STUDENT CENTRE PROJECT
Vote! May 27th from 2 pm – 4 pm at the Extraordinary General Meeting in AfterMath
Artist’s rendering of the interior Mall of the new Student Centre as currently envisioned by Your SUS!
Processes completed so far in the project:
• A Memorandum of Understanding was developed between the University and the SUS
• MHPM Project Managers hired to lead the project
• Chernoff Thompson named team Architect
• A Business Case was developed to identify the goals and scope of the project
• The project was registered with Canadian Green Building Council as a candidate for LEED Gold certification
• A Space Program is being developed in consultation with User Groups
• A Schematic Design was begun with the Architect
• The project will attain a minimum LEED Gold certification through the Leadership in Energy and Environmental Design for New Construction Green Building Rating System, and will make considerations for the following:
• A 50-year life cycle for the building requiring durable materials and construction methods
• Supported sustainability management plans ( i.e. water, energy & GHG management )
Sustainability objectives include:
• Energy cost savings 50% below the industry standard
• Greenhouse gas (GHG) emission reductions of 50% relative to a standard design
• Water consumption reduction of 40% relative to an average water efficient design
• Low material intensity/throughput through sustainable purchasing and waste management
• High degree of indoor environmental quality through daylight, ventilation, and indoor air quality
• The Student Centre Building Fee has accrued just more than $2 million since it began being collected.
• Envision Financial has stepped up to provide a $10 million mortgage for construction.
Funding model with the SUS securing a $10 million mortgage for construction:
$10 million from the SUS through the Envision Credit Union mortgage for construction
$5 million from UFV for construction
Ongoing funding from the SUS through Student Centre Building Fees accumulated since 2009 for outfitting the building (including ‘Campus Pub’), and operations.
• will be delivered, and in turn reported to the SUS membership, with a formal letter of approval from the creditor.
Plans for funding
The expected cost of the Student Centre Project as currently envisioned is approximately $15 million; the $10 million loan the SUS is taking, will be used for construction; $5 million in UFV funding will be used for construction; $2.8 million in accrued SUB funding will be used for construction and outfitting; Total expected funding directed toward the SUB will be approximately $17.8 million, and what’s left after the building is constructed, outfitted and operations begun will be used to initiate payback on the mortgage
UFV Student Union Society Building planned amenities
• A three-storey, 4,700-square-metre facility
• ‘Campus Pub’ in a 560-square-metre facility
• An approx. 600-square-metre multipurpose room for events and functions
• A new home for UFV student media – CiVL and the Cascade
• A convenience and used bookstore
• One-stop-shopping for UFV student services departments: Student Life, Career Centre, Alumni, Supported Learning Groups, Math and Science Study Centres
• Meeting rooms and Storage for Clubs and Associations
Student Centre Building financial info
• Student Centre Building Fee – $35 per semester – approved by Student Membership Referendum in the Winter of 2008.
• The original expectation was for a three-way funding partnership between your SUS, UFV and the Provincial Government for $5 million each.
• Financial realities saw the Province pull out of the project in early 2011, leaving the SUS and UFV to find alternative sources for the building construction costs. That’s where a lender comes in… currently UFV and the SUS are working with the Envision Credit Union to secure the funding.
The Architect’s Sketches of the UFV Student Centre Building:
INFO ABOUT THE $10M LOAN AS APPROVED AT REFERENDUM DECEMBER 2011
JUST TO BE CLEAR - This mortgage will NOT result in an increase in your student fees! The Student Centre Building Fee you currently pay with your registration was originally going to go to pay a lease to UFV; now it will go to pay the mortgage and operations of the building!
QUESTIONS stemming from ‘The Big SUS Question”:
1. Since student fees will not increase, will there now be a fee for SUS events? There will be no fees at SUS events that will be used to subsidize payments on the SUB, only potentially to help pay for the event itself if it is warranted.
2. Will the prices at the ‘Campus Pub’ increase to make up revenue needed for the mortgage? There will be no increase in pricing at the ‘Campus Pub’ to subsidize payments on the building. The ‘Campus Pub’ is intended to remain a separate business entity, so the surpluses or deficits of that business will benefit or damage the ‘Campus Pub’.
3. What is the length of the mortgage term? Most likely a 25-years amortization. That is the maximum according to Envision Financial.
4. What is the interest rate on the loan, and would it be fixed or variable? 4.25% fixed rate for 5 years ( which is a conservative estimate by Envision Financial ).
5. Is the SUS determined to seek financing through Envision Credit Union, or would it change financers if they could negotiate a better deal with a different institution? The amount of effort that has gone into getting us where we are with Envision would make us reluctant to switch, but if a suitable lender with significantly better terms could be found their offer would likely be entertained.
The SUS has actively sought financiers, with the guidance of UFV, since learning the original plan – $5 million from the building fee through the SUS, $5 million from UFV and $5 million from the B.C. government – was not going to be possible since the Government put an end to such funding and removed UFV’s ability to borrow money. Some institutions that approached or were approached by the SUS over the history of the search included Envision, RBC, different organizations within the B.C. government and at least one private organization.
Envision was the only group the SUS was comfortable with and who were able to provide the funding we needed. Most others were either unable to provide the necessary funding or were unwilling to.
In the end, the SUS has been through a search for a financier, and is now in the middle of an application process with Envision, that has almost come to fruition. It’s largely waiting for the result of the Referendum to finalize the agreement. The answers to Questions 1 and 2 are based on discussion with Envision.
This has not been a straight-forward financing application. As SUS doesn’t have a proven credit rating, and UFV is unable to guarantee the loan due to provincial government restrictions, the project is difficult for most financial institutions to consider. It has taken considerable time and effort to research the financing options available to us, and the SUS and UFV are pleased that Envision has come forward. It is unlikely that better terms could be negotiated for this project.
6. Have any documents been signed already agreeing to seek financing from Envision? No.
7. Why did the province pull out of the project in early 2011? They sent a letter at the time explaining that the debt to GDP ratio was outside their limit to support this project.
8. Is there still a possibility that the new building may need additional financing after receiving the $10 million? A very remote possibility is always there, but it is a possibility so it would be disingenuous to indicate otherwise; however the expectation is that at least some of the $10 million will go directly back to begin paying off the mortgage. Envision is requiring that the monies the SUS and UFV have allotted to the construction are used before their contribution is touched.
9. What is the expected annual payment on the $10M mortgage? The expected annual payment, considering a 4.25% fixed rate with 25 year amortizations is $650,000, or $54,000 monthly.
10. What are the expected operating costs for the building? The operating cost of the new building have been put to UFV’s Director of Campus Planning and will be added here as soon as available.
For any other info, contact SUS General Manger Meghan McDonald at email@example.com