heriot - watt university - watt university estates strategy 2008 september 2008 2 summary 25 the...

Heriot - Watt University Estates Strategy 2008

September 2008

H E R I O T - W A T T U N I V E R S I T Y E S T A T E S S T R A T E G Y 2 0 0 8

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Heriot - Watt University Estates Strategy 2008

Executive Summary 4

Introduction 4 Strategic Objectives 4 The Estates Vision and Future Requirements 5 Review of Existing Estate 6 Estates Performance 7 Strategic Estates Options and Appraisal 7 The Way Forward 8

1. Introduction 11

Heriot - Watt University 11 Higher Education Context 11 Aims of the Estates Strategy 12 Structure of the Estates Strategy 13

2. Approach to the Estates Strategy 14

Introduction 14 Approach 14 Information gathering and review 14 Identifying Strategic Estate Issues 15 Development and evaluation of Strategic Estate Options 16 The preferred strategy and implementation plan 16

3. Strategic Objectives 17

Introduction 17 Strategic Direction and Vision 17 Academic and Research Vision 17 Student Numbers 18

5 Year forecast 18

10 Year forecast 20

Support Services 20 Student Experience 20 International Dimension 21 Sustainability 21 Summary of University Strategic Objectives 22 Strategic Estate Objectives 22

4. The Estate Vision and Future Requirements 24

Introduction 24 Previous Estates Strategy 24

Estates Strategy 1999 24

Estates Masterplan 25


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Summary 25

The Estate Vision 25 Teaching and Research 26 Learning and Student Experience 26 Student Residences 27 Environmental 27 Service Delivery 27 Assumptions for Future Requirements 28

5. Review of Existing Estate 34

Introduction 34 Background and Campuses 34 Stromness, Orkney 34 Dubai Academic City, Dubai 34 Scottish Borders Campus, Galashiels 35 Riccarton, Edinburgh 36

Background and Overview 36

Area 37

Tenure 38

Building Age 39

Condition and Legislative Compliance 40

Space Management/ Utilisation 44

Use/ Functional Suitability/ Fitness for Purpose 45

Running Costs 46

Valuation 48

Environmental 48

Planning 50

Service delivery 50

Summary 52

6. Estates Performance 54

Introduction 54 Estate Critique 54 Gap Analysis 55 Programme and Affordability Issues 56 Specific Building Issues 57 Estates Strategy Implementation Plan and Monitoring 58

7. Strategic Estates Options and Appraisal 59

Introduction 59 Range of Strategic Options 59

Option 1 –do minimum/ base case 59

Option 2 – develop the estate in accordance with the existing Capital Plan 59

Option 3 – develop the estate to reflect future requirements 60


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Option 4 – relocation to a new site 61

Options Appraisal 62 Financial Appraisal 62

Qualitative Appraisal 63

Preferred Option 64

8. The Way Forward 65

Introduction 65 The Preferred Option 65 Project Development and Implementation 66 Prioritisation of Projects 67 Flexibility and Review Procedures 68 Risk 69

Available funding 69

Resources 69


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Executive Summary Introduction This report sets out the Estates Strategy for Heriot - Watt University (the University) for the period 2008 -2018. The Estates Strategy has been prepared in accordance with the Scottish Funding Council (SFC) Circular SFC/34/2007: Estate Strategy guidance, published in July 2007.

In developing the Estates Strategy the following key stages have been undertaken:

Extensive consultation exercise with key stakeholders within the University

Review of the existing estate

Assessment of future estate requirements

Development of strategic estate options and appraisal

An implementation plan for the delivery of the Estates Strategy.

Strategic Objectives In 2007, the University initiated a strategic review of all of its activities including both academic and professional support. The strategic review was undertaken to recognise the University’s strengths and to drive its future direction and growth strategy. As part of this process the University has recently published Focus on the Future: Heriot-Watt University Strategy 2008. This document sets out an ambitious and decisive strategy setting the direction of the University to 2015.

The intention is to place the University at the forefront of research and research led education in the UK and internationally. This will reshape the University and the intention is to grow the academic staff base by 50% over the next ten years. As part of the strategy the University wishes to compare itself to the 1994 Group of universities.

As part of the strategic review the University has set up five academic theme teams, which will be at the forefront of developing the future research and teaching activities. The five theme teams are as follows:

Environment and Climate Change

Infrastructure and Transport

Energy

Modelling and Risk

Life Sciences.

In addition the University has also set up a number of support services theme teams, which are as follows:

People

Physical Infrastructure

Organisation and Process

Information Technology


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The business plans from both academic and support services theme teams are due to be completed in Autumn 2008 and will form the basis of University’s new Strategic Plan. Whilst this process is still in development, there are a number of clear objectives which will underpin the University’s strategic direction over the next ten years, which are:

Academic staff to increase from 440 to 640

Increase in non academic staff to service this number, estimated to 500

Reduce non-academic to academic staff ratio by 10%

Total staff numbers estimated at 2,300 against the existing 1,600

Student numbers to rise by circa 2,000

Facilities to reflect more research intensity

Flexible, high quality teaching and learning space

Sustainable (financial and environmental) well maintained estate.

The Estates Vision and Future Requirements At an estates level the University’s new strategic direction results in the following strategic estate objectives:

Deliver a non residential estate of an appropriate size to support the future development of the University

Provide suitable research space to enable the University to deliver it’s research strategy

Ensure the configuration of the estate delivers an appropriate learning and teaching environment to support the current and predicted direction of curriculum delivery

Deliver appropriate support and recreation spaces for the numbers of students currently and predicted to be at the University

Deliver residential accommodation to support the predicted student numbers and international student recruitment

Investment in the conference business to provide a competitive offer to support the development of the University’s research profile

Perform to targets around the environmental and financial sustainability of the estate

Utilise every opportunity of improvement of the estate to generate competitive advantage for the marketing of the University

Set targets to improve space management and space efficiency

Ensure condition, maintenance and functional suitability are improved to target levels and maintained

Maximise income generation from the estate.


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For each of the strategic estate objectives, assumptions have been developed to allow for the options to be appraised and compared.

Review of Existing Estate A detailed assessment of the University’s existing estate has been undertaken in accordance with the SFC guidance. This has identified the following:

The University is to continue to operate out of its four existing locations. The Dubai, Orkney and Scottish Borders campuses have been identified as no change for the purpose of the Estates Strategy with the focus on the main campus at Riccarton, Edinburgh

The Riccarton campus extends to 364 acres and 162,636 square metres of building and infrastructure space

The University is faced with a backlog maintenance of over £100 million, with current levels of expenditure significantly below recommended levels in terms of providing a sustainable estate

There are significant maintenance, functional suitability, energy performance issues regarding a number of the original 1970’s buildings within the campus. It may be more appropriate to redevelop these buildings rather than undertaking refurbishment

The existing management of space within the University makes it difficult to accurate assess space utilisation. A review of space management is critical in accommodating the University’s anticipated growth

There are significant issues regarding the functional suitability of buildings across the University’s estate

Whilst the University compares favourably against other 1994 Group campus based universities in respect of running costs, the low level of spending on maintenance and property management appears to have had a detrimental impact on the estate. Significant recent increases in utilities costs with anticipated further rises will further increase the ongoing costs of operating and managing the estate

The lack of an EIMS system makes it difficult to assess running costs on a building by building basis

The existing environmental performance of the estate is poor and needs to be addressed as part of any strategy, particularly given increasing utilities costs

Due to the campus location within the Green Belt and a number of title restrictions, there is very limited opportunities to dispose of parts of the campus to release significant capital receipts

The existing Estates and Building Services team appears very under resourced and is doing well to ensure the ongoing steady state of the estate. Any significant investment in the estate may be at risk due to the lack of resource to allow for the planning, development and delivery of projects.


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Estates Performance A critique of the existing University estate against the University’s vision has identified that there is a significant gap in the existing provision. In particular there is a requirement to address the following key issues:

The Library is no longer fit for purpose and there is a lack of learning space/ study group space for students

The campus core needs to be developed to reflect increased student numbers, in particular the function and use of the Hugh Nisbet building requires to be considered. Any redevelopment option will need to ensure that there is continued access to the main lecture theatres within the building

The individual academic departments suffer from a lack of front door and focus area for students and visitors. This is believed to be an impediment to departments establishing a strong identify

A significant part of the estate is tired and in need of refurbishment to address, statutory compliance, backlog maintenance and functional suitability issues

There is a need to replace the older student residences

A lack of suitable residential accommodation for the conference business and the lack of development of phases 2,3 and 4 of the Research Park is believed to have an impact on the potential income generation from the estate

There is a need to introduce a more efficient approach to space management to improve utilisation across the estate.

Strategic Estates Options and Appraisal For the purposes of the Estates Strategy no change has been assumed for the University’s Dubai and Orkney campuses. At SBC it is identified that the key requirement is for the replacement of the student residences, otherwise no change is proposed. As this will be a constant in all the options, the strategic estate options have been developed for the Riccarton campus.

To address the gap in the existing provision at Riccarton and the University’s proposed vision, four strategic estate options have been developed and appraised in both financial and qualitative terms. This in accordance with HM Treasury Green Book. The strategic estate options are as follows:

Option 1 – do minimum

Option 2 – develop the estate in accordance with the existing Capital Plan

Option 3 – develop the estate to reflect future requirements

Option 4 – relocation to a new site.

Option 4 was discounted from detailed appraisal as it was not considered viable, whilst Option 1 was only appraised to provide a baseline to allow comparison against the other options.


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The results of the financial and qualitative appraisal are set out within the table below:

Financial Qualitative Option Description

NPC (£M) Ranking Score Ranking

1 Do minimum/ base case [tbc] 1 9.5 3

2 Develop the estate in accordance with the existing Capital Plan

[tbc] 2 23.5 2

3 Develop the estate to reflect future requirements

[tbc] 3 36.5 1

The results of the financial and qualitative appraisal does not result in the clear identification of a preferred option. Discounting Option 1, from a financial perspective Option 2 is the most beneficial to the University and reflects a level of investment in accordance with the University’s Capital Plan. However, it does not fully meet the requirements of the University’s new strategy set out in Focus for the Future which is reflected in the qualitative analysis score.

Option 3 is clearly ranked first in respect of the qualitative criteria, however, the Net Present Cost (NPC) and level of investment required is significantly above Option 2. There are clear issues regarding the potential deliverability of this option from a financial perspective. In addition, a number of the assumptions and potential projects within Option 3 are dependant on the success of the implementation of the University’s new strategy under Focus for the Future. At this stage, it is perhaps too early within the process to identify what the actual requirements will be for the University’s estate.

On this basis it is recommended that Option 2 is the preferred option for the Estates Strategy.

The Way Forward The implementation and delivery of the Estates Strategy involves a significant number and range of projects. The failure to implement the outcomes of the 1999 Estates Strategy has increased the need for urgent and extensive action across the estate. The University is not in a position to allow this to happen again.

The SFC is about to issue revised guidance on the Capital Planning Process and it is recommended that the University adopts the use of this guidance as part of its processes for the development and implementation of projects.

We have summarised below the key stages that should be adopted as part of the project development and implementation process:

Feasibility study and Business Case

Funding availability

Project approval

Implementation

Post Occupancy Evaluation (POE).

Given the extensive number of projects to be delivered, it is evident that there requires to be an element of prioritisation reflecting availability of funding and resources. The table below summarises the proposed prioritisation and timescales for the projects within the Estates Strategy:


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Project Priority Timescale

New residences and associated facilities at Riccarton

Immediate 2008 – 2012

New residences at SBC Immediate 2008 – 2010

Hugh Nisbet building refurbishment High 2010 – 2013

New Library High – but dependant on re-provision of Residences I and II

2012 – 2014

Learning spaces refurbishment and Study Group building

Learning spaces – High Study Group building – Medium

2009 – 2011

Conference accommodation High 2012 – 2015

Refurbishment and upgrade of teaching and research space

High Ongoing annual programme

Compliance and maintenance works Immediate Ten year programme of works developed

Land purchase to the south of the campus Medium 2015 – 2016

Space Management Project Immediate 2008 – 2009

EIMS system High 2008 – 2010

Masterplan refresh High Following completion of strategic review

Future development of the Research Park High Ongoing

Feasibility studies to reflect the requirements of the strategic review

Medium Ongoing as specific requirements begin to emerge

As the University’s new strategy is still being developed, it is important to ensure that the Estates Strategy is flexible to respond to emerging requirements. It is recommended that feasibility studies are undertaken where required to identify how best emerging requirements can be addressed across the estate.

A key aspect of ensuring the flexibility of the Estates Strategy is to ensure that it is reviewed on a regular basis. In addition to the requirement to submit an annual update of the Estates Strategy to the SFC, it is also recommended that the University adopts the following review procedures:

Regular monitoring by the University’s Estates Strategy Committee

Reported on annually to the University Court

Projects are subject to regular formal review, regarding progress, target dates and achievement of milestones

Formally reviewed every three years by internal audit.

It is also necessary to consider the principal risks which may impact on its potential implementation and delivery of the Estates Strategy. Principally this is focused on the availability of funding and resources within the University.

Lack of available funding is clearly a key risk to the delivery of the Estates Strategy and would appear to have a detrimental impact on the delivery of the 1999 Estates Strategy. We understand that the University is in the process of gaining approval to borrow the required funding set out within the Capital Plan. If approved this funding requires to be ‘ring fenced’ for the projects outlined within the Estates Strategy. It will also be necessary to ensure that a whole life cost approach is adopted so that sufficient funding is set aside to ensure that new and refurbished buildings are appropriately maintained. The recent publication BS ISO 15686-5 Buildings and


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constructed assets, service life planning, life cycle costing has been recognised as an international standard for life cycle costing by the RICS and it is recommended that this guidance is used by the University in assessing the whole life costs of projects.

In addition to the Capital Plan funding, it will also be important that the University ensures that there is appropriate funding and resources available to address some of the non capital elements within the Estates Strategy such as the Space Management Project.

The University’s existing Estates and Building Services department appears to be very under resourced when compared to similar sized institutions. The existing resource appears to be currently over stretched in ensuring that the estate continues to function on a day to day basis.

Given the number and range of projects that are proposed under the Estates Strategy, this will significantly increase the workload on the Estates and Building Services department. Clearly there is a significant risk to the delivery of the Estates Strategy through the lack of sufficient resources within the department.

