Through the Roof: 26th Annual Official Education Construction Report

A robust economy and renewed interest in school facilities sparked a flurry of education construction spending in 1999. The nation's schools and universities completed a record amount of construction last year-topping $30 billion-and administrators are optimistic that the next three years will result in even stronger spending.

A sharp rise in college construction fueled the record spending, with school districts posting smaller-yet still substantial-expenditures than the unprecedented amount of construction they put in place in 1998, according to American School & University's 26th annual Official Education Construction Report.

The amount of college construction put in place approached an astounding $14 billion in 1999. Construction spending on new college buildings exploded to $8.46 billion, doubling the amount put in place in 1998. Colleges had a record number of buildings completed in 1999 to house the growing number of students entering their institutions and in preparation of the projected future enrollment boom.

Getting results To arrive at results for the 26th annual Official Education Construction Report, a detailed questionnaire was mailed in December 1999 to chief business officers at the nation's school districts and colleges. Basically, it asked two questions:

-Did you complete any construction during the past year?

-Will you complete any construction in the next three years? Administrators answering "yes" to either question were then asked to provide a variety of details on the amount being spent, the type of construction being done (new, addition or modernization), and the expected completion date. All respondents involved with new and retrofit construction were asked to provide additional information on each project. Responses were separated by institution type, region of the country and institution size, and projected across the education universe.

Spending patterns The record $30 billion in construction completed in 1999 represented a 23 percent increase over the previous all-time high posted in 1998. Spending increases over prior year's figures were reported across the board in new facilities, modernization and retrofit, and additions to existing buildings.

As a percentage of all education construction spending, modernizing and adding to existing buildings accounted for 52 percent of the expenditures. Educational institutions spent close to $8.53 billion on modernization projects and $7.04 billion on additions in 1999. Slightly more than $14.43 billion was spent on totally new construction.

School districts accounted for the majority of total education construction spending. Approximately $16.04 billion worth of construction was completed in 1999, a 6 percent decrease from the unprecedented amount put in place in 1998. While school district construction dropped slightly from its all-time high the year before, the $16.04 billion in projects completed was the second largest amount ever posted.

Additions and modernization of existing schools made up approximately 63 percent of the spending. In 1999, public school districts spent $5.07 billion on additions and $5.00 billion on modernization and upgrades. The amount of new school construction completed in 1999 totaled $5.97 billion. While numerous new school construction projects were in progress during 1999, this survey only reports total dollars spent on "completed" projects. Therefore, only those new buildings that were open and ready for occupancy for the year are included in the totals. This methodology has been in effect since the inception of this survey and ensures that construction spending is not duplicated from one year to the next.

The amount of college and university construction put in place in 1999 skyrocketed. Reversing a decrease in spending reported in 1998, higher-education institutions completed a record $13.96 billion worth of projects last year, with new facilities accounting for roughly 61 percent of the spending ($8.46 billion). The remainder was split between modernization projects ($3.53 billion, or 25 percent of the total) and additions to existing buildings ($1.97 billion, or 14 percent of the total).

Colleges and universities took advantage of a healthy economy to prepare for a growing influx of students, and a demand for more high-tech facilities and accommodations. College enrollment peaked at 14.7 million last year, and the number of full-time students is projected to swell to more than 16 million in 2008.

A Look Ahead Educational administrators at both school districts and higher-education institutions are optimistic about future spending on facilities. Total education construction expenditures over the next three years (2000-02) are projected to top $107 billion. Construction activity is expected to skyrocket by more than 50 percent over projections made by administrators in last year's survey.

Approximately 70 percent of the anticipated construction spending will be done by school districts, which expect to put in place $74.54 billion worth of construction over the next three years. Approximately 52 percent of the money will be for new construction, which is a turnaround for school districts as modernization and retrofit typically account for more than half of the spending. The remainder of the dollars will be split fairly evenly on modernizations and additions to existing buildings.

School construction is gaining increasing support. And as evidenced by the amount of construction administrators expect to complete over the next three years, the support is being backed up by dollars.

