First Stages of Residence Hall Project Could Generate Nearly 2,900 Jobs; Millions in Tax Revenue
LEXINGTON, Ky. (Aug. 20, 2012) ― University of Kentucky President Eli Capilouto ― along with Lexington Mayor Jim Gray and other officials ― announced today that construction of several residence halls on campus over the next few years could support nearly 2,900 jobs and generate nearly $4 million in state and local taxes.
"We must and we will recruit the best students in the state and the region. We must provide the kind of exemplary undergraduate educational program that tells students there is no finer experience than at UK. And we must provide for our state the workforce that will build a vibrant, sustainable knowledge-based economy for the future," Capilouto said during a news conference at the New Central Residence Hall currently under construction. "The legislature's vision in authorizing this approach leverages our ability to do all of these things. At the same time, it could pave the way to the creation of thousands of jobs and millions of dollars in investment in our community and state.
As with the $579 million hospital tower we recently opened, this project underscores the critical role UK plays in Kentucky's current economic development efforts even as we chart a course forward in helping the Commonwealth create a vibrant, knowledge-based economy for the future."
Last year, the UK Board of Trustees approved plans to enter into a public-private partnership with Memphis-based EdR, one of the country's largest developers of collegiate housing, to build a $25.8 million, 601-bed modern residence hall on Haggin Field in the heart of the campus. It is the first building in what could be a five-to-seven year construction project to tear down and erect a new residence hall system, creating up to 9,000 beds on UK's campus. UK currently has about 6,000 residence hall beds, fewer than 700 of which are considered modern. The first residence hall represents:
- $15.7 million in expenditures for building construction materials, wages and benefits, among other items to date
- 509 direct and indirect jobs
- $500,000 in state taxes; $260,000 in local taxes
- In October, the UK Board of Trustees will consider the first part of the project's next phase ― the construction of four additional residence complexes, totaling 2,098 beds.
- If approved by the board, the Phase II-A project would include $118 million in expenditures, support more than 2,300 direct and indirect jobs and generate nearly $1 million in local taxes and nearly $2.2 million in state taxes.
The total project could cost $500 million, all of which represents private equity brought to the table by EdR. In each case, EdR would construct and own residence halls on land leased to it by UK. Each phase of the project must be approved by the UK Board of Trustees.
The first residence hall ― New Central, which is scheduled to open in August 2013 ― will house Honors students as well as classrooms and office space for faculty. It represents the first residence hall constructed on campus since 2005.
"Change happens every day within our University, but rarely is it seen," said UK Student Government President Stephen Bilas. "Watching a foundation being laid that will lead our institution into the future inspires everyone, both students and employees, to invest in the Kentucky Promise."
"The potential of this public-private partnership ― one that is unlike anything else in higher education ― can be transformative for UK and the Commonwealth of Kentucky," said Pam May, vice chair of UK's Board of Trustees. "At the same time, as a board, we are entrusted as stewards to safeguard this institution and help guide its progress going forward. We will carefully and thoroughly examine these plans at each stage to ensure that we move forward thoughtfully and strategically."
In support of the university’s interest in moving to Phase II, the Kentucky legislature recently authorized the next $175 million for this public-private partnership. Subsequent phases of the project, if approved and undertaken, would generate still thousands more jobs and millions more in state and local taxes.
In late 2011, after months of dialogue among faculty, students and staff, the Board of Trustees and Capilouto directed that enhancing undergraduate education and revitalizing campus facilities would be top priorities.
After an extensive process involving a request for proposals and negotiations, UK chose EdR as its partner for the first phases of the massive residence hall revitalization effort.
“Our public/private partnership and this campus revitalization project are also making an impact across the United States,” said Randy Churchey, president and chief executive officer of EdR. “This revitalization project, its funding and our creative partnership are making a name for the University of Kentucky and its leadership as imaginative, forward-thinking leaders who are smartly moving their university into a brighter future.”
EdR is one of America's largest owners, developers and managers of collegiate housing. A self-administered and self-managed real estate investment trust, EdR owns or manages 65 communities in 24 states with more than 36,300 beds within more than 12,000 units. For more information, please visit the company's website at www.EdRtrust.com.
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