It is recommend that a review of the existing structure, roles and responsibilities with the Estates and Building Services department is undertaken together with an assessment of the likely resource input required for the delivery of the Estates Strategy. This will allow for a more detailed consideration of the potential risk and the resource implications required for the delivery of the Estates Strategy.


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1. Introduction 1.1 This report sets out the Estates Strategy for Heriot - Watt University (the

University) for the period 2008 -2018. The Estates Strategy has been prepared in accordance with the Scottish Funding Council (SFC) Circular SFC/34/2007: Estate Strategy guidance, published in July 2007.

1.2 One of the main aims of the SFC corporate plan is that Scotland’s universities are highly effective, world class organisations and within this there is a specific objective of high quality buildings, facilities and equipment. A key element in achieving this objective is by having estate strategies embedded in institutional strategic planning thereby linking estates development appropriately with learning, teaching and research strategies.

Heriot - Watt University 1.3 The University is a leading institution in science, technology and business

and excels as Scotland’s most international university. The University currently provides more graduates per year across the areas of physical sciences, mathematics, engineering and the built environment than any other Scottish University.

1.4 In 2007 the University initiated a strategic review of all of its activities both academic and professional support. The strategic review was undertaken to recognise the University’s strengths and to drive its future direction and growth strategy.

1.5 The University has recently published Focus on the Future Heriot - Watt University Strategy 2008. This sets out the University’s future strategic vision and direction to 2015. This vision is to become a world leading university at the forefront of research and research led education in UK and internationally. Part of this vision is for the University to have a similar profile as the ‘1994 Group’ of research intensive universities.

1.6 As part of the intention to reshape the University the intention is grow the academic base by 50% over a ten year period. In line with the commitment to grow the academic base, the University’s intention is to develop professional support services, infrastructure and its estate.

Higher Education Context 1.7 The period between the production of the University’s previous Estates

Strategy in 1999 and today has seen a significant shift in the importance of the estate from a delivery platform for teaching and learning to a strategic component of many Universities’ competitive marketing advantage. This is obviously a direct consequence of the general shift in society of higher service demands and increasing consumerism in all choices. In addition, this drive will have been triggered in Heriot - Watt’s competitor institutions in England by the increasing view students have of themselves as “customers” through paying sometimes significant tuition and top up fees.

1.8 There are two direct consequences of this marketing dimension to the estate. First, there is the direct impact of Universities making choices to improve their estate to support their competitive edge, and secondly, there is the cumulative effect of raising the bar requiring all Universities to improve to stand still.

1.9 There is also anecdotal evidence linking changes driven through the estate to more profound changes in institutional culture and the benefits that can


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derive from staff feeling increasingly valued because their curriculum area has been invested in.

1.10 Another fundamental shift in the period since the 1999 Estates Strategy has been the consistently tightening financial envelope especially in terms of revenue budgets. This has been accompanied by the Estate Management Statistics (EMS) exercise enabling Universities to compare Key Performance Indicators (KPI’s) across their estates based on a standardised annual return. The net effect has been to put comparative information about the estate on a level far above any other support area in the sector.

1.11 Clearly, the financial pressures point to any savings sought being in the high expenditure areas of the institutions, so staff costs and estate costs will come under scrutiny. The main function of estate costs is the quantum of space the institution occupies so space management has increasingly been on the agenda both for Universities and the funding councils. The Space Management Group has produced 6 reports detailing good practice in space management and developing a series of tools for Universities to utilise in their management of the estate.

1.12 This emphasis on space management is also driven by a desire to identify space efficiencies which can be met from relatively less expensive refurbishment with limited impact on running costs before considering new build as an option.

1.13 Finally, since 1999 there has been a significant emphasis placed on learning outcomes around students working in teams. This has led to a demand for a study space that blurs the edges between traditional learning spaces and social spaces. Several examples such as the Learning Grid at Warwick University and the Learning Café at Glasgow Caledonian University are oft quoted, but virtually every university is looking at ways of developing these spaces within their estate and grappling with whether to have a large centralised facility or several smaller ones or a hybrid of a main facility with satellites. Also, institutions are having to take decisions on whether these spaces are mainly social facilitating group interaction, typically with associated catering facilities or higher tech spaces more focussed on academic work.

Aims of the Estates Strategy 1.14 The SFC guidance defines an estate strategy as:

‘an estate strategy is a long term strategic plan for developing and managing the estate to its maximum potential to meet the University’s key objectives’.

1.15 The SFC guidance identifies that the aims of an estate strategy are as follows:

Provide suitable, fit for purpose accommodation

Provide the most efficient use of available space

Identify the need for rationalisation and disposal of assets which are surplus to requirements

Maximise the value of the estate, looking at existing and alternative uses


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Providing flexibility in considering opportunities regarding operational, financial or resource implications, including collaboration and/ or co-location.

1.16 The Estates Strategy has therefore been developed to reflect the University’s vision and direction within the changing context of Higher Education and in accordance with the SFC guidance.

1.17 In particular, it focuses on the estate implications of the University’s strategic objectives and assess the existing adequacy and suitability of the existing estate to contribute to the delivery of these objectives and identifying the potential gap in requirements. The Estates Strategy then identifies a series of strategic options that have been evaluated to select the preferred solution for the University moving forward. It then sets out the proposed priorities and way forward for the development of the estate.

1.18 The Estates Strategy has been developed to act as an active ‘management tool’ for the future development and ongoing management of the University estate. In accordance with the SFC guidance it will be revisited and updated on an annual basis. It also sets out a range of objectives and priorities for the development and management of the estate, these will be used as part of the evaluation process for measuring the feasibility and relevance of future estate projects.

Structure of the Estates Strategy 1.19 The Estates Strategy has been developed to create a structure in

accordance with the SFC Estate Strategy guidance. It is divided into the following sections:

Section 2: Approach to the Estates Strategy – sets out the approach and methodology used in the development of the Estates Strategy

Section 3: Strategic Objectives – identifies the key strategic drivers that underpin the Estates Strategy

Section 4: The Estate Vision and Future Requirements – sets out the vision and future estate requirements

Section 5: Review of Existing Estate – is an assessment of the University’s existing estate in terms of its locations, condition, utilisation and fitness for purpose

Section 6: Estates Performance – assess the University’s vision and requirements against the existing estate and provides a gap analysis to form the basis of a range of strategic estates options

Section 7: Strategic Estates Options and Appraisal – details a series of strategic estates options, their evaluation and the identification of a preferred option

Section 8: The Way Forward – identifies the way forward and prioritisation of projects across the University’s estate.


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2. Approach to the Estates Strategy Introduction

2.1 In this section we have set out details of the approach and methodology that was adopted in developing the Estates Strategy.

Approach 2.2 The approach developed for undertaking the Estates Strategy reflects the

revised Estate Strategy guidance issued by the SFC in July 2007. The approach consisted of four principal stages, which were as follows:

Information gathering and review

Identifying strategic estate issues

Development and evaluation of strategic estate options

The preferred strategy and implementation plan.

2.3 A brief overview of the tasks undertaken in each of these stages is set out below.

Information gathering and review 2.4 The first stage in the development of the Estates Strategy involved a review

of a range of existing information regarding the University and its estate.

2.5 As outlined previously the current estate strategy development exercise is running in parallel but slightly ahead of the work being undertaken to develop the University’s new corporate plan. As part of this process five academic “theme teams” have been set up to which are to lead and direct the development of the University’s future research and teaching activities. A number of theme teams have also been recently set up to review support services functions across the University in response to the proposed research and teaching activities of the University. The output of these “theme teams” will be cross checked and each theme will be a sub-section of the new corporate plan.

2.6 Whilst the University has recently published ‘Focus for the Future’ setting out its future strategy to 2015, the finalised business plans from the academic theme teams and the support services theme team are not due to be completed till autumn 2008.

2.7 There is a requirement to deliver a Estates Strategy for the end of June 2008. There will clearly be a need to revisit and update the Estates Strategy in the light of hard output and findings from the theme teams and the University’s new corporate strategy.

2.8 As a result of the above, the review of existing information has been focused on information in respect of the University’s existing estate. This has included:

University’s previous Estates Strategy – prepared in 1999

Dearle & Henderson – Condition & Compliance Survey

EMS statistics

University’s Masterplan – prepared in 2000


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University’s Capital Programme: 2008 - 2018

West Edinburgh Local Plan.

Identifying Strategic Estate Issues 2.9 In conjunction with the review of the existing estate an extensive and

rigorous consultation exercise has been undertaken. As set out in the SFC guidance, consultation has a key role to play in raising the profile of an estate strategy and increasing its relevance to key stakeholders.

2.10 The consultation exercise involved carrying out interviews with a wide range of key stakeholders across the University. This included:

The Principal, Secretary and Vice Principals of the University

Heads of Academic Schools and Academic Theme Team Leaders

Heads of department within the principal support functions across the University

Heads of committees within the University Court

The Student Association

Team members within the Estates and Building Services Department.

2.11 A full list of the key stakeholders interviewed as part of the consultation exercise is included in Appendix 1.

2.12 The rigorous consultation process has enabled the capture of a range of key strategic estate issues facing the University and which will from the drivers for the development of the Estates Strategy. These issues have also been fed back into the work being undertaken by the various theme teams.

2.13 In particular, the key strategic estate issues identified through the consultation exercise for the Estates Strategy, provided an independent verification of the principal findings of the University’s Physical Infrastructure theme team. This was developed through a separate exercise to the Estates Strategy process.

2.14 Following an initial set of consultation interviews a ‘Key Issues Paper’ was developed to reflected the common views gathered. This was then used as a basis for subsequent consultation interviews with the Key Issues Paper updated as necessary to reflect feedback.

2.15 The Key Issues Paper was developed in a tabular format with the following headings:

Strategic Issue

Challenge for the estate

Requirements

Proposals/Assumptions for the Estate Strategies

Priorities.


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2.16 The Key Issues Paper then formed the basis for the development of the future vision and requirements for the University estate. A copy of the Key Issues Paper is included in Appendix 2.

Development and evaluation of Strategic Estate Options

2.17 The output gathered from stages 1 and 2 was used to undertake a ‘gap analysis’ between the University’s existing estate and the future vision and direction of the estate. This was then used as the basis to develop a range of strategic options for the future of the University’s estate.

2.18 These strategic options were then appraised both financially and on a qualitative basis and a preferred option identified.

The preferred strategy and implementation plan 2.19 The final stage was to development of the preferred option into a series of

sustainable projects to be delivered across the University’s estate during the period of the Estates Strategy. In developing projects, consideration was given to:

Financial sustainability

Physical sustainability

Environmental sustainability.

2.20 The range of projects was then prioritised and an implementation plan developed reflecting their timescales for delivery.


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3. Strategic Objectives Introduction

3.1 In this section we have set out details of the strategic objectives of the University and how these underpin and drive the Estates Strategy. It should be noted, that this section has been developed from Focus for the Future and the consultation exercise and will require to be reviewed in light of the finalised theme team outputs and a new corporate plan for the University.

Strategic Direction and Vision 3.2 In 2007 the University initiated a strategic review of all of its activities both

academic and professional support. The strategic review was undertaken to recognise the University’s strengths and to drive its future direction and growth strategy.

3.3 The University has recently published Focus on the Future: Heriot-Watt University Strategy 2008. This document sets out an ambitious and decisive strategy setting the direction of the University to 2015.

3.4 The intention is to place the University at the forefront of research and research led education in the UK and internationally. This will reshape the University and the intention is to grow the academic base by 50% over the next ten years. This proposes an increase in the number of academic staff from the current 440 to 640 over this period.

3.5 Focus on the Future sets out that the University’s vision for the next decade is:

“to become a world leading university – a university which will produce the next generation of global leaders in business and technology.

In order to deliver this ambition, we are committed to growth in investment, both in staff and infrastructure.”

3.6 As part of this vision the University intends to:

“develop our best potential to address some of the major global challenges that the world faces. Heriot - Watt University has set itself a very clear and ambitious vision.

We have defined our role on the world stage as a leader for innovation in science, engineering and business in Scotland, as one of the UK’s leading research intensive universities, and one of the world’s leading technological and business universities.”

Academic and Research Vision 3.7 The University has a clear aim of strengthening its position as a leading

university, for innovation in science, engineering and business with the intention to define its presence on the international stage within these areas of key world importance.

3.8 As part of the strategic review five ‘Academic theme teams’ were established. The theme teams reflected the areas where the University is already established as being at the forefront of innovation in teaching and research and would form the basis for much of the future growth of the University.


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3.9 The five academic theme teams are as follows:

Environment and Climate Change

Infrastructure and Transport

Energy

Modelling and Risk

Life Sciences.

3.10 Each of the academic theme teams draws on expertise from across various academic schools within the University. This has the aim of raising levels of cross working and knowledge transfer across the academic schools.

3.11 Draft business plans have been developed by each of the academic theme teams, setting out the principal areas of teaching and research that will drive the future growth of the University. The business plans include details of likely staff growth and potential students numbers. Some of the theme teams have identified initial high level accommodation requirements, however, these are yet to be fully considered in terms of the potential impact on the University estate.

3.12 The individual business plans for each of the academic theme teams are due to be completed by Autumn 2008. The output will then be drawn together as part of a new University Strategic Plan.

3.13 For the purposes of the Estates Strategy it has been assumed that there will be no immediate estate implications as a result of the output from the academic theme teams. This will require to be revisited once the output from the academic theme teams is formalised and approved by the University.

Student Numbers 3.14 The University’s future strategy is to become more research intensive and

as part of this is targeting growth in the numbers of postgraduate students together with sustained growth in undergraduate students.

3.15 The University is already established itself as Scotland’s most international university and the attraction of more overseas students together with more opportunities for distance learning/ part time students are key elements of the planned strategy for growth.

5 Year forecast

3.16 At the Scottish based campuses, in terms of full time equivalent (FTE) students the University has forecasted rise in student numbers from 7,019 in 2008/09 to 8,020 by 2012/13. This represents growth of approximately 14% over the five year period.

3.17 A detailed breakdown of the actual numbers for the year 2007/08 and the proposed student growth during the period 2008/09 to 2012/13 is set out in the table below.