Colleges and universities, while still projecting healthy construction activity through 2002, do not expect to post the astounding numbers reported in this year's survey. Approximately $32.51 billion worth of college construction will be put in place over the next three years, of which 68 percent will be earmarked for totally new facilities.

Modernization spending will reach $6.04 billion (18 percent of expenditures), while additions to existing buildings will top $4.51 billion (14 percent of expenditures).

The past three or four years of rapid growth in education construction spending is evidence that school districts and colleges are having some success in addressing myriad space and facilities needs. The current growth in construction expenditures dwarfs even the rapid expansion in spending seen in the early 1990s.

The Regional Picture Data are broken out by school districts, colleges and universities, and all education.

Almost two-thirds of all education construction completed in 1999 took place in four regions of the country: Region 5 (Great Lakes states), Region 9 (South West), Region 2 (New Jersey and New York), and Region 4 (South East).

Four regions were also responsible for almost two-thirds of all construction at school districts in 1999. Besides Regions 5, 4 and 9 repeating their feat, Region 6 (South Central) accounted for the second highest expenditures by school districts ($1.98 billion). These same four regions also were responsible for the majority of the school construction in 1998, illustrating the tremendous amount of activity taking place in these areas.

Certain regions of the country also were more active than others in regard to college and university construction. Three regions-5, 2 and 9-accounted for 56 percent of the college construction spending in 1999.

The most active construction region in 1999 was Region 5, completing $9.31 billion worth of education projects. Following Region 5 is Region 9, putting in place a healthy $3.43 billion in school and university construction. Rounding out the top five most active regions are Region 2 ($3.19 billion), Region 4 ($3.13 billion) and Region 6 ($2.67 billion).

Spending is broken out by region of the country, type of spending, and percentage of dollars allocated to new facilities and additions/modernizations. Only three regions (4, 7 and 9) spent a larger percentage of their construction dollars on totally new buildings. The majority of the regions spent more adding to and modernizing existing buildings.

The same three regions (4, 7 and 9) that spent more than half of their construction dollars on totally new facilities in Table 5 also did so at the school district level. The remaining seven regions spent the majority of their school construction dollars adding to and modernizing existing buildings. Regions 1, 2 and 5 spent more than two-thirds of their dollars in this area.

More than half of the regions spent a larger percentage of their construction dollars on new facilities. Regions 1, 2, 4, 5, 6 and 7 put the bulk of their dollars toward new buildings, as opposed to adding to or modernizing existing facilities.

Where the activity will be Administrators expect to complete more than $107 billion worth of construction over the next three years. Almost 50 percent of all education construction will take place in just three regions of the country. Regions 5, 4 and 2 expect to put in place $51.76 billion in projects. Region 5 will be the most active construction region, projecting to spend $22.57 billion. The next most active region will be Region 4 ($16.36 billion) followed by Region 2 ($12.83 billion).

More than $74.5 billion worth of K-12 construction is anticipated over the next three years. The same three regions (5, 4 and 2) that will be doing the majority of all education construction also are expected to do the bulk of all school construction (48 percent). More than half of the dollars projected to be spent over the next three years on school construction will go toward totally new facilities (52 percent). Eight of the 10 regions will spend more on new construction; only Region 2 and Region 9 will spend more of their dollars on additions and modernizations. This is a turnaround from years past, when additions and modernizations accounted for a majority of K-12 construction spending.

More than $32.5 billion in projects will be put in place over this time. Regions 4, 5 and 6 will be doing the majority of higher-education construction (approximately 52 percent). New construction will be the dominant form of construction in every region of the country through 2002.

As mentioned in prior surveys, both school and university administrators historically have underprojected the amount of construction expected to be completed in future years, often by double-digit percentages. So, if anything, these figures should be considered very conservative.

Calculating Costs -The median new public elementary school is constructed for 610 pupils, provides 115 square feet per student, and costs $118.81 per square foot for a total price of $9.2 million. At an average size of 65,379 square feet, it contains 30 classrooms.

