systems
Space Code
Infrastructure

39. 39
The keys to success
• Understanding key metrics and how UMA compared
with peers
• A comprehensive list of identified needs
Knowing where
we were
• Making decisions about the future of specific
buildings
• Creating investment strategies by building portfolio
Creating A Plan
• Regular review of successes and failures
• Adjust as necessary – flexibility is important
Monitoring the
Plan