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ACTUAL PLAN 08 - BUDGET NUMBERS PROPOSED BY SCHOOLS

2007/8 2008/9 2009/10 20010/11 2011/12 2012/13

TOTAL (EX OTHER) Heads 11,027 13,262 14,153 14,997 15,610 15,991

FTEs 8,577 9,423 10,025 10,643 11,105 11,366

SCOTLAND UG HEU FT 4,820 4,959 5,082 5,156 5,241 5,294

HEU PT 136 102 128 174 198 198

OS FT 356 388 453 517 578 605

OS PT 6 11 11 11 13 13

PGT HEU FT 406 463 512 566 591 610

HEU PT 112 129 140 145 157 161

OS FT 528 627 695 755 784 805

OS PT 62 72 84 84 85 85

PGR HEU FT 197 200 214 223 237 237

HEU PT 35 42 40 42 42 42

OS FT 181 197 201 208 210 214

OS PT 8 13 12 12 10 10

Sub-total1 Heads 6,847 7,203 7,572 7,893 8,146 8,274

FTEs 6,668 7,019 7,365 7,659 7,894 8,020

DUBAI UG FT 207 312 454 605 720 767

PT 4 21 48 60 58 82

PGT FT 61 56 76 91 106 99

PT 275 277 273 318 355 384

Sub-total2 Heads 547 666 851 1,074 1,239 1,332

FTEs 408 517 691 885 1,033 1,099

DDL UG Heads 2,516 3,350 3,480 3,705 3,850 3,960

FTEs 1,148 1,430 1,471 1,578 1,644 1,698

PGT Heads 1,117 2,043 2,250 2,325 2,375 2,425

FTEs 354 457 499 521 535 549

Sub-total3 Heads 3,633 5,393 5,730 6,030 6,225 6,385

FTEs 1,502 1,887 1,970 2,099 2,179 2,247

OTHER 1. specify … 0 50 50 50 50 50

2. specify … 0 0 0 0 0 0

3. specify … 0 0 0 0 0 0

Sub-total 3 Heads/ 50

FTEs

3.18 The table above highlights a number of key trends in the proposed student numbers at the University which are set out below:

The growth in undergraduate students is focused on part time UK based students (94%) and full time overseas students (68%) over


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the five year period. The full time undergraduate students numbers are forecast rise by 7% over this period

Growth is anticipated across the majority of the taught postgraduate courses, with UK full time and part time postgraduate numbers proposed to grow by 31% and 25% respectively. Full time and part time overseas postgraduate student numbers proposed to grow by 28% and 18%.

The numbers of postgraduate research students is proposed to grow by 13% over the five year period

Growth is anticipated through distance learning with a small proposed increase of 19%

Clearly the above will have a direct impact on the University estate. Proposed growth in numbers of overseas students is likely to have a direct impact on the needs and type of residential accommodation and it will also be important to ensure that appropriate cultural facilities are provided as part of the overall student experience.

10 Year forecast

3.19 Focus for the Future identifies that looking forward over a ten year period students numbers are expected to rise to above 8,000. At present the University’s student number forecast only covers the period to 2012/13, whilst the period covered by the Estates Strategy is to 2018. As a result the student numbers from 2008/09 to 2012/13 have been extrapolated to cover up to the period up to 2017/18. This forecast is included in Appendix 3.

Support Services 3.20 The strategic review has also considered the requirements for professional

support services as part of the University’s future direction and growth strategy. With the academic strategy for growth in research, learning and teaching its is vital that this is securely underpinned by appropriate professional services.

3.21 Four support services ‘theme teams’ have been established by the University. These are as follows:

People

Physical Infrastructure

Organisation and Process

Governance.

3.22 The business plans for the support services theme teams are due to be completed by Autumn 2008. These will be used along with the academic theme team outputs to from the basis of the University’s new Strategic Plan.

3.23 As outlined previously, the initial findings from the Physical Infrastructure support service theme team have closely mirrored the findings identified as part of the Estates Strategy consultation exercise.

Student Experience


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3.24 Focus for the Future sets out the University’s commitment to providing excellence within the learning environment and student experience.

3.25 This commitment includes working towards a ‘one stop shop’ approach for student support through the co-ordination of the relevant professional support services and the Student Association. The development of learning and social learning spaces to meet students needs is seen as critical to the successful achievement of the strategy and an area where the University intends to make significant investment.

3.26 A bedrock of the University’s strategy is to foster a culture of high expectations and high achievement. The University is committed to systematically seeking the views of its students ensuring that they are taken on board. Co-ordinated induction programmes will be introduced across the University to ensure quality and consistency.

3.27 The University is strong in its student representation and the roles that are given to students on University management boards. These will be expanded to embrace research and taught postgraduate students.

3.28 The University is committed to continue introducing the most up to date technology and new ways of learning. This will continue to enhance the experience of its students and create new learning opportunities.

International Dimension 3.29 As outlined above the University is aware that it operates within a global

marketplace, and that it has already established itself as Scotland’s most international university. In comparison with many of its competitors its outreach is stronger and the presence widely established throughout the world.

3.30 The University already operates an overseas campus in Dubai and over the next ten years the University is seeking to increase its global outreach. This is seen through either introducing more campuses overseas or by extending the already established innovative network of learning partnerships. This currently comprises 50 institutions in 30 countries.

3.31 Currently, some 75% of Scottish degrees studied abroad are Heriot - Watt University degrees and the University intends to maintain this leading position. The University believes that its areas of planned growth within its model of transnational education has great potential as a means of projecting Scotland’s reputation for quality university education around the world.

Sustainability 3.32 Sustainability is a much used word in modern society and can mean many

things to different parties. Sustainability issues are at the core and fundamental to a number of the research and teaching activities envisaged by the academic theme teams. In this aspect the University must be able to ‘practice what it preaches’.

3.33 The University is committed to ensuring that its future strategy is developed and underpinned on the basis of:

Financial sustainability

Physical sustainability

Environmental sustainability.


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3.34 The University has established a working party, which will have responsibility for developing an overall sustainability policy for the institution. The sustainability policy will be developed in accordance with the recently published SFC Sustainable Development Guidance for Estate Management where appropriate.

Summary of University Strategic Objectives 3.35 Whilst the University is still in the process of developing its new Strategic

Plan, a number of clear objectives are now evident that will be a the forefront in underpinning its future strategic direction over the next ten years. These are summarised below:

Academic staff to increase from 440 to 640

Increase in non academic staff to service this number, estimated to 500

Reduce non-academic to academic staff ratio by 10%

Total staff numbers estimated at 2,300 against the existing 1,600

Student numbers to rise by 1,800+

Facilities to reflect more research intensity

Flexible, high quality teaching and learning space

Sustainable (financial and environmental) well maintained estate.

Strategic Estate Objectives 3.36 As outlined previously the current Estate Strategy development exercise is

running in parallel but slightly ahead of the work being undertaken to develop the University’s new strategic plan. As a result this Estates Strategy has been developed. There will however, be a need to revisit the Estates Strategy in the light of the finalised output from the theme teams and the new Strategic Plan.

3.37 That said, the rigorous consultation process has enabled the capture of many common issues. Where possible, assumptions have been made to quantify these issues in estate terms and they will feature within the proposed options in this strategy.

3.38 An initial list of key priorities fundamental to the Estates Strategy are summarised below:

Deliver a non residential estate of an appropriate size to support the future development of the University





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3.39 These objectives are discussed in more detail in the following section.


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4. The Estate Vision and Future Requirements Introduction

4.1 In this section we have set out the future vision and requirements for the University’s estate. This has been developed in response to the University’s ‘Focus for the Future’ and the findings from the rigorous consultation exercise set out within the Key Issues Paper.

4.2 As outlined previously there will clearly be a need to revisit the estate strategy in the light of hard output from the ‘theme teams’ and the new corporate strategy.

Previous Estates Strategy Estates Strategy 1999

4.3 The University’s previous Estates Strategy was completed in 1999. This concluded that options to remodel the existing University estate to meet the strategic objectives of the Strategic Plan to 2001/02, together with consideration of the University’s medium to long term objectives up to 2025 was the preferred option for the estate.

4.4 Within the previous Estates Strategy a number of key issues were identified for future consideration. Within Appendix 4 we have set out a table of identifying these key issues, together with the progress made by the University in addressing them since the previous strategy and also their relevance to the current Estates Strategy.

4.5 Some of the key issues that have been addressed since the 1999 strategy are set out below:

New Colin Maclaurin building for Mathematics and Actuarial Mathematics

Provision of a new medical centre

Development of the Sports Academy and enhancement of other sports facilities

Refurbishment of the main lecture theatre theatres within the Hugh Nisbet building

Development of a new Postgraduate Centre.

4.6 There are, however, a number of key issues that are still believed to be of significant relevance to the University estate:

Pressure on the University core and the functionality of the Hugh Nisbet building

Potential shortage of space and the need for space utilisation surveys

Space reallocation between departments to reflect space need more closely

Shortage of refectory space

Significant remodelling of space, to improve space utilisation and functionality


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Number of rooms under central timetabling, booking and management will increase.

Estates Masterplan

4.7 A Masterplan for ten years and beyond for the University’s estate was prepared in 2000. The Masterplan set out a proposed layout for the growth of the University’s estate reflecting the University’s then proposed future strategy. The Masterplan reflected the following assumptions:

9,000 full time students studying at the Riccarton campus

Space identified for expansion to cope with 9,000 students and staff to operate the University

Research Park operating close to full capacity.

4.8 At an estate level specific issues identified within the Masterplan included:

Development of the South Campus on existing playing fields. Relocate playing fields on land south of the campus

Improved public transport links. Possible new links with Curriehill Road Station

New core relieves congestion in Hugh Nisbet building

Academic buildings usually 3-4 storeys, this is as a result of height restrictions at the campus due to the close proximity of Edinburgh Airport

Sports village and all weather pitch

Future North Campus area reserved for amalgamation with other educational institutions

Student villages to the west of the campus

Possible reduction in car park spaces, allowing academic development on library car park.

4.9 A copy of the Masterplan is included in Appendix 5.

Summary

4.10 It is clear that a number of the proposals and recommendations set out in the 1999 Estates Strategy and the Masterplan are still relevant to the development of this Estates Strategy. It does, however, set out a previous vision for the future strategy for the University and its estate.

4.11 With the completion of this Estates Strategy it is recommended that the Masterplan is refreshed and updated to represent and reflect the new vision for the University’s estate.

The Estate Vision 4.12 The estate vision for the University is to deliver an attractive, exciting,

vibrant and welcoming estate which fully supports and underpins the teaching, learning, research and student support strategies of the University within a sustainable environmental and financial framework and which compares favourably against peer institutions.


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Teaching and Research 4.13 The teaching environment across the University requires investment to

ensure it is capable of maximum flexibility and maximum space efficiency. There are generally two significant impediments to intensification of teaching room use; different room ownerships and different room standards. Many surveys have shown that teaching space “owned” by departments is significantly less well used that centrally managed teaching space. Also, different ownerships can contribute to differential standards of teaching spaces across the University. It is accepted that differential standards are required sometimes but what we are referring to here are unmanaged differentials. These different standards make introducing more flexibility and centralised room management more difficult.

4.14 The Estates Strategy should aim to deliver a situation where all generic teaching spaces are centrally managed and developed to the same standard except for deliberate exceptions. This should include the IT / AV environment in the teaching rooms.

4.15 The major factor constraining the development of research will be the availability of space for new staff. This applies to both research staff/ students and increasing numbers of support staff. The additional staff numbers targeted by the University will almost certainly result in a requirement for additional space and also significant space intensification through a re-modelling of existing space.

4.16 A further complication is that provision of additional space is unlikely to be possible or sensible through a series of extensions to existing buildings, so the pragmatic approach is development of new, essentially office space which will probably be shared across departments and administrative support functions. This is a cultural change to the current configuration and culture of the University.

4.17 The Estate Strategy should identify the space that research growth is going to require and deliver that space to an agreed configuration.

Learning and Student Experience 4.18 The lack of appropriate groupwork and learning space has been a key

issue in the stakeholder interviews undertaken as part of the Estates Strategy development. The preferred nature of these spaces varied from buzzy to studious, from social to business and from low tech to high tech indicating that a range of spaces is required. The model for provision of the spaces also varied from a large multi-zoned well serviced central space, to a series of department focussed spaces to a central space with departmental satellites.

4.19 Library space was seen as being “tired” and cramped. The focus of IT provision in library spaces has shifted since the 1999 Estates Strategy with the proliferation of pc provision and increased laptop ownership. The likelihood is that the required library provision will only be delivered through a new library building, probably incorporating some of the “learning zone” space identified above.

4.20 The Estates Strategy needs to ensure that:

Sufficient and appropriate library space is provided

A wide selection of learning / groupwork / study spaces is provided across the estate.


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Student Residences 4.21 The University has recently completed an exercise considering options for

the most appropriate manner for the future provision and operation of student accommodation. The preferred option identified is for the University to deliver new student accommodation at both the Riccarton and Scottish Borders Campus (SBC). The University will also retain responsibility for the ongoing operation of the student accommodation. At Riccarton the objective is for the new development to be in accordance with the Masterplan which will deliver a new student village at the west end of the campus and free up potential development space in the location of the older blocks in the centre of the campus. This will create a ‘residential zone’ at the Riccarton campus.

4.22 The Estates Strategy is therefore based on the provision of 600 new bed spaces and appropriate support facilities in a new student village to the west of the Riccarton campus. At the Scottish Borders Campus up to a maximum of 250 new bed spaces and appropriate support facilities are to be provided.

Environmental 4.23 Environment has become an increasingly important and now critical issue

since the 1999 Estate Strategy. Spiralling fuel bills in recent years, and indeed weeks, have put a new emphasis on the design of new buildings, the enhancement of existing buildings and the management regimes of buildings in use. Although the focus is currently on fuel prices, the use of other natural resources is also a significant issue. Water is becoming more expensive and the selection of new materials for construction projects is starting to take into account whole life energy issues including energy and carbon consumed in collecting and processing raw materials and components.

4.24 The University is already a prominent name in the field of environmentalism with aspirations to develop further. There is clearly an implied pressure to ensure that the University is seen to “practice what it preaches” in terms of the environment.

4.25 The Estates Strategy should ensure that good environmental practice is embedded in the delivery of all new projects. This should include consideration of a wide range of guidance, such as:

Sustainable Development Guidance for Estate Management published by the SFC

The new 2008 BREEAM ratings/ assessment guidance

Scottish Government environmental policies and guidance, such as the plans for a zero waste Scotland, including targets to increase recycling and reduce landfill.