-The median new public middle school is built for 800 students, provides 130 square feet per pupil, and costs $126.86 per square foot for a total cost of $14.3 million. With 36 classrooms, the average size of the typical middle school is 119,000 square feet.

-The median new public high school accommodates 804 students, provides 153 square feet per pupil, and costs $139.48 per square foot for a total price of $21.4 million. At an average size of 135,559 square feet, it contains 35 classrooms.

It is more expensive to build an elementary school in Region 2 than in any other region ($11.80 million). Middle schools cost the most in Region 5 ($15.36 million) and high schools are the most expensive to build in Region 3 ($29.13 million).

Region 6 reports the lowest cost of a median new elementary school ($5.84 million), while it costs less to build a middle school in Region 8 ($8.56 million) and a high school in Region 4 ($10.33 million).

Among regions reporting the highest costs per student include Region 2 (elementary schools), Region 5 (middle schools) and Region 1 (high schools). Region 9 has the highest median cost per square foot for all three types of schools.

Region 7 provides the most square feet per student in elementary, middle and high schools. Region 3 builds the largest elementary and high schools, and puts more students into those schools. Other highs were reported in Region 4 (median number of pupils in new middle schools) and Region 5 (median size of new middle schools).

The lowest costs per square foot and per student for new elementary and middle schools were reported in Region 6, while Region 4 had the lowest costs per square foot and per student for new high schools. Region 9 offers students the least square footage across all levels of new K-12 facilities, and builds smaller elementary, middle and high schools than other regions.

Information on new schools completed in 1999 is compared with data from 1997 and 1998 to help identify trends.

Of particular interest is the growth of computer centers and library/media centers in new elementary and middle schools over the past few years. Fewer new high schools, however, feature these facilities. One possible reason is the trend to more individualized workstations, use of laptop computers and internet use among high-school students.

The days of building new schools without air conditioning are history. Almost 88 percent of space in new elementary schools, 84 percent in new middle schools, and 83 percent in new high schools is air-conditioned. Colleges and universities air-condition 91 percent of their new space.

While air conditioning continues to be prominent in new education construction, the amount of space carpeted continues to decline. In new elementary schools, the use of carpeting dropped to 49 percent of the space from 54 percent the year before. The amount of space carpeted in new middle schools dipped to 39 percent from 47 percent reported in last year's survey. High schools carpeted slightly more of their space than the year before, covering 33 percent compared to 30 percent last year. Colleges and universities report carpeting 45 percent of their floors, down from 46 percent the year before.

The Retrofit Picture It is important to remember that comparing data on retrofits can be extremely difficult, at best, because each institution's project is so different. For example, one school may consider repainting and carpet replacement as a retrofit, while another may only consider a total building modernization as meeting the requirement. Your retrofit costs may vary greatly depending on the size, scope and type of project, as well as in which region of the country you are located.

The typical K-12 school retrofit entailed upgrading 44,000 square feet of space at a total cost of $632,500. Cost per square foot was $40 and cost per student was $1,267.

While colleges and universities spend more per typical retrofit than schools ($59 per square foot for a total cost of $1.05 million), they typically retrofit about half of the space K-12 institutions do (22,500 square feet compared with 44,000 square feet at schools). Colleges spend approximately $1,100 per student for a retrofit.

Both schools and universities report HVAC, lighting and electric improvements as the most often performed retrofit projects. During technology infrastructure upgrades, all education institutions most often install Category 5 cabling, with fiber optics also proving to be extremely popular.

While air conditioning continues to be prominent in new education construction, the amount of space carpeted continues to decline, according to American School & University's 26th annual Official Education Construction Report. The incidence of air conditioning and carpeting in educational facilities:

-Elementary schools air-condition 88 percent of their new space and carpet 49 percent of their floors.

-Middle schools air-condition 84 percent of their new space and carpet 39 percent of their floors.

-High schools air-condition 83 percent of their new space and carpet 33 percent of their floors.

-Colleges and universities air-condition 91 percent of their new space and carpet 45 percent of their floors.

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