U3 Ventures

ANCHOR INSTITUTIONS

Michigan Municipal LeagueSeptember 23, 2009

Examining the Relationship

• Anchors’ role in the intellectual life of cities is well understood– Relationship with

community/city/region has shifted from Town-Gown to Economic Engine

– Today commonly identified as part of a city’s narrative and a point of civic pride

• Less understood:– Economic impact– Industry and business creation– How they shape the built

environment– Influence the Social Fabric at

the Neighborhood Level

Understanding the Interdependencies

• The business of Higher Education:– Employment Base– Procurement of Goods– Capital Investment– Generator of Service Economy

• Institutions are major land and property owners

• Institutions attract significant research funding

• Impact both supply and demand side of real estate

Anchor Strategies

• Community Builders

• Planners and Developers

• Engines for Driving Economic Growth

A Community BuilderDr. Martin Luther King Library, San Jose State

University

Dr. Martin Luther King Library, San Jose

The King Library is the library for San José State University and the Main Branch of the City of San José Library System

Opened August 1, 2003

Project cost of $177.5 million was shared by the State of California, the City of San José Redevelopment Authority, San José State University, and private fundraising

Planner / DeveloperThe University of Pennsylvania

Penn in the early 90’s

By the early 1990’s West Philadelphia and the University faced a multitude of problems

– Crime

– Migration to Center City

– Alienation from community

– Deteriorating neighborhood

…and moving forward

By rediscovering its historic relationship with the City, Penn energized the full potential of its academic and institutional resources to both contribute to a great city and sustain a vibrant urban campus.

Building on a shared vision

– Make neighborhoods safe and secure

– Attract a year-round housing community

– Develop destinations for shopping, dining, and entertainment

– Invest in public education

– Integrate the Campus into the urban fabric

Penn, along with community partners, developed the West Philadelphia Initiatives to improve the University City neighborhood:

Mixed Use And Retail

The University has embraced a strategy to attract a diverse mix of businesses to campus

• University Square: 300,000 sf, $90 million mixed-use development composed of national retailers

• 40th Street: a retail corridor connecting campus and community, built around a mix of local businesses, community amenities, international cuisine, and cultural and entertainment venues

Market Rate and Student Housing

• Left Bank, $70 million• Domus, $100 million• The Hub, $23.5

million• 3900 walnut, $75

million

Commercial and Entertainment

The Bridge Cinema, $53 million

Translational Research Laboratory, $75 million

WXPN / World Café, $13 million

An Engine for Economic Growth

Detroit Neighborhood Anchors, Detroit, Michigan

Context• Detroit needs a new strategy to address

disinvestment and deteriorating socio-economic conditions

• Foundations have assumed a leadership role in neighborhood sustainability and revitalization

• Right-sizing will reduce the City’s footprint, requiring the identification of viable districts

• Declining public, private, and philanthropic resources requires a more effective decision-making process

• Despite such challenges, anchor institutions continue to exhibit stability and growth

HIGHER EDUCATION

Wayne County Community College(Northwest Campus)

College for Creative Studies

University of Detroit - Mercy

Marygrove College

Wayne State University

UDM School of Dentistry

Wayne County Community College(Eastern Campus)

Lewis College of Business

WCCC (Downtown Campus)

UDM School of Law

STUDENTS

Total: 51,673 students

~300

2,756

4,652

31,016

~3,500

~3,500

~3,500

736

1,358

355

Sources: University representatives & websites, IPEDS

HEALTHCARE

Detroit Medical Center

Henry Ford Hospital System

Detroit Hope Hospital

St. John Detroit Riverview Hospital

DMC Sinai-Grace Hospital

St. John Hospital & Medical Center

St. John / Conner Creek Village

HOSPITAL BEDS

Total: 3,379 beds

404

~120

751

1,300

804

Sources: Hospital representatives and websites, American Hospital Association, U3 Ventures modeling

EMPLOYMENT

Total Direct Employment: 36,200 Employees

2,432

~720

8,045

450

5,036~90

204

~720

8,115~230

~230

~230

~110

9,532

~60

Sources: Hospital & University representatives and websites, IPEDS, American Hospital Association, U3 Ventures modeling

OPERATING BUDGET

Total Direct Expense:

$6.4 Billion

$331

~$127

$1,740

$33

$508_~$2

$34

$84

$2,060~$20

~$10

$1,276

~$6

~$20

~$20

Sources: Hospital & University representatives and websites, IPEDS, American Hospital Association, U3 Ventures modeling

STUDENT RESIDENTIAL CAPTURE

• Analyzed three institutions:–Marygrove College–University of Detroit – Mercy–Wayne State University