4.26 As part of this the Estates Strategy should also ensure that resources are made available to develop and implement energy conservation and generation projects (based on a business case with payback) and systems to improve energy and water management (e.g. local metering to enable accurate use monitoring).

Service Delivery


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4.27 A hidden aspect in many estates strategies is the impact the strategy will have on the team directly responsible for managing and maintaining the estate. It is unrealistic to expect the estate to increase in size without increasing the resource available to look after it. It is also unrealistic to expect improved performance to target KPIs without the support of appropriate estate management information systems. Finally, it is unrealistic to expect a team that has been managing the current maintenance and modest capital programme to suddenly cope with an enhanced capital plan alongside new initiatives on sustainability, implementation of new systems and improving space management.

4.28 The Estates Strategy, has therefore reviewed and provided recommendations in respect of the University’s Department of Estates and Building Services team and the ability to deliver the strategy highlighting any risks involved.

Assumptions for Future Requirements 4.29 Having identified the Strategic Estate Objectives in Section 3, the next step

is to convert them into estate assumptions to enable the various options to be compared and appraised. The following table seeks to place ‘hard’ assumptions against each of the Strategic Estate Objectives which, it is important to remember, have been derived from the stakeholder consultation and extracted from other key University documents.

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Objective Assumptions Estate Requirement Cost

Deliver an estate of an appropriate size for the future development of the University

700 new staff, say 600 with offices over next 10 years @ 13 sq m per person gross = 7800 sq m

Assume refurbishment/remodelling can accommodate half the staff, but three times the area required to obtain space gains

3,900 sq m new building for staff offices

11,800 sq m of refurbishment to generate new space for 300 new staff within existing space (assuming space requires refurbishment anyway)

3,900 sq m @ £3,000 psm (new build) = £11.7M

11,800 sq m at £2,000 psm (refurbishment) = £23.6M


Alterations and improvements to lab based facilities rather than new build to support growing and modernising research profile

1,500 sq m of refurbished laboratory facilities within existing space

1,500 sq m @ £2,500 psm (specialist lab refurbishment) = £3.75M


Major investment required in new library facilities

Upgrade programme of existing teaching facilities required (assumes department ‘owned’ space as well as centrally managed)

Provision of groupwork / social / study

New library / learning resource building of 4,000 sq m

Refurbishment of vacated library building to provide large central groupwork / social / study space @

4,000 sq m @ £3,000 psm (new build) = £12.0M

1,550 sq m @ £2,000 psm refurb to provide study / social spaces = £3.1M

H E R I O T E S T A T E S S T R A T E G Y

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Objective Estate Requirement Cost

space required in key locations across the campus

500 sq m

Refurbishment of 20,000 sq m of teaching space teaching rooms to consistent standard

Provision of 4 satellite facilities @ 200 sq m each totals 800 sq m of refurbishment within existing spaces

20,000 sq m @ £2,000 per sq m (refurbishment) all teaching spaces = £40M

800 sq m @ £2,000 per sqm (refurbishment) = £1.6M


New ‘one stop shop’

New Student Association building / renovated Student Association building

Improved ‘Core’ of the University in Hugh Nisbet building

Provide in refurbished space within existing library

Provide in refurbished space within the existing library

Refurbishment of Hugh Nisbet building to improve

1,000 sq m @ £2,000 psm = £2M

Total cost (as per Capital Plan) £5.7M



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Objective EAssumptions state Requirement Cost

functionality


Provision of new student residences and associated facilities to replace existing tired accommodation and relocate residences to student village at Riccarton

Provision of new student residences at SBC campus

Delivery of 600 new residence spaces and associated facilities at Riccarton

Delivery of up to 250 new residence spaces and associated facilities at SBC

Total cost (as per Capital Plan) £35M



Provide new residential accommodation for the conference facilities through refurbishment of Leonard Horner Hall

Delivery of refurbished 200 bedroom hotel type accommodation



Deliver a programme of energy and water saving measures

Ensure strong focus on ecological issues on campus

Develop stronger ownership and management of utilities issues through devolved metering and

Effectively, short to medium term funding is required for projects which should be self-funding over time.

Say £750,000 per annum for 5 years then £500,000 per annum thereafter


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Objective E Assumptions state Requirement Cost

charging


Refresh Masterplan to consider potential spaces for the campus, and also to consider how refurbishments may be combined with re-cladding (for appearance and energy efficiency) by developing a palette of materials for new projects

Generally allow sufficient funds for projects to ensure that any selected new building or refurbishment significantly adds to the campus environment

Revisit and refresh Masterplan to reflect outcomes of Estates Strategy and theme team discussions

Allow a “marketing enhancement” to those projects selected as potential major contributors to the estate

£100,000 fee estimate

Allowance to be determined by the University


Establish good practice space management to maximise use of existing built estate and efficiency of new build

Assumptions above reflect good space management practice so if this is not done, areas and costs are likely to increase

No capital cost. Significant management time and effort


University will want to ensure risk of failure to meet statutory requirements is minimised.

Current spending seems very low. Additional floor area will require increased

1994 Group annual average spend per square metre is £30.57. This equates


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Objective E quirement Assumptions Cost

University will desire protection of investment in new facilities and refurbishments through ongoing maintenance

University will want to ensure their KPIs around maintenance keep them on a par with the 1994 peer group selected

spend. to a total of £4.8M per annum for the University 1

1 Based on approximately 160,000 square metres of floorspace.



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5. Review of Existing Estate Introduction

5.1 In this section we have set out an assessment of the University’s existing estate. Accurate information about an estate is a pre-requisite in the development of a successful estates strategy. The assessment of the existing estate has been developed in accordance with the checklist included with the SFC guidance.

5.2 This section focuses primarily on the University’s Riccarton campus, but also includes details of the other campuses which the University currently operates out of where appropriate.

Background and Campuses 5.3 The University currently operates out of four principal locations which are

as follows:

Stromness, Orkney

Dubai Academic City, Dubai

Scottish Borders Campus, Galashiels

Riccarton, Edinburgh.

5.4 We have set out a brief overview and review of the Orkney, Dubai and Galashiels campuses below. As outlined above, a more detailed analysis of the Riccarton campus is set out within the remainder of this section.

Stromness, Orkney 5.5 The University’s accommodation at Stromness, Orkney comprises the Old

Academy including the Water Test facility. The Old Academy facility is approximately 2,868 square metres and provides office and laboratory space and is home to the International Centre for Island Technology (ICIT) which is part of the University’s Institute of Petroleum Engineering. ICIT was established to carry out advanced research, postgraduate training and consultancy in marine resource management and related issues..

5.6 The Old Academy is leased by the University from Orkney Council. The University works in close partnership and receives considerable funding and research from Orkney Council in relation to this site.

5.7 The University considers that the existing facilities for the ICIT are fit for purpose and that any opportunities for improving and/or additions to the range of facilities will be through partnership with the local Council. On this basis no change is proposed for the University’s accommodation in Orkney for the purpose of the Estates Strategy.

Dubai Academic City, Dubai 5.8 The University’s Dubai campus is a modern purpose built facility of

approximately 3,700 square metres in Dubai Academic City. The campus opened in March 2006. The campus offers a range of undergraduate and postgraduate courses which reflect the University's Scottish Schools and Institutes as well as student exchanges and campus transfers. The facilities include a well equipped library, IT and audio-visual facilities together with student accommodation.


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5.9 The University’s partner service provider holds the lease for the accommodation at the Dubai campus and it is believed to currently meet requirements. Currently no changes are envisaged at the Dubai campus, but this situation could change should the student numbers dictate a requirement for additional space. Should this need arise it would then be addressed by the partner service provider on the same basis as the current arrangement i.e. a shared split of both the costs and the benefits.

Scottish Borders Campus, Galashiels 5.10 The Scottish Borders Campus (SBC) is located at the eastern edge of

Galashiels. The SBC is home to the School of Textiles and Design and also runs a number of courses from the School of Management and Languages. The accommodation at the SBC includes integrated learning facilities, computer suites (including CAD/CAM studios) specialised workshops, spacious studios for weave, knit, print and apparel, library, careers service, student support service including residential accommodation and a display gallery.

5.11 The SBC consists of three main sites, which are all directly adjacent to each other as shown in the location and site included in Appendix 6. The main campus buildings are located on a 5.43 acre site and were originally constructed in 1964 with various extensions undertaken during the 1970’s. The campus buildings are currently being redeveloped as part of a £31.4 million modernisation project. The modernisation works are due to be completed by Easter 2009. The University’s Estates and Building Services team are currently involved in monitoring these works.

5.12 Located adjacent to the main campus buildings is a site which extends to 1.0728 acres and contains the High Mill building. This was acquired by the University in 1994. The High Mill was constructed in the late nineteenth century, and consists of a four storey building extending to approximately 1,086 square metres. The High Mill has recently been extensively refurbished and provides a range of academic and practical teaching space together with office space for the Schools of Textiles and Design. A further £500,000 is due to be spent on the High Mill building during 2008/09 for works required to the roof of the building.

5.13 To the south of the main campus is the third site which extends to approximately 7.42 acres and contains the University’s residences, self catering student accommodation, some staff accommodation and the students union pavilion. These buildings extend to approximately 3,293 square metres providing approximately 200 student bedrooms. The residential accommodation was built in the 1970’s and is in relatively poor condition.

5.14 The SBC is part of the collaboration and co-location project between the University and the Borders College. Following completion of the modernisation programme the University will occupy part and share accommodation with Borders College within the main campus buildings on the basis of rent free occupation for 17.5 years. Borders College will be responsible for the delivery of facilities management services to the main campus. A co-location agreement between the University and the college has been agreed in principle.

5.15 As part of this arrangement only the High Mill building and the student residential accommodation shall remain directly within the ownership and control of the University.


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5.16 The co-location and collaboration projects is currently part of a research study by the SFC into best practice within the Higher/ Further Education sector in Scotland.

5.17 For the purposes of the Estates Strategy it is deemed that the University’s principal focus in respect of the SBC is regarding the future provision of residential accommodation.

Riccarton, Edinburgh Background and Overview

5.18 The University’s principal campus is at Riccarton, Edinburgh. The Riccarton campus is located on the outskirts of the village of Currie and approximately 5½ miles from Edinburgh city centre and some two miles to the south of Edinburgh Airport. The campus is located in close proximity to the Edinburgh City by-pass and the main access is off the A71 Calder Road. Location and site plans are included in Appendix 7.

5.19 The entire Riccarton campus extends to approximately 364 acres, which can be broken down into three principal areas which are as follows:

Main Campus – 218 acres

Research Park – 61.5 acres

Undeveloped North West Fields – 84 acres.

5.20 Within the main campus area it is possible to break the campus into a number of distinct zones. These are as follows:

University Core - this houses the main administration and support space of the University. This includes the James Watt Centre, Hugh Nisbet Building and the Lord Balerno Building

Science and Technology – this is located to the north of the University Core and includes the principal buildings of the Schools of Engineering & Physical Sciences, Mathematics and Computer Sciences, Life Sciences and the Built Environment. This also includes the Institute of Petroleum Engineering located to the east and adjacent to the Research Park South

Business, Social Science and Library – this is located to the south of the University Core and includes the Edinburgh Business School and buildings occupied by the School of Management & Languages. The existing library is also in close proximity

Sports facilities – this is also located to the south of the University Core and includes the Centre for Sport and Exercise, the Sports Academy and the University’s playing fields

Student Residences – these are currently located in two distinct zones, the older Residences to the East of the University Core and the Student Village to the west of the campus

Miscellaneous buildings – this includes the Estates Office, Nursery, Procurement Services and Media Services and are located to the north east of the University Core.


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5.21 Since the completion of the University’s previous Estates Strategy in 1999, a number of additional developments have been completed across the estate. Principally this includes:

Maclaurin building (Mathematics and Actuarial Mathematics)

Sports Academy

Energy Academy ERT

Edinburgh Business School kitchen extension

Postgraduate Centre – due to be completed in autumn 2008.

5.22 The University has recently had a bid accepted by the City of Edinburgh Council for Panmure House in Edinburgh’s Old Town. Panmure House is a former home of Adam Smith the ‘father of economics’. The University intends to use the facility as a centre for international economics.

Area

Overall Site

5.23 The University’s Riccarton campus extends to approximately 364 acres. This is split into three principal elements which are as follows:

Gross (acres) Net Developable (acres)

Main campus (occupied space)

Buildings, roads and car parks

Woodlands, Gardens and Loch

Playing fields

Undeveloped space

218

91

24.3

13.4

13.8

Research Park

Woodland perimeter

South

North

Phase 1a

Undeveloped space

61.5

7

7.3

7.3

6.1

1.4

Undeveloped North West Fields

North West Fields

Woodland perimeter

84

76

8

Building Floorspace

5.24 The table below sets out details of the existing building floorspace across the Riccarton campus. This has been broken into a number of categories which are as follows as classified in the Dearle & Henderson survey:


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Space Type GIA (sq m)Academic / Schools 85,843Admin/ Support Services 25,465

wellings 281Infrastructure Buildings 470Residences & Flats 46,470Student/Staff Recreation/ Support 4,107Total 162,636

D

Space Type by Floorspace

52%

16%

0%0%

29%

3%

Academic / Schools

Admin/ Support Services

Dwellings

Infrastructure Buildings

Residences & Flats

Student/Staff Recreat ion/Support

Academic/ Schools – this includes all of the academic space within the campus including all of the various departmental Schools accommodation

es Watt Centre, Estates office, etc

d are

Source: Dearle & Henderson: Estate Condition & Statutory Compliance Survey

Tenure

e University. There are a number of restrictions within the title report for the site and an extract

the title report is included in Appendix 8. Details of the restrictions

Admin/ Support Services – this includes all of the support space of the University such as the Hugh Nisbet and Lord Balerno buildings, George Heriot Wing, Jam

Dwellings – this includes the East, North and West Lodges which are located around the perimeter of the campus. These are lodge houses associated with the original Gibson-Craig estate ancurrently occupied by landscape staff from the Estates and Building Services team

Infrastructure Buildings – this includes areas covered by substations and other items of infrastructure within the campus

Residences/Staff Recreation/Support – this includes all of the student residences, student union, chaplaincy and medical/health centre.

5.25 The Riccarton campus is held on a freehold basis by th

plan fromare set out below.

Research Park Phase III


S E P T E M B E R 2 0 0 8 3 9

5.26 This is the area coloured blue on the extract plan, lying to the south of the A71. For this area the University entered into a Section 50 Agreement with

s area. Under this agreement, any buildings shall

Used for the production of items for sale on a commercial basis.

