The Canadian federal government’s student visa cap has created a new challenge for higher education institutions, which have become accustomed to the capital inflows accompanying international students. Higher education institutions, which have historically sought funding from the federal government, are looking at new ways to align with these funding sources, given the tapering of new international students and their revenues.
As such, The SHURE Initiative convened a high-level session of post-secondary stakeholders on March 26 in Vancouver to brainstorm creative capital raising.
Gary Morrison, Chief Executive Officer, UFV Properties Development Corporation
“The Government has a lot of competing priorities,” according to Gary Morrison, who recently took on the CEO role at UFV Properties Trust. “However, B.C. Builds has just been launched, which has loosened up some of the income criteria to make funding for affordable housing more accessible.”
Morrison participated in the SHURE-Vancouver discussion with Greg Dewling, President and Chief Executive Officer of the University of Alberta Properties Trust, Jennifer Sanguinetti, AVP of Facilities and Campus Planning of Simon Fraser University, and Jared Everett, Managing Director of University Partnerships at Greystar.
Jared Everett, Managing Director, University Partnerships, Greystar
Jared Everett, who previously worked in higher education before moving into the private sector, noted the challenge of securing capital from government agencies and raised the importance of being strategic with university resources.
“It was more strategic. It was about financial resources or the lack of financial resources. We waited for decades for the state or federal governments to have funding come down the river, and we kept waiting for that money to come down the river, but it never did. And so our campus continued to age,” Everett told the audience.
Greg Dewling, President and Chief Executive Officer, University of Alberta Properties Trust
Greg Dewling of the University of Alberta Properties Trust is currently actively managing 300 acres of development on the South Campus of the University of Alberta, the second largest landholder in Alberta, just behind the Government of Alberta. Dewling joked that due to funding challenges, the University of Alberta Properties Trust would not “exist if there was enough funding.” Dewling said the recently announced student visa cap makes his job and others in higher education more challenging. According to Dewling, the post-secondary education arena is heavily regulated, and the math needs to be revised.
“The market will dictate what your operating costs are, and so your tuition never ever meets your operating costs,” according to Dewling. “And, then the government comes along and says, there’s a fixed amount of taxpayer income that we’re going to allocate to the post-secondary arena that never makes up for the difference, and now the federal government has come along politely and said, oh, by the way, where you can actually make up some money, we’re going to cap that as well.”
Jennifer Sanguinetti, AVP Facilities and Campus Planning, Simon Fraser
Jennifer Sanguinetti of Simon Fraser University told the SHURE audience that alignment between higher education institutions and the government is discovered through extensive relationship building.
“Finding the spots where the university’s academic mission and the government’s priorities are aligned is vital. Without that alignment, it doesn’t matter if you desperately need a new building. If the government doesn’t really care, they’re not going to fund it,” said Sanguinetti.
“The government relations team is critical in this, and their ability to read the room at the political level is absolutely critical. Without that, you’re not getting anything,” according to Sangiunetti.
Gary Morrison cautioned against rushing new development to appease the Canadian housing crisis.
“We can’t just throw up quick, cheap housing because that will be a disaster in the long term,” said Morrison. “So, I’ll be nudging the government to think about long-term social sustainability, livability, and the cost of living over the property’s life cycle and to see if they’ll explore funding things like that.”
Everett of Greystar concluded the session, noting that equity investors are now more interested in on-campus relationships than in prior years.
“10 years ago on campus maybe seemed a little bit more risky because you had a ground lease instead of fee simple or you had another partner who was telling you what the rents needed to be, and you had that risk, and now, you know, just with the cycles, it’s a complete flip,” concluded Everett.