Students

Employees

Total Number 39,094 2,725

% living in Detroit 34% 30%

% living 1 mile from Campus

13% 9%

• Over 32,000 students and employees living outside of Detroit

• Represents $211 million in discretionary income leaked outside city limits

GOODS AND SERVICES PURCHASED

• Anaylzed three major Detroit anchors:–Wayne State University–Detroit Medical Center–Henry Ford Hospital

• All goods and services purchased: $1.8 Billion

• Purchased in Detroit: $257 Million

• 84% of all purchases leaked outside of Detroit

HIGHER EDUCATION

REGIONAL POPULATION(July 1, 2005)

RANK

1

2

3

4

5

6

7

8

9

1011

12

13

14

15

16

17

18

19

20

21

22

23

24

25

Source: Impact of Higher Education in Greater Philadelphia by Select Greater Philadelphia (2007)

TOTAL ENROLLMENT (2005/06)

RANK

1

2

3

4

5

6

7

8

9

10

11

12

1314

15

16

17

18

19

20

21

22

23

24

25

Source: Impact of Higher Education in Greater Philadelphia by Select Greater Philadelphia (2007) – Derived from IPEDS

BACHELOR’S DEGREES OR HIGHER AWARDED(2004/05)

RANK

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

1920

21

22

23

24

25


R&D FUNDING PER STUDENT(Federal, State and Local, Industry, and other, in millions – 2005/06) RANK

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

2223

24

25

Source: Impact of Higher Education in Greater Philadelphia by Select Greater Philadelphia (2007) Derived from National Science Foundation

CORE EXPENDITURES PER STUDENT(University operating expenses in millions 2005/06)

RANK

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

2324

25

Source: Impact of Higher Education in Greater Philadelphia by Select Greater Philadelphia (2007) – Derived from IPEDS & Surveys

% OF STUDENTS FULL-TIME(2005/06)

RANK

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25


HEALTHCARE

City of Detroit

Wayne County

Detroit Metro

Michigan

912,000

1,950,000

4,425,000

10,000,000

9% of Michigan's Population

Population

Source: Detroit Medical institution Representatives; American Hospital Association

City of Detroit

Wayne County

Detroit Metro

Michigan

3,379

5,212

10,720

25,540

HEALTHCARE Hospital Beds

13% of Michigan's Hospital Beds


City of Detroit

Wayne County

Detroit Metro

Michigan

25,900

34,700

67,130

164,300

HEALTHCARE Hospital Employees

16% of Michigan's Hospital Employees


City of Detroit

Wayne County

Detroit Metro

Michigan

$4,275

$5,510

$9,825

$21,200

HEALTHCARE Operating Budget (in millions)

20% of Michigan's Hospital Budget


EXAMPLE: MIDTOWN ANCHOR DISTRICT

Detroit:Midtown

Pittsburgh:Oakland

Cleveland:University Circle

IndianapolisCanal District

EXAMPLE: MIDTOWN ANCHOR DISTRICT

INPUTS

Ed’s 12,451 40,80532,300

70%Med’s485,404 536,180524,533

77%Culture550,000 1,800,00

0

100%

OUTPUTS

Population

5,231 22,45819,285

82%

Density 6,750 26,0008,600

10%Income$21,500

0%

30,100

Age 36

0%

23

Education

30%

0%

63%

RECOMMENDATIONS• Within the anchor districts, programs to “ live, buy and

hire local” should be initiated and institutionalized– definition, sizing and institutionalizing of local programs within

each anchor – creating a sustainable structure to collaborate between anchors – provide an infrastructure of support through CDCs to meet the

demand generated by Local Programs

• Anchor district projects must be managed and coordinated holistically – institutional changes– physical interventions– comprehensive set of support services

• Midtown has the greatest potential to redefine Detroit with eventual economic benefit for all neighborhoods

Leveraging Local Impact

• Live Local, Buy Local, Hire Local• Creating desirable neighborhoods• Increasing economic impact

– 7% of total vendors from Detroit– 16% of dollars spent with vendors from

Detroit • Increasing capture in Detroit means

– $28 million with 10% increase– $71 million with 25% increase– $142 million with 50% increase

Conclusion

Engaged anchors form a strong and mutually beneficial bond with neighborhoods and cities

For the anchor, engagement helps produce more enlightened community enhances the opportunity for “real and impact-ful”

institution provides greater opportunity to disseminate its

intellectual discourse to the public For a City, an engaged institution

anchors a neighborhood providing a long term and sustainable employer, developer and citizen

creates a unique district that integrates academic life in the public realm

U3 Ventures

Education

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