7

ines of coal are vested in British Coal

o definition is given in the Title

offering the land to Edinburgh City Council. Should the

5.28 d, as shown in purple in the extract plan. Restrictions

9 respect of oundary of

uld however, be altered.

from Edinburgh city centre in 1992. Whilst a rtion of the estate was built in the 1970’s there has been

mme of developments up to the present day.

the District Council for thinot be:

Occupied other than by institutions or companies who carry out industrial, technological, scientific work or by academic institutions

Western part of the campus

5.2 This is the area coloured orange on the extract plan, which extends to some 50.52 acres. Restrictions include:

All rights to coal and m

The land can only be used for the purposes of a University as defined by Edinburgh City Council (ndeeds)

There is a right of pre-emption in the Title preventing the University from selling or disposing of any land or buildings to a third party without University sell to a third party, the value of the land (calculated as specified by the pre-emption agreement) must be repaid to the Council.

Eastern part of the campus

This relates to an area of 0.819 acres lying to the east of the former Riccarton Mains Roainclude:

The University erecting any buildings on the site

All rights to coal and mineral are vested in British Coal.

Northern Boundary

5.2 There is a compulsory order by the City of Edinburgh Council inthe area shown as black on the extract plan at the north west bthe site. This area co

Burial Ground

5.30 A way-leave right of access exists to the burial ground which is located to the west of the campus.

Building Age

5.31 The Riccarton campus was initially established in the early 1970’s with the University fully relocatingsignificant propoan ongoing progra

5.32 In the table below we have summarised the building floor space at the Riccarton campus in respect of the date of occupation:


S E P T E M B E R 2 0 0 8 4 0

Date of occupation Sq m %1970's 56,344 35%1980's 28,899 18%1990's 64,246 40%2000 onwards 9,716 6%Total 159,204 100%

Ca mpus bui l di ngs by da t e of oc c upa t i on

35%

18%

41%

6%

1970's

1980's

1990's

2000 onwar ds

Source: Dearle & Henderson: Estate Condition & Statutory Compliance

5.33 A full list of the dates of building occupation across the Riccarton campus is included in Appendix 9.

5.34 As the table above shows the majority of the development of the University

opment associated with the establishment of the

esidences I and II, the Cameron Smail lding which was the basis of the original ed for a capacity of 3,500 students.

er building

liance

liance Survey

campus in terms of floorspace has taken place in two main phases, namely an initial phase of develRiccarton campus in the 1970’s and a subsequent phase of development primarily during the early 1990’s.

5.35 The 1970’s buildings includes a number of the academic buildings located to the north of the campus in the Science and Technology Zone including:

Naysmyth building

William Arrol building

William Perkin building.

5.36 The 1970’s buildings also includes Rlibrary and the Hugh Nisbet buiUniversity core. This was design

5.37 During the early 1990’s principal addition to the estate in terms of building floorspace included:

Earl Mountbatten building

David Brewst

James Watt Centre.

Condition and Legislative Comp

Estate Condition & Statutory Comp

HE

E R I O T - W A T T U N I V E R S I T Y S T A T E S S T R A T E G Y 2 0 0 8

S E P T E M B E R 2 0 0 8 4 1

5.38 le & Henderson to undertake a iccarton campus.

ucture

the

Scottish Building Regulations and also provide and install at agreed

uilding

osted and integrated into the work undertaken by Dearle &

& Henderson report identified that the main building state that formed the original core of the estate at

g from the 1970’s are now nearing the end of their economic

In 2007 the University commissioned DearCondition and Statutory Compliance survey at the R

5.39 The survey included all residential, non residential, service infrastructure buildings and associated external areas, in respect of the following:

a) Establish where its condition fails to comply with current legislation

b) Determine the overall condition of the fabric and services infrastr

c) Determine the DDA Access requirements for external access to buildings and also internal access within the buildings

d) Determine the current Energy Performance of Buildings in relation to the EU Energy Performance of Buildings Directive (EPBD) and the

locations framed certificates in the various public buildings over 50 square metres in respect of floor area

e) Determine the cost of identified cost of identified costs for items a) to d) on a cost per square metre basis per b

f) Determine the costs of replacing the particular property in its current configuration.

5.40 For items e) and f) reference was made to the AUDE Study Group Guidance.

5.41 The findings of recent Type 2 Asbestos Surveys and Fire Safety Management Audit Surveys previously undertaken by the University were reviewed, cHenderson. The survey was conducted on the basis of a visual inspection both internally and externally, no invasive investigations were carried out and the services were not tested.

5.42 A full list of the buildings surveyed by Dearle & Henderson is set out in Appendix 10.

Key findings

5.43 The Dearle components of the eRiccarton datinlife span. In addition recent changes in legislation have imposed greater duties and responsibilities on management to ensure that properties under their control meet current compliance legislation.

5.44 The table below summaries the proposed cost of works identified by the Dearle & Henderson survey across the Riccarton estate:

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S E P T E M B E R 2 0 0 8 4 2

5.50 Set out below are a list of some of the larger buildings within the campus where the total repair cost was over 65% of the insurance replacement value raising issues about options for their future:

5.49 The analysis of the total repair cost per square metre against the insurance replacement value undertaken by Dearle & Henderson for each of the buildings within the campus is included in Appendix 12.

5.48 Within the Dearle & Henderson survey analysis has been undertaken of a calculation of the costs of repairs per unit area compared to the cost of rebuilding or replacement of a building based on the insurance replacement value. This is in accordance with the AUDE Study Group Guidance. Assessment of this analysis allows for a more detailed assessment of whether each building should be considered for repair, rebuild or subject to a full option appraisal when considered with other factors such as functional suitability.

5.47 The majority of the identified condition costs relate specifically to the Naysmyth, Hugh Nisbet and Earl Mountbatten buildings together with some of the original residential blocks namely Ettrick, Caddon,Linlithgow, Midlothian and Pentland. Significant costs were also attributed in respect of mechanical and electrical services in the Cameron Smail Library and Earl Mountbatten building. A detailed breakdown of the condition costs on a building by building basis is included in Appendix 11.

5.46 The compliance works identified are by their very nature works that require immediate consideration and is of critical importance in respect of fire safety works. Whilst DDA works have been included under compliance, these works may not necessarily be prescriptive in nature and should be considered as being of a reasonable nature as part of a range of other factors.

5.45 It should be noted that these are net figures which exclude additional costs such as contingency, preliminaries, professional fees, VAT and temporary accommodation.

T y p e o f W o r k s C o s t ( £ )C o m p li a n c e F ir e s a f e t y 4 , 0 0 0 , 0 0 0A s b e s t o s 1 8 3 , 0 0 0D D A 7 , 0 0 0 , 0 0 0G e n e r a l H e a l t h a n d S a f e t y 3 5 , 4 7 7T o ta l - C o m p l i a n c e 1 1 , 2 1 8 , 4 7 7C o n d i t i o n R o o m s 3 1 , 5 0 0 , 0 0 0M e c h a n ic a l S e rv i c e s 1 7 , 0 0 0 , 0 0 0W a ll s 1 3 , 4 0 0 , 0 0 0E x t e rn a l G r o u n d s 1 3 , 5 0 0 , 0 0 0E le c t r ic a l S e r v ic e s 6 , 8 0 0 , 0 0 0R o o f s 6 , 0 0 0 , 0 0 0F ix t u r e s & F it t in g s 5 , 2 0 0 , 0 0 0T o ta l - C o n d it i o n 9 3 , 4 0 0 , 0 0 0O v e r a ll T o t a l 1 0 4 , 6 1 8 , 4 7 7

Residences I, II, V, VI and Paul Stobart building.

Earl Mountbatten building

Coulson building

Cameron Smail library


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S E P T E M B E R 2 0 0 8 4 3

Recommended levels of maintenance expenditure

5.51 A report by JM Consulting in 2006 Future needs for capital funding in higher education suggested that in order to sustain an estate (allowing for ongoing development of the estate and preventing increasing levels of maintenance backlog) institutions should be investing an annual amount equivalent to 4.5% of their insurance replacement value.

5.52 Whilst the 4.5% figure was an average and that the actual levels required will depend on an institutions actual situation it does provide an indicator and was used as a basis of assessment within the Audit Scotland report Estate management in higher education which was published in 2007. The Audit Scotland report identified that across the period 2004/05 and 2005/06 that estate expenditure at the University was below the annual ‘required levels’ on the basis of the 4.5% and that the current planned spending is unlikely to affect accumulated backlog maintenance or allow significant estate development.

10 Year Planned Maintenance Programme

5.53 To address the maintenance backlog the University commissioned Dearle & Henderson to develop a 10 year Estate Planned Maintenance programme. This report drew on the findings identified in the earlier Condition and Statutory Compliance survey undertaken by Dearle & Henderson.

5.54 The 10 year programme prioritised the works in the following order:

Compliance including Fire Safety, Hazaradous materials and Health & Safety

Compliance DDA including external routes

External fabric and M&E services

Internal fabric.

5.55 The 10 year programme identified a prioritised set of capital works across the campus amounting to £12,916,543.96. This does, however, include an allowance of £500,000 regarding a replacement roof got the High Mill at the SBC. These figures excluded the works identified for replacement across the 10 years which amounts to a further £23,884,279. A full breakdown of the figures across the groups of buildings within the campus is included in Appendix 13.

5.56 Dearle & Henderson then compared the cost of these work against two proposed budget options. These were as follows:

Option 1 was an annual budget of £1,000,000 over the 10 years

Option 2 was an annual budget of £2,000,000 over the 10 years.

5.57 Under Option 1, it was identified that due to that all the works required in years 1 and 2 will subsume the available budget for the first 5 years. The works required in years 1-5 would also subsume the entire budget. At the end of the 10 year period the University would be faced with an additional backlog maintenance of £3 million to the predicted £24 million outlined above.

5.58 The increased annual budget in Option 2, would allow for all the works identified to be completed up to and including year 6. From year 7 onwards

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S E P T E M B E R 2 0 0 8 4 4

an available £7 million could be generated to reduce the predicted backlog maintenance to approximately £7 million.

5.59 Dearle & Henderson made a clear recommendation within the report for Option 2, as it addressed all prioritised works including immediate compliance issues within 6 years together with the opportunity to reduce the overall backlog. This was, however, subject to adequate staff resourcing to implement this option.

Space Management/ Utilisation

5.60 At present the management of teaching and learning space at the Riccarton campus is split between:

Centrally bookable teaching rooms – managed by the Registry department

Teaching space within the Academic Schools – managed by the Academic Schools.

5.61 In terms of overall percentages, approximately 30% of the rooms are Centrally bookable with the remaining 70% being managed by Academic Departments and others.

5.62 This existing structure makes it difficult for the University to accurately measure existing space utilisation across the Riccarton campus. As a result the University does not currently carry out annual space utilisation surveys.

5.63 The EMS dataset does, however, allow an assessments of space utilisation. On the basis of EMS datasets in 2006/07 the following space utilisation benchmark was identified:

Total non residential NIA/ per student FTE: 13.35 square metres.

5.64 This is significantly above the mean of 10.94 square metres per student FTE for other ‘1994 Group’ campus based universities within the 2006/07 EMS dataset. Whilst this would seem to indicate that there is the potential for sufficient space savings, it will be vital to fully understand the characteristics of existing space use across the University before any target can be set.

5.65 The UK Higher Education Space Management Group (SMG) has been set up to assist higher education institutions to identify and implement best practice in the management of space. The latest publication by the Space Management Group was ‘Implementing SMG Guidance’ which was published in October 2007. The guidance is aimed at assisting Higher Education institutions to take forward and put into practice advice and tools developed by the SMG.

5.66 The guidance emphasises that space management should not be viewed solely as an ‘estates’ issue. And that it needs to be carefully integrated with institutions’ strategic and financial planning. Strong leadership and organisation, combined with good, up-to-date information on estate performance, underpin successful space management.

5.67 Within the guidance there is a space management checklist setting out a range of factors that an institution should consider as part of its space management policies. An assessment has been of the University existing practices against this checklist and is included in Appendix 14.

5.68 It is clear from the completion of the checklist that the University is failing to currently meet the majority of the criteria within the checklist in respect of


S E P T E M B E R 2 0 0 8 4 5

space management guidance. It is recommended that the University should establish a ‘space management project’ in accordance with the principles set out in the SMG guidance.

Use/ Functional Suitability/ Fitness for Purpose

5.69 The University is aware of the ongoing changes in teaching and learning strategies within higher education. This has a direct impact on the size, type, internal configuration and layout and equipment required within space across the University.

5.70 In accordance with the SFC guidance, the University has undertaken a detailed assessment of the principal use and functional suitability of its academic and support space across the Riccarton campus. The assessment has been based on the following criteria:

Effectiveness for use

Space utilisation

Use mix efficiency

Quality suitability

Internal circulation

Occupancy costs

Amenities and facilities

Environment adequacy

Building character.

5.71 Each building was then scored against these criteria using the EMS grading criteria, set out below and a total and average score recorded.

Grade 1 – Excellent

Grade 2 – Good

Grade 3 – Fair

Grade 4 – Poor.

5.72 In the table below we have summarised the key findings of the functional suitability/ fitness for purpose assessment. This has summarised the average scores for the buildings and identified a set of bandings based on the EMS criteria. A detailed breakdown of the scores for each of the buildings is set out in Appendix 15.

Assessment Score Number of buildings %

Excellent/Good 10 - 20 3 6%Good/Fair 21 - 30 29 57%

Fair/Poor 31 - 40 19 37%

51 100%Total

5.73 As the table above highlights there are significant functional suitability issues across the estate. With the exception of only three buildings, there would appear to be sigificant functional suitability issues regarding the


S E P T E M B E R 2 0 0 8 4 6

remainder of the campus buildings assessed. Whilst it is inevitable that there will be functional suitability issues due to the changing nature of education provision against the original design, it is clear that there has been a lack of investment to address these issues across the campus.

5.74 Of particular concern are the nineteen buildings which have been assessed as ‘fair/poor’ where the score achieved demonstrates serious issues with the existing functional suitability. These buildings include:

Cameron Smail Library

John Muir building

William Arrol building

William Perking building

David Brewster building

Residences I and II.

