Colleges Inviting Businesses Onto Campus

At Cal State Northridge, officials are banking on an upscale, Mediterranean-style shopping center beside the football stadium. Cal State Fresno envisions a truck stop, of all things, on a 69-acre plot where agriculture students once harvested wheat. Cal Poly Pomona hopes to collect greens fees from a nine-hole golf course.

Squeezed by budget cuts and recession, and criticized by capitalists as financially uncreative, California’s public colleges and universities are going commercial--inviting private, for-profit developments onto campus.

Cal State Northridge hopes to reap $1 million a year by leasing 20 acres for the shopping center, a project that could get final city approval by the end of the year. Fresno hopes to pull in that much by providing gas, food, lodging and other services by the local highway. Pomona isn’t sure how much it will make from its golf course, but figures that it will be enough to fund new botanical gardens and enhance the school’s general coffers.

Professors and students are not altogether comfortable with the dollar-driven agreements, worrying that their institutions may be pawning a piece of their academic souls. And neighbors complain that they settled down next to ivory towers, not office towers.

But most educators agree that such partnerships are only going to increase at a time when public funding falls short of their needs. The challenge, they say, is to preserve the educational environment of a campus as multiplex movie theaters move in.

“We want to do it in a way that’s not incompatible with what the university already is,” said Jim Goss, president of the Cal State Northridge faculty and chairman of the religious studies department. “But where’s that line? That’s the question.”

Traditionally perceived as above the business of business, public colleges and universities in truth have long earned money in the private sector, from marketing their scientists’ research to licensing the Bruin logo at UCLA.

But there is a growing emphasis on using campus land to bring in dollars. While a university might still partner with a biotech firm to build an on-campus research lab, it may just as well sign up a corporate headquarters or other “revenue-generating kinds of development,” said Richard West, senior vice chancellor for business and finance for the California State University system.

The CSUN mall, the subject of public hearings in Los Angeles, is a prime example of the finance-focused development being promoted by Gov. Pete Wilson, CSU Chancellor Barry Munitz and others who say that heavily subsidized institutions must begin paying their own way.

CSUN President Blenda J. Wilson also has supported the proposed University MarketCenter, a 220,000-square-foot shopping complex near the school’s football stadium. Like a dozen other projects being planned or built on campuses throughout the state, the MarketCenter would seek business not so much from the university community as the surrounding suburbs, luring shoppers with a fashionable grocery store, a latte-serving coffee shop and a computer electronics outlet, among other tenants.

Although Wilson and CSUN’s consultant on the project, Frank B. Wein, have promised internships, meeting space and other opportunities for educational experience--in marketing, for example--they have had to fight the skepticism of students. Last fall, the student senate defeated a resolution supporting the project and last week a campus referendum went against it 829 to 526.

“The academic tie-in--that’s where the university has failed to make the connection,” said Student Body President Vladimir Cerna, who otherwise supports the development.

No direct connection to education is required under state law, as long as profits are spent on academic programs. But, mindful of their mission and public image, all the institutions are trying to retain an academic aura, although some are dimmer than others.

The Cal State Fresno project, still in the talking stage, would plow under the 69 farm acres and develop some of the property, near California 168, with “freeway-oriented” businesses--service stations, fast-food restaurants and perhaps a motel. Other acreage may be reserved for housing for the elderly, to be overseen by the school’s gerontology program, and perhaps recreation.

At Cal State Dominguez Hills, preliminary plans call for including a “science education center” and low-cost student housing in a 75-acre development that will bring in cash through chain restaurants, a movie theater and shops.

Dominguez Hills already is home to one of the quirkiest developments on a CSU campus: a Kubota lawn mower research-development complex. Extending few overtures to its academic neighbors, the six-acre Kubota site is ringed with barbed wire and discourages visitors with a sign that says, “No trespassing, no cameras.”

Cal Poly Pomona, meanwhile, has begun talking to golf course architects about the best way to lay out nine holes on 339 university acres, which also will feature the botanical garden. Students studying landscape architecture, turf-grass production and other agricultural specialties would help plan, construct and maintain the course.

“We think we can have both the academic connection and generate some revenue at the same time,” said Ed Barnes, director of Pomona’s LandLab, developer of the project, which has no firm price tag yet. But, he acknowledged, “The reality is, we wouldn’t pursue the golf course if it was not going to generate some revenue. The California State University is under tremendous pressure to start to offset some of its operating costs.”

In California, what better way to do that than by developing unused real estate?

The most extreme example is seen in plans to create a Cal State Channel Islands campus at the site of Camarillo State Hospital in large part by finding commercial uses for the surrounding land.

And with a few exceptions--the most notable being cramped UCLA, which nonetheless has the most profitable university store in the nation--existing state colleges and universities have more campus than they know what to do with. In many cases, dozens or even hundreds of acres won’t be tapped for new classroom buildings or student unions for decades.

At Cal State Northridge, Wilson noted that when safety inspectors closed dozens of campus buildings after the 1994 earthquake, “We had enough additional land to put up 480 trailers and 14 domes.”

Some private universities have long subsidized learning with selling. The Harvard Coop has sold clothes, books and crimson sweatshirts to generations of students and the public. Stanford is trying to expand its equally popular Stanford Shopping Center, which already houses more than 140 stores and restaurants.

There are long-standing examples of such development on public campuses, as well, including a shopping center at the University of Wisconsin at Madison built in the 1960s.

But the number of projects at public institutions has spurted only recently, as tuition costs have risen and public support has waned, said James E. Morley Jr., president of the National Assn. of College and University Business Officers.

“As usual, California is leading the way,” said Courtney Caldwell, senior vice president of Newport Beach-based MPC Associates Inc., one of the few firms in the country specializing in campus real estate development. “California was pretty hard hit by the recession, and higher education was really hard hit.”

Cal State Fullerton provided a precursor to the trend in 1988 with its six-story Fullerton Marriott hotel, built after a battle with traffic- and noise-fearing neighbors. The complicated deal enabled the school to build a sports complex on one section of the campus with donated funds and loans from the city of Fullerton--loans that the university will repay with income from leasing the land to Marriott.

“Other universities looked at that and said, ‘That looks like a good idea, let’s try that,’ ” said Cal Hollis of Los Angeles-based Keyser Marston