JLL helps Purdue University solve its real estate challenges

Purdue University, ranked as one of the ten most recognized universities worldwide, is a public research institution committed to delivering excellence at scale across their real estate portfolio of more than 20 million square feet. To support their goals to drive innovation and enhance their physical plant, Purdue needed external real estate experts to help them plan, optimize, manage and deliver a variety of strategic real estate initiatives.

In 2017, after a competitive procurement process, JLL was selected as their exclusive real estate advisor, providing a broad range of real estate services to the university, and helping them navigate complex challenges and implement large-scale solutions.

Purdue University was facing a significant on-campus student housing shortage due to unprecedented enrollment figures and high demand for on-campus housing. At the start of the 2018 academic year, there was excess demand requiring some undergraduate students to be placed in apartment buildings.

To obtain 1,300 new beds as soon as possible by the 2020 academic year, Purdue pursued a Public-Private Partnership (P3).

It was determined that the University needed 1,300 new beds as soon as possible, and no later than the start of the 2020 academic year, which is far shorter than the average time to construct student housing. The University pursued a Public-Private Partnership (P3) for the design, construction, financing, operation and maintenance of the new beds on campus, because it was the best approach to meet their key objectives of quick delivery, student affordability and lifecycle maintenance of the assets.

Purdue engaged JLL to provide advisory services for nearly every aspect of the P3 because of their experience and proven success with these financial structures. The JLL team advised with nearly every aspect of the project, including reviewing the Request for Proposals (RFP), setting technical specifications, evaluating developer proposals, qualifying development firms and engaging in negotiations and selection.

Due to this partnership, the project reached financial close just 8 months after the release of the RFP and arrived at a final project scope to provide two on-campus housing facilities comprising 1,300 beds for delivery in July 2020. It was the first standalone student housing P3 structured as an availability payment Design Build Finance Operation Maintain (DBFOM), meaning that Purdue was able to occupy the space during the payment period, and could reduce payments if the developer did not meet the terms of the agreement.

“As Purdue’s exclusive real estate advisor since 2017, JLL has been a trusted partner for us and has always delivered.”

Purdue engaged JLL to lead the solicitation and procurement process for a transformative renovation of Purdue’s Memorial Union ground floor retail dining area and a partner to operate their entire retail dining portfolio of 30 current retail locations and five future locations. JLL supported the University at key stages of the process by performing a detailed financial analysis of the proposed partnership demonstrating the financial implications to the University. In conjunction with Purdue’s procurement team, JLL led the solicitation process and drafted an RFP for the opportunity, then generated market interest for the opportunity by conducting marketing sounding calls with potential partners. JLL evaluated proposals and helped Purdue negotiate the deal with the selected private partner, which closed in the Spring of 2020. The transaction resulted in a significant upfront payment from the partner to the University that would fund a large portion of the required renovation, as well as an ongoing revenue sharing arrangement to provide a stable source of income to Purdue.

JLL also supported Purdue on the Purdue Memorial Union hotel management agreement after a donor made a significant contribution to support renovations to the hotel. JLL reviewed the hotel management agreement and advised on key business terms helping the university finalize the agreement in alignment with the best interests of the University.

Most recently, JLL helped Purdue reimagine how to support their employees working remotely and provide more value for employees coming into the office. Purdue’s The Future of Work Project Team partnered with JLL to initiate the reinvention process and together engaged faculty, staff and students to help develop new strategies to reinvent work experiences and advance a new work process. Purdue chose to work with JLL because of its reputation as a leader in providing innovative approaches to workplace strategy and design. Together the teams are creating a workplace that enhances the value of coming into the office, provides a better and more relevant work experience for those working in a remote or hybrid position, and optimizing the real estate portfolio to bring efficiencies and cost savings to bear.

“As Purdue’s exclusive real estate advisor since 2017, JLL has been a trusted partner for us and has always delivered. The team brings technical and financial experience, market intelligence and private sector relationships that we regularly lean on and their consistent high performance has led us to continue to engage them on new initiatives,” said Robert Wynkoop, vice president for auxiliary services at Purdue University.

JLL continues to be a trusted real estate advisor for Purdue University, consulting on matters including lease/purchase analysis and execution, occupancy planning, lease administration, real estate options analysis and transaction strategy, and a number of other consulting projects on an as-needed basis. As a trusted real estate advisory partner, JLL always has Purdue’s best financial interests at heart and helps their teams quickly and confidently find the best solutions to support their goals.