5.75 Typically these are some of the original buildings constructed in the 1970’s, but this also includes a number which date from the late 1980’s/ early 1990’s. For the Cameron Smail Library and Residences I and II, the poor fitness for purpose issues together with the significant condition issues previously identified would seem to indicate that replacement may be a more appropriate solution than refurbishment and remodelling.

5.76 It is clear that significant targeted investment is required by the University to address functional suitability issues across the Riccarton campus.

Running Costs

5.77 At present the University does not have an Estates Information Management System (EIMS) for its estate. As a result it is not possible to identify accurate running costs on a building by building basis across the Riccarton campus.

5.78 Whilst the University is in the process of investigating, in conjunction with the Carbon Trust, rolling out a programme of energy meters across each of the buildings this will take time to be completed. In the interim the University has established and adopted a process for re-charging Schools/Sections for the cost of utilities (both energy and water) used.

5.79 The principal running costs for the University in 2006/07 as identified in from the EMS dataset and is set out in the table below together with the median running costs of the 1994 Group campus universities over the same period:

Heriot Watt University 1994 Campus based University'sMaintenance (GIA) 18.24 28.05Energy (GIA) 13.68 12.67Water/Sewerage (GIA) 3.39 2.27Facilities Costs (NIA) 20.00 23.00Property Management (NIA) 2.88 11.14Total 58.19 77.13

£ (per squre metre)Running Costs

Source: EMS

Note - Facilities Costs includes Cleaning, Porterage, Security and Post Room costs


S E P T E M B E R 2 0 0 8 4 7

5.80 From comparing the 1994 Group comparators against the University it is clear that there is a significant difference in maintenance spend, which was highlighted previously. The principal area of difference in the maintenance spend is that there is no spend on planned maintenance within the University’s figures, against an average of £9.28 per square metre by the 1994 Group.

5.81 The other principal area of difference in the costs is in respect of property management, where the University’s costs are significantly below those of the comparator group. This is discussed in more detail within the Service Delivery section below.

Increased utilities costs

5.82 Since the production of these figures these has been a further sharp price spike in the cost of utilities. The University is part of a consortium of organisations who bulk purchase utilities and a new two year contract for gas and electricity has recently been agreed. For gas and electricity the prices reflect an increase of 107% and 40% respectively over the last 2 years.

5.83 The increased cost of utilities is likely to continue over the period of the Estates Strategy. This will obviously increase the overall running costs of the University’s estate and is a critical factor as part of its ongoing management. This further reinforces the requirement for the University to develop a more efficient use of space across its estate.

Benefits of an EIMS system

5.84 It is very unusual for an organisation with a large estate such as the University not to have an EIMS system in place. The collection of accurate EMS data such as estates running costs and performance data was recommended by the Audit Scotland report ‘Estate Management in higher education’ in 2007.

5.85 A business case has been developed by the University’s Department of Estates and Building Services for an EIMS system and we understand that has been approved in principle. It is anticipated that the time involved in the procurement, data collection and initial implementation of the system will be approximately two years.

5.86 For a relatively small initial capital outlay an EIMS system will have a number of significant benefits for the management of the University estate. This includes:

Helpdesk and incident reporting

Space management

Maintenance

Compliance and Health & Safety

Reporting and KPI’s

Budget management.

5.87 It will be vital that during the set up and implementation phase of any EIMS system that the University is able to resource the information gathering, validation and input into the system to ensure that it provides accurate information of the estate. There will also be an ongoing resource


S E P T E M B E R 2 0 0 8 4 8

requirements to ensure that the data within the system is kept up to date and accurate.

5.88 It is recommended that the University commences the procurement phase for an EIMS.

Valuation

5.89 The University last commissioned an Asset Valuation and Fire Insurance Valuation in July 2003. The valuations covered both the Riccarton and Galashiels campuses. The total Asset Valuation was £203,793,871, which consisted of a valuation of £182,994,000 for Riccarton and £20,799,871 for the Galashiels campus.

5.90 The Fire Insurance Valuation total was £193,139,800, which consisted of £168,745,150 at Riccarton and £23,394,650 at Galashiels.

5.91 The above valuation obviously do no take account of changes to the University’s estate since 2003. In particular, the change in tenure arrangements at the Galashiels campus outlined previously will have a significant impact on the value of the University’s holdings at this campus.

5.92 It is recommended that the University should consider options for updating the Asset Valuation and Fire Insurance Valuation in light of the recommendations set out within this Estates Strategy.

Environmental

5.93 The importance and understanding of environmental issues has increased greatly since the production of the 1999 Estates Strategy. As outlined previously faced with rising energy costs and the significant importance of sustainability issues this is a critical issue to be addressed across the University’s estate.

5.94 Below we have summarised the key aspects regarding environmental issues across the University.

Environmental Policy

5.95 The University is in the process of developing an overall Sustainability Policy together with an Environmental Management System (EMS). This is of particular importance given the nature of two of the academic theme teams (Energy and Environment and Climate) and the University must be able to show that it ‘practises what it preaches’.

5.96 At an estates level it is important that the Sustainability Policy and EMS are consistent with the recently published Sustainable Development Guidance for Estate Management by the SFC. They should also take account of other areas of guidance and good practice such as the 2008 BREEAM ratings/ assessments and the intention for a zero waste Scotland as outlined by the Scottish Government in early 2008.

Existing usage/ Carbon Management Programme

5.97 In 2006 NIFES Consulting on behalf of the Carbon Trust carried out a general review of the use and management of energy throughout the Riccarton campus site. Part of the remit was to highlight the most important opportunities to save both carbon dioxide and money.

5.98 The review identified that for a university with a 78%/22% mix of Academic/Residential buildings the target annual energy performance is 77 kWh/m2 for electricity and 197 kWh/m2 for gas. Actual performance of the University was assessed as 142 kWh/m2 and 219 kWh/m2 respectively,


S E P T E M B E R 2 0 0 8 4 9

both above the targets and almost double in the case of electricity. Up to 10% of the electricity consumption was believed to be attributable to the Research Park, but this accounts for only a small part of the apparent excess use.

5.99 The review also identified that there has been limited direct investment in schemes specifically for energy efficiency, and no formal policy as such to provide a clear strategy for the University. Faced with ongoing rising energy costs, it is clear that the University requires to give energy a higher profile and requires to develop closer monitoring and control measures regarding energy usage.

5.100 As part of addressing this issue, in 2008 the University has signed up for the Public Sector Carbon Management Programme. The Public Sector Carbon Management Programme is a recognised standard within the public sector and other universities, local authorities and NHS Trust have signed up to the programme.

5.101 The programme consists of an eleven month assessment that will allow for the University to develop an accurate assessment of its existing carbon footprint. It will also provide the

Understanding of your current energy usage and emissions

Firm, stretching targets for carbon and energy reduction

Prioritisation of opportunities for improvement.

5.102 The programme is due to be completed in early 2009 and clearly the results of the programme will require to be factored into the University’s Sustainability Policy and Environmental Management System.

Energy Performance Certificates

5.103 Part of the remit of the Dearle & Henderson survey included determining the energy performance of buildings across the estate in relation to the EU Energy Performance of Buildings Directive (EPBD) and The Scottish Building Regulations. Part of the requirement of the EPBD is the provision of Energy Performance Certificates within buildings, with frequently visited buildings providing public services required to prominently display the energy certificates. This allows for energy consumption levels to be much more visible to owners and users. These require to be displayed within public buildings by 4 January 2009.

5.104 This resulted in 57 buildings being assessed as part of the energy audit with a grading applied against a scale ranging from A – G, with A reflecting ‘very energy efficient’ and G reflecting ‘not energy efficient’. The results of the energy performance assessment are shown below:

E n e r g y P e r f o r m a n c e B a n d i n g s P e r c e n t a g e A 0 %B 1 1 %C 1 1 %D 1 3 %E 1 6 %F 5 %G 4 5 %T o t a l 1 0 0 . 0 %


S E P T E M B E R 2 0 0 8 5 0

Energy Performance Ratings

0% 11%

11%

13%

16%5%

44%

A

B

C

D

E

F

G


5.105 The results show that clearly that the original 1970’s properties have poor ratings (G on the scale). These buildings are poorly insulated/ constructed combined with the particular geometry and patterns of use make them particularly energy inefficient. The newer properties on the campus tend to be rated with B – D. Dearle & Henderson noted that all of the properties within the campus have large scale scope for improvement in terms of energy use and CO² production.

Planning

5.106 As outlined in Section 4, the Masterplan for ten years and beyond for the University’s estate was prepared in 2000 and is included in Appendix 5. The Masterplan reflected the University’s then strategy and the proposed future development of the campus.

5.107 A number of the proposals within the Masterplan are still relevant to the University’s planned strategy under Focus for the Future. It is, however, it is recommended that the Masterplan is refreshed and updated to reflect the University’s new strategic direction.

5.108 The Masterplan should set out in broad terms the main areas of proposed development and redevelopment over the next 10 years and beyond. It should also take account of the wider planning context, provided by planning officials from the City of Edinburgh Council and set a context for University planning applications.

5.109 The Masterplan should be flexible and can be updated as required to reflect any changes to the proposals. Key to this process will be engagement between the University and the City of Edinburgh Council planning officials, which will lead to a much better understanding of mutual objectives and risks and difficulties that require to be addressed on both sides.

Service delivery

Existing structure

5.110 The University’s Estates and Building Services Department is responsible for the provision of all estate related matters across the campus. This wide ranging remit includes the following activities:


S E P T E M B E R 2 0 0 8 5 1

Capital Developments – planning, buildings, landscape, roads, car parks, engineering services, infrastructure, SRIF and LTiF funded schemes

Maintenance - buildings, landscape, roads, car parks, engineering services, infrastructure etc, both planned and reactive

Small works – alterations, extensions, refurbishment, etc

Utilities – management and procurement

Energy – management of major plant and control and use of energy

Environment – management of sustainability, travel planning, waste and recycling activities

Landscape – management of campus landscape and associated biodiversity

Administration and Estate Management – disaster recovery planning, estates drawings and technical information, space management, space audits, leases, rates, etc

Central Support Services – security, traffic management, waste disposal mail services, transport, etc

Research Park Management – marketing, development, leases, maintenance, etc

Health and Safety and Risk Management – preparing policies, advising, auditing, insurances, etc.

5.111 As the list above illustrates, the Estates and Building Services Department includes staff responsible for the ongoing the management and planning of the estate and also staff involved in actual service delivery such as security and landscape maintenance.

5.112 A diagram of the organisational structure of the Estates and Buildings Services department staff is included in Appendix 16. This has been sourced from the Estate Office Annual Report 2006/07.

Comparison against other intuitions

5.113 A comparison of the existing staff resource within the Estates and Building Services department at the University would seem very low when compared to the 1994 Group campus based universities. The average cost per square metre within the 2006/07 EMS dataset for ‘1994 Group campus based universities’ is £11.14 per square metre, which is almost three times higher than the University figure of £2.88 per square metre.

5.114 The Audit Scotland report Estate management in higher education identified that on a FTE basis the University’s Estates and Building Services department had 7 FTE property management staff and that property management staff as a percentage of all FTE staff (non-residential) was 0.48%. When this is compared to a similar institutions this looks very low in terms of the staff resources. For example:

The University of St Andrews which is roughly the same size in overall square metres, has 18.5 FTE staff and 1.13% in terms of property management staff as a percentage of FTE staff


S E P T E M B E R 2 0 0 8 5 2

Stirling University, which is smaller in terms of overall square metres campus based university, has 23.8 FTE staff and 1.59% in terms of property management staff as a percentage of FTE staff.

5.115 Whilst it is always important to ensure that any such analysis is ensuring an accurate comparison of the same measures, it is clear that there the Estates and Building Services department is operating with a much smaller resource than other comparable institutions. It would appear that at present all resource is currently over stretched in simply ensuring that the estate continues to function on a day to day basis.

5.116 Given the existing lack of resource and that the Estates Strategy will identify a number of recommendations to be taken forward for the future of the estate the situation is likely to further exacerbate the pressure on the existing staff resources. Lack of appropriate resource may therefore have a serious impact on the ability to deliver the Estates Strategy.

5.117 It is therefore recommended that a detailed review of the structure, resources and existing roles and responsibilities within the Estates and Building Services department is undertaken to reflect the requirements of the Estates Strategy.

Summary 5.118 The analysis of the existing estate has identified a number of key findings

which require to be factored into the development of the Estates Strategy, which are summarised below:

The University is to continue to operate out of its four existing locations. The Dubai, Orkney and SBC campuses have been identified as no change for the purpose of the Estates Strategy with the focus on the main campus at Riccarton, Edinburgh

The Riccarton campus extends to 364 acres and 162,636 square metres of building and infrastructure space

The University is faced with a backlog maintenance of over £100 million, with current levels of expenditure significantly below recommended levels in terms of providing a sustainable estate

There are significant maintenance, functional suitability, energy performance issues regarding a number of the original 1970’s buildings within the campus. It may be more appropriate to redevelop these buildings rather than undertaking refurbishment

The existing management of space within the University makes it difficult to accurate assess space utilisation. A review of space management is critical in accommodating the University’s anticipated growth

There are significant issues regarding the functional suitability of buildings across the University’s estate

Whilst the University compares favourably against other 1994 Group campus based universities in respect of running costs, the low level of spending on maintenance and property management appears to have had a detrimental impact on the estate. Significant recent increases in utilities costs with anticipated further rises will


S E P T E M B E R 2 0 0 8 5 3

further increase the ongoing costs of operating and managing the estate

The lack of an EIMS system makes it difficult to assess running costs on a building by building basis

The existing environmental performance of the estate is poor and needs to be addressed as part of any strategy, particularly given increasing utilities costs

Due to the campus location within the Green Belt and a number of title restrictions, there is very limited opportunities to dispose of parts of the campus to release significant capital receipts

The existing Estates and Building Services team appears very under resourced and is doing well to ensure the ongoing steady state of the estate. Any significant investment in the estate may be at risk due to the lack of resource to allow for the planning, development and delivery of projects.


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6. Estates Performance Introduction

6.1 This section identifies the existing performance of the University’s estate and how this can address the Strategic Estates Objectives. It sets out a critique of the existing estate, identifying key issues which currently impact on the performance of the existing estate. It then sets out a gap analysis identifying the shortfall between the existing estate and the future vision and requirements. It then sets out programme issues and specific building issues that require to be considered.

Estate Critique 6.2 The existing estate at Riccarton, has been developed over the past three

decades. The older 1970’s buildings are extremely close to an age where any commercial stock would require complete refurbishment or redevelopment to bring it in line with modern standards and changes to the market since construction. There are strong parallels with other university estates, where objectives and requirements have changed significantly over the period.

6.3 The current campus deviates significantly from others we know in the following ways:

The campus has no iconic building. There is a strong recent trend to focus a strong department in a new building or develop a new student centred building as an icon for the University going forward. This also supports the differentiation of the University from competitors and recognises the contribution the estate can make to marketing

The changes in teaching and learning, ICT and growth in student numbers have rendered the existing library not fit for purpose. In addition, there is a strong argument to be made that the library is not in the right location within the campus. There is also a lack of study group space for students throughout the campus

The campus core really needs to be developed to provide a set of buildings offering all the student needs and becoming the real “heart” of the campus. This could be achieved through strong architecture and imaginative public realm spaces in between

The campus core suffers from the high numbers of students against the design numbers and the use and the exact range of services to be provided and located within the Hugh Nisbet building needs to be clearly established. The building needs thoroughly updating and key issues such as corridor widths, traffic routes, the style of catering offer etc need addressing. Any refurbishment works would, however, need to continue to allow access to the main central lecture theatres within the building. Utilisation of part of the existing library should a new library/ learning space be built, could be part of the solution to this problem

Most academic departments have no “front door” or focus area for their students and visitors. When added to the poor signposting around the campus, this becomes an impediment to departments establishing a strong entity for students to identify with. The


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development of the new student residences to the west of the campus will allow the creation of a core dedicated ‘residential zone’. This would provide an opportunity for the creation of a number of distinct zones across the campus which may offer and opportunity to give areas of the campus more of an identity

There is a programme of work necessary to ensure that the University is meeting its compliance obligations in respect of Fire Safety and under the Disability Discrimination Act

A significant part of the estate is tired and in need of refurbishment. The older buildings require comprehensive refurbishment to consider issues such as their thermal performance, environmental controls and layout. All of these items can be addressed as part of a refurbishment programme but there needs to be a unifying vision, ideally expressed through an update to the Masterplan, to maximise the contribution of any such work to the overall campus

There are significant backlog maintenance and functional suitability issues regarding the older student residences. It is unlikely that these issues can be addressed through refurbishment and remodelling and replacement is likely to offer a value for money solution. Provision of modern student accommodation is a key element within the University’s new strategy

There is a lack of a space management policy across the University estate. This is of increasing importance given ongoing rises in respect of running costs

It is of increasing importance to ensure that the University seeks to maximise income generation from the operation of the estate. The University’s existing conference business is currently believed to be constrained by the lack of suitable residential accommodation which has a significant negative on revenue generation

Income generation has also been limited from the Research Park due to the lack of development of phases 2,3 and 4

The University’s main reception is seen to be a ‘good thing’ but it is badly designed with regard to circulation.

Gap Analysis 6.4 It is clearly evident, from the Estate Critique and the review of the existing

estate that there is a significant gap between the University’s vision and future requirements and the existing provision. Specifically there is a need to address a number of fundamental requirements across the estate as set out within Section 4 and summarised below:

Deliver a non residential estate of an appropriate size for the future development of the University




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6.5 For a number of the potential projects outlined above an indicative capital allowance has been identified in the University’s existing Capital Plan, which covers the next ten years. A copy of the existing Capital Plan is included in Appendix 17.

6.6 However, a significant number of projects particularly those emerging from the new University strategy are not currently addressed. In addition a significant number of the projects within the existing Capital Plan are phased towards the end of the ten year period.

Programme and Affordability Issues 6.7 It is clear that the University’s aspirations require almost immediate estate

solutions. As an example, the plan to grow by approximately 700 staff over the next 10 years will require around 180 desks (assuming 600 staff require a desk) in the next three years if this growth is assumed to be linear. The current Masterplan and Capital Plan have no resources dedicated to creating workstations for these staff.

6.8 The existing Capital Plan is also heavily loaded towards the back of the ten year planning period, presumably driven by predicted availability of funds. It is unlikely that the objectives that have been identified through the stakeholder interviews and analysis of the University’s own aspirations can be accommodated with this expenditure profile, even if funds are switched to the highest priority projects.

6.9 Finally on the existing Capital Plan, the recent findings of the study to look a potential models for the future delivery and ongoing management of student accommodation has identified that this will remain with the University. As a result the most significant element of capital expenditure within the Capital Plan is the immediate requirement for new student residences at both Riccarton and SBC. This has obvious impact on the potential to deliver other projects across the University’s estate.

6.10 It is important to appreciate the University’s financial position in considering the development of any revised Capital Plan to meet the Estates Strategy. It is therefore important to prioritise projects that enable the University to


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increase income and/ or are enabling projects for others that increase income or reduce costs.

6.11 There are solutions available to the problem of growing staff numbers in the short term. As an example, if a new library is built, part of the existing library could be used for staff offices. However, this space is probably better used to locate student facing activity such as a new one-stop shop. There is probably a three to four year delay between committing resources to the project to create new office space and delivery of a building.

6.12 In essence, it is clear that resources have not been committed to estate planning far enough ahead of the University’s corporate objectives being set and there will have to be a period of rapid catching up if the provision of an adequate estate is not to be a threat to the delivery of the Strategic Plan. The choices the University has to try and make things happen quickly are:

Adopt a hard line space management policy to enable the space the expansion of staff will require to be freed up as far as possible within the existing estate

Acquire temporary accommodation for a significant number of staff

Close weak or loss making areas to enable stronger areas to grow in that space.

6.13 Alongside the refresh of the Masterplan, we would recommend that a couple of workshops take place to prioritise all of the projects, in terms of:

From a desirability point of view

From a sequencing and operational impact point of view

From a cost and disruption minimisation point of view.

Specific Building Issues 6.14 It is not generally the work of an Estates Strategy, to solve or highlight

problems with individual buildings. However, the prominence, importance and poor performance issues with the Hugh Nisbet building merit particular mention, especially the following:

Identity – the use and the exact range of services to be provided and located within the Hugh Nisbet building needs to be clearly established

Capacity – the building was designed for a far lower campus population

Layout – corridors are narrow, potentially to unsafe levels at peak capacity periods, and the juxtaposition of different uses is not ideal

Style and décor – the building looks dated, especially in the commercial areas such as the catering offerings

Previous investment – the lecture theatres have just been upgraded.

6.15 We would recommend that a detailed study is commission to review options for the Hugh Nisbet building. However, this should be done only


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after the University has carefully developed a brief for the building and determined the spaces that may be available e.g. current library to take into account in planning the future of uses in the building.

6.16 The current library space represents an opportunity if a new library/ learning space is developed. There are opportunities to:

Convert the space to staff offices to accommodate the planned growth

Consider locating the one stop shop, learning zone and administration / student support offices within the space

Consider locating student facing activity across the ground floor and offices above

Demolish the building and rebuild to a larger, bespoke footprint purpose designed for the designated new use.

Estates Strategy Implementation Plan and Monitoring 6.17 It is vital that there is an approved implementation plan for the projects

which comprise the approved Estates Strategy. The failure to implement the outcomes of the 1999 Estates Strategy shows a serious deficiency between the Estate Strategy and available funding in the University. The University cannot afford to adopt another Estates Strategy that fails to be realistic and it is vital that the approved strategy is closely monitored towards delivery.

6.18 We would advocate the following measures:.

A detailed implementation plan which takes financial affordability and sustainability into account should be adopted

Within the plan, target dates and responsibilities for delivery should be identified for the key stages of each of the projects identified within the Estates Strategy:

Feasibility study and business case

Funding

Approval through Governance

Development and delivery

This implementation matrix plan then be:

monitored by the University Estate Strategy Committee

reported on annually to the University Court

target dates to be reviewed as part of the internal audit of projects

formally reviewed every 3 years by internal audit

Development of KPIs for performance in areas such as Space Management and Sustainability.

6.19 These issues are considered in more detail in Section 8.


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7. Strategic Estates Options and Appraisal Introduction

7.1 This section sets out a range of strategic options that have been considered for the optimum solution for the University’s estate. It also details the financial and qualitative appraisal of the options and the identification of a preferred option.

7.2 As set out within Section 5, the University’s strategy for the Orkney and Dubai campuses has been deemed to be no change for the purposes of the Estates Strategy. For the SBC, it has been identified that the key issue for the campus is the replacement of the student residential accommodation.. Given the University’s commitment to the SBC campus it has been assumed that the new residences will be a constant under each of the strategic estate options developed.

7.3 On the basis of the above, the strategic options developed and considered within this section have been focused on the optimum solution for the Riccarton campus.

Range of Strategic Options 7.4 Four strategic options have been generated for the future provision of the

Riccarton, campus. The options are as follows:

Option 1 – do minimum



Option 4 – relocation to a new site.

7.5 These options are sequential in nature, each in turn representing a greater degree of change. A description of each of the options is set out below.

Option 1 –do minimum/ base case

7.6 This option assumes that the University will continue in its current operation and will retain its buildings in their existing form. It is assumed that under this option the University would develop a maintenance strategy to address the statutory compliance and condition issues across the Riccarton campus as detailed within the University’s existing Capital Plan. However, this option would not address any of the Strategic Estates Objectives identified within Section 4.

7.7 Clearly this option will not meet the University’s future strategy. It does, however, provide a base case against which the other options can be evaluated.


7.8 Option 2 assumes that the University would undertake a series of refurbishment, remodelling and replacement projects across the estate to reflect the University’s existing Capital Plan. A copy of the University’s existing Capital Plan is included in Appendix 18.

7.9 The existing Capital Plan includes the following projects:


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Planned Maintenance Strategy (in accordance with Option 2 identified by Dearle & Henderson)

Refurbishment and remodelling of the Hugh Nisbet building carried out in two phases

Refurbishment and upgrading of teaching and research space in accordance with SFC and DIUS funding

Learning spaces refurbishment

New Library building

New Study Group building

New residences at Riccarton as part of creation of Student Village, demolition of the existing Residences I and II

Renovate Leonard Horner Hall for conference accommodation

New Student Facilities Building

Land purchase to the south of the campus.

7.10 In addition to the Capital Plan projects, its has been assumed that the University would also develop a ‘Space Management Project’, implement an EIMS system, and develop a strategy for the future development of the Research Park under this option.

7.11 The underlying assumption within Option 2, is that it will only address the projects identified within the existing Capital Plan. As a result a number of the projects outlined above, such as the provision of a new library or study group building would only be delivered during years 6-10 (2013-2018). This option does not address a number of the future requirements identified for the estate such as any expansion to meet increased staff numbers or for significant remodelling of existing space to meet changing research, teaching and learning requirements.

7.12 The implementation of Option 2 is likely to have a significant impact on the ability on the University to deliver its vision and strategy. It does, however, reflect a range of projects and expenditure consistent with the University’s existing Capital Plan. It has therefore been deemed as appropriate to be considered as part of a more detailed appraisal of the options.


7.13 Option 3 is an extension of Option 2, but reflects the University estate being developed to reflect the University’s vision and future requirements as set out in Section 4.

7.14 Whilst the projects to be considered in Option 3 will be similar to those in Option 2, it is anticipated that they may delivered in a shorter timescale than currently anticipated within the existing Capital Plan. Additionally Option 3, would include:

Provision of additional staff accommodation to reflect anticipated growth in line with Focus for the Future

Additional programme of upgrading and refurbishment of existing teaching spaces across the campus, to address functional suitability and space utilisation


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New one stop shop for student facilities

Investment in a range of environmental and energy saving projects

Update Masterplan and allow a ‘marketing enhancement’ to selected projects

Increase levels of ongoing maintenance spend per annum to similar levels as the 1994 Group.

7.15 Option 3 has been developed to reflect the University’s strategic vision, however, there may be significant financial constraints regarding its potential delivery and implementation. It has, however, been deemed as appropriate to be considered as part of a more detailed appraisal of the options.

Option 4 – relocation to a new site

7.16 The University has considered the need to consider a full range of options as part of this Estates Strategy. As part of this process, Option 4 assumes the total relocation of the University to a new campus with the disposal of the existing site and buildings at Riccarton. This option would also offer the opportunity for the University to rationalise its existing operations at Orkney, Dubai and Galashiels as part of a single campus solution.

7.17 Option 4 has not been considered in great detail for the following reasons:

The University only completed its relocation from central Edinburgh in 1992. Since 1992 there has been an ongoing programme of development across the campus to support the growth of the University. As outlined in Section 5, since the previous Estates Strategy in 1999 the University has completed a number of new developments to the campus and is currently in the process of building a new postgraduate centre. Any potential relocation would be to the detriment of the investment and resources that the University has made at the Riccarton campus

There is unlikely to be a suitable site of the correct size or at an affordable value within the market

The tenure analysis set out in Section 5 demonstrates that the Riccarton campus is unlikely to generate a sufficient capital receipt for the University to make a relocation economically feasible

The University’s co-location with Borders College was undertaken on the basis that the SBC Campus would remain in Galashiels. The ongoing redevelopment of the campus including the refurbishment of the High Mill shows the University’s long term commitment to this arrangement

The Dubai campus is part of the University’s strategy for growth in International students and its reputation as Scotland’s most international University. Focus on the Future sets out the intention to grow the University’s presence throughout the world and extend the global reach beyond the Dubai campus

The Orkney campus is specifically located to provide the range of teaching required by the University’s ICIT.


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7.18 On the basis of the above Option 4 has been discounted from any further analysis.

Options Appraisal 7.19 Of the four options generated for the future of the Riccarton campus, only

the following options have been identified as appropriate for more detailed appraisal:

Option 1 – do minimum/ base case


Option 3 – develop the estate to reflect future requirements.

7.20 For each option a high level financial and non financial appraisal has been undertaken which is set out below.

Financial Appraisal

7.21 In order to assess the financial implications for the University of each of the options an investment appraisal has been undertaken in accordance with the Treasury Green Book. This allows for analysis of the principal elements of cost in terms of capital and ongoing revenue costs and also income for each option and the generation of a net present cost to allow comparison of the options.

7.22 The principal sources of data within the financial appraisal and the relevant assumptions used are set out below:

Capital costs – are based on the University’s Capital Plan and the assumptions for future requirements set out in Section 4

Revenue costs – are based on the University’s EMS dataset for 2006/07

Discount rate – a rate of 3.5% has been used as set out within HM Treasury Green Book.

7.23 The table below summarises the results of the financial appraisal. The detailed financial appraisal for each option are set out in Appendix 19.

Option Description Net Present Cost (NPC)

Ranking

1 Do minimum/ base case [tbc] 1


[tbc] 2


[tbc] 3

7.24 As the table above highlights, Option 1 is ranked first in financial terms. This option, however, fails to address any of Strategic Estates Objectives identified within Section 4, and does not reflect the University’s new strategy under Focus for the Future.

7.25 Option 2 is ranked second in the financial appraisal. It represents the University’s existing Capital Plan and therefore reflects a range of projects and timescales which will be deliverable in accordance with the University’s


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finances. It represents the implementation of a range of key projects which are required across the University estate. Option 2, however, does not meet all of the University’s aspirations under Focus for the Future and for a number of the critical projects identified within the Estates Strategy such as the a new Library, this will not be provided until towards the end of the ten year period.

7.26 Option 3 is ranked third in the financial appraisal reflecting the additional investment required to meet the intended aspirations of Focus for the Future. Clearly there are significant issues regarding the availability of financial resources within the University to deliver Option 3. In addition a number of the assumptions within Option 3, such as the requirement for additional staff accommodation will be dependant on the success of the implementation of the University’s new strategy.

Qualitative Appraisal

7.27 In addition to the financial appraisal, each of the options has been evaluated in qualitative terms by assessing the non quantifiable benefits of each option with reference to the University’s priorities.

7.28 A range of qualitative criteria have been developed by the University, which are set out below:

Improves research, teaching and learning facilities

Overall impact on ability to recruit - national / international

Level of implementation associated risk

Option implementation and disruption

Improves space efficiency

Flexibility of implementation within option

Enhances identity / profile / image of the University

Improves functional suitability of the accommodation

Improves student facilities.

7.29 The qualitative criteria have also been weighted to reflect their relative importance to the University and have been scored in terms of their ability to meet the selected priorities. This generates an overall qualitative score for each option.

7.30 The table summarises the results of the qualitative appraisal. Details of the individual weighted scores for each option are included in Appendix 19.

Option Description Qualitative Score

% Ranking

1 Do minimum/ base case 9.5 22% 3


23.5 54% 2


36.5 84% 1


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7.31 The results of the qualitative appraisal are similar to those of the financial appraisal. Clearly Option 1 will provide very limited qualitative benefits to the University and as a result scores significantly below Options 2 and 3.

7.32 Option 2 will provide a number of qualitative benefits to the University’s estate and address a number of the key issues identified within the Estates Strategy. However, as the qualitative appraisal of Option 2 reflects it will only provide limit benefits in respect of a number of the qualitative criteria, such as enhancing the identify and profile of the University and the overall ability to recruit. Option 3 is clearly ranked first in terms of the qualitative appraisal reflecting the enhanced investment and qualitative benefits within the estate.

Preferred Option 7.33 The table below summarises the ranking of the financial and qualitative

appraisal of each of the options.

Option Description Financial Ranking

Qualitative Ranking

1 Do minimum/ base case 1 3


2 2


3 1

7.34 The results of the financial and qualitative appraisal does not result in the clear identification of a preferred option. Discounting Option 1 from further consideration, from a financial perspective Option 2 is the most beneficial to the University and reflects a level of investment which is sustainable in accordance with the University’s financial resources. However it does not fully meet the requirements of the University’s new strategy set out in Focus for the Future as reflected in the qualitative analysis score.

7.35 Option 3 is clearly ranked first in respect of the qualitative criteria, however, the Net Present Cost (NPC) and level of investment required is significantly above Option 2. There are clear issues regarding the potential deliverability of this option from a financial perspective. In addition, a number of the assumptions and projects within Option 3 are dependant on the success of the implementation of the University’s new strategy under Focus for the Future. At this stage, it is perhaps too early within the process to accurately identify what the specific requirements will be for the University’s estate.

7.36 On this basis it is recommended that Option 2 is the preferred option for the Estates Strategy.

7.37 It is, however, recommended that regular monitoring and periodic updates are undertaken of the Estates Strategy so that it remains flexible and responsive to the emerging needs from the implementation of Focus for the Future. As part of this process it is recommended that additional requirements for the estate identified in Option 3, are factored into the recommended update and refresh of the Masterplan. This will allow the University to be in a position to respond quickly to the emerging requirements of Focus for the Future.


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8. The Way Forward Introduction

8.1 This section sets out the proposed way forward for the delivery and implementation of the Estates Strategy. It sets out further details of the preferred option, the key stages to be followed in the development and delivery of projects. The proposed prioritisation of the projects, review procedures and a consideration of key risks.

The Preferred Option 8.2 Within the preferred option, there are a number of projects that will require

be delivered over the period of the Estates Strategy. Further details of the specific projects within the Estates Strategy and Capital Plan are set out below:

New student residences and associated facilities at Riccarton – 600 new bed spaces to be delivered in two phases (400 bed spaces in phase 1 and 200 bed spaces in phase 2). These will be located to the west of the campus allowing the creation of a dedicated student residences zone within the campus. The existing Residences I and II in the heart of the campus will be demolished following the completion of phase 1. As part of the creation of the student residential zone it is also proposed to provide a new student facilities building within this part of the campus

New student residences at SBC – up to 250 new bed spaces to be provided to replace the existing residential accommodation at SBC

Hugh Nisbet building refurbishment – an extensive refurbishment and remodelling of the Hugh Nisbet building is to be undertaken. Given the range of existing functions within the building and its location in the ‘core of the campus’ it is proposed to undertake the refurbishment over two phases

New Library – a new Library building is to be provided. This is likely to be located in the site currently occupied by Residences I and II in the heart of the academic area of the campus

Learning spaces refurbishment and Study Group building – a programme of refurbishment works is to be undertaken across the various academic departments to create learning spaces for students. In addition it is proposed to create a dedicated Study Group building

Conference accommodation – new residential accommodation is to be provided for the University’s conference business. This will involve the redevelopment of the existing Leonard Horner Hall and also the conversion of the existing Students Association building. This will create a conference zone within the campus

Refurbishment and upgrading of teaching and research space – a programme of refurbishment works are to be undertaken across the campus. This is to be funded through SFC and DIUS funding

Compliance and maintenance works – a ten year programme of compliance and maintenance works will be undertaken across the


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campus. This reflects the second option identified by Dearle & Henderson as part of a 10 Year Planned Maintenance Programme

Land purchase to the south of the campus – this will allow for the future expansion of the University estate as outlined within the existing Masterplan.

8.3 In addition to the Capital Plan projects, it is recommended that the following projects are also undertaken:

Space Management Project – a comprehensive study into the existing utilisation of space across the campus should be undertaken. This will seek to develop a range of policies and initiatives to deliver a more efficient usage of space across the campus

Procurement and implementation of an EIMS system – as outlined previously, it is recommended that the University procure and implement and EIMS system for its estate. There will be a significant resource implication involved in the data gathering and validation to ensure that the system can provide optimal benefit to the University estate

Masterplan refresh – it is recommended that the Masterplan is updated and refreshed to reflect the new strategic direction of the University and the Estates Strategy

Future development of the Research Park – It is recommended that the University considers options that will help facilitate the future development of the Research Park. This may involve the University looking to end the existing joint arrangement with Scottish Enterprise and take sole responsibility for the development of the Research Park. As part of this option the University may be required to pay approximately £5M to Scottish Enterprise reflecting the cost of infrastructure works undertaken to phases 2,3 and 4 of the Research Park

Undertake feasibility studies to reflect the requirements of the strategic review – it is recommended that as the output from the strategic review process become more finite that the University undertakes feasibility studies to consider how best these future requirements can be provided within the estate.

Project Development and Implementation 8.4 As the list above demonstrates there are a significant number of projects to

be delivered across the estate during the period covered by the Estates Strategy. The failure to implement the outcomes of the 1999 Estates Strategy has increased the need for urgent and extensive action across the estate. The University is not in a position to allow this to happen again.

8.5 The SFC is about to issue revised guidance on the Capital Planning Process and it is recommended that the University adopts the use of this guidance as part of its processes for the development and implementation of projects.

8.6 We have summarised below the key stages that should be adopted as part of the project development and implementation process:


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Feasibility study and Business Case – the first stage involves undertaking a feasibility study, identifiying the business need and project requirements and an appraisal of options. This should be developed in accordance with HM Treasury ‘Green Book’ Consideration should be given to the whole life cost of a project and ensure that it is consistent with SFC Sustainable Development Guidance. The preferred option should then be developed in more detail through the development of an Outline Business Case (OBC) and subsequent Full Business Case (FBC)

Funding availability – throughout the project process it will be necessary to ensure that there is available funding to allow the project to proceed. Project affordability should consider not only address the initial capital expenditure required but also the ongoing maintenance and operation costs that will be associated with the implementation of a project

Project approval – projects require to be subject to appropriate scrutiny and approval processes. The use of ‘Gateway’ approvals such as those identified by the Office of Government Commerce (OGC) at selected distinct stages within a project lifespan is recommended. Appropriate approval process should be built into the management structure and committees within the University

Implementation – it is necessary to ensure that the appropriate procedures and resources are in place to ensure that projects are delivered on time and to budget. Different procurement routes are likely to reflect varying resource inputs and it is critical that these reflect the correct sharing of risk between the University and third party providers

Post Occupancy Evaluation (POE) – following the implementation of a project a review of planning, delivering and completing a project together with technical and functional performance of a building should be undertaken. POE is a way of providing feedback throughout a project lifecycle, which should then be used to inform future projects. The SFC has developed Capital projects: post-occupancy evaluation guidance to provide a framework for this process.

8.7 Throughout each of the key stages it will important to ensure that the project process it will be necessary to ensure that they are sustainable in terms of:

Financial Sustainability

Physical Sustainability

Environmental Sustainability.

8.8 For each of the keys stages within a project it will be necessary to ensure that clear roles and responsibilities are assigned within the University together with appropriate timescales an identified milestones.

Prioritisation of Projects 8.9 Given the extensive number of projects to be delivered across the estate as

part of the Estates Strategy, it is evident that they require to be prioritised.


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Whilst ideally all of the projects are required urgently this is unlikely to be feasible in terms of available funding and resources within the University. In addition, a number of the projects are linked and will be dependant on the successful delivery of others, such as the new Library being developed on the existing site of Residences I and II.

8.10 In the table below we have set out the proposed prioritisation of projects within the Estates Strategy:

Project Priority Timescale

New residences and associated facilities at Riccarton

Immediate 2008 - 2012

New residences at SBC Immediate 2008 – 2010

Hugh Nisbet building refurbishment High 2010 - 2013

New Library High – but dependant on re-provision of Residences I and II

2012 - 2014

Learning spaces refurbishment and Study Group building

Learning spaces – High Study Group building – Medium

2009 - 2011

Conference accommodation High 2012 - 2015

Refurbishment and upgrade of teaching and research space

High Ongoing annual programme

Compliance and maintenance works Immediate Ten year programme of works developed

Land purchase to the south of the campus Medium 2015 - 2016

Space Management Project Immediate 2008 – 2009

EIMS system High 2008 - 2010

Masterplan refresh High Following completion of strategic review

Future development of the Research Park High Ongoing

Feasibility studies to reflect the requirements of the strategic review

Medium Ongoing as specific requirements begin to emerge

Note: The timescales above include an allowance for project feasibility and set up

Flexibility and Review Procedures 8.11 Given that the University’s new strategy is still being developed, it is

important to ensure that the Estates Strategy is flexible to respond to emerging requirements. It is recommended that feasibility studies are undertaken to identify how emerging requirements from the strategic review can be addressed within the estate.

8.12 A key aspect of ensuring the flexibility and appropriateness of the Estates Strategy is to ensure that it is reviewed on a regular basis. In addition to the requirement to submit an annual update of the Estates Strategy to the SFC, it is also recommended that the University adopts the following review procedures:

Monitored by the University’s Estates Strategy Committee

Reported on annually to the University Court

Projects are subject to regular formal review, regarding progress, target dates and achievement of milestones

Formally reviewed every three years by internal audit.


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Risk 8.13 To successfully deliver and implement the Estates Strategy it is necessary

to consider the principal risks which may impact on its implementation and delivery. Whilst each individual project will be subject to a detailed assessment of risk, we have identified below two principal risks which will significantly impact on the overall ability to deliver the Estates Strategy, which are:

Available funding

Resources.

8.14 Further consideration of these two risks is set out below.

Available funding

8.15 The failure to implement the outcomes of the 1999 Estates Strategy, shows a serious deficiency between the Estate Strategy and available funding in the University. Lack of available funding is clearly a key risk to the delivery of the Estates Strategy.

8.16 We understand that the University is in the process of gaining approval to borrow the required funding set out within the Capital Plan. If approved this funding requires to be ‘ring fenced’ for the projects outlined within the Estates Strategy. It will also be necessary to ensure that a whole life cost approach is adopted so that sufficient funding is set aside to ensure that new and refurbished buildings are appropriately maintained. The recent publication BS ISO 15686-5 Buildings and constructed assets, service life planning, life cycle costing has been recognised as an international standard for life cycle costing by the RICS and it is recommended that this guidance is used by the University in assessing whole life costs.

8.17 In addition to the Capital Plan funding, it will also be important that the University ensures that there is appropriate funding and resources available to address some of the non capital elements within the Estates Strategy such as the Space Management Project.

Resources

8.18 As outlined in Section 5, the University’s existing Estates and Building Services department appears very under resourced when compared to similar sized institutions. This was reflected in the low cost per square metre when compared to the 1994 Group campus based universities and analysis against other universities within the Audit Scotland report. It would appear that the existing resources are currently over stretched ensuring that the estate continues to function on a day to day basis.

8.19 Given the number and range of projects that are proposed under the Estates Strategy, this will significantly increase the workload on the Estates and Building Services department. Clearly there is a significant risk to the delivery of the Estates Strategy through the lack of sufficient resources within the department.

8.20 We would recommend that a review of the existing structure, roles and responsibilities with the Estates and Building Services department is undertaken. In addition an assessment of the likely resource input required for the delivery of the Estates Strategy should be undertaken. This will allow for a more detailed consideration of the potential risk and resource implications required for the delivery of the Estates Strategy.

heriot - watt university - watt university estates strategy 2008 september 2008 2 summary 25 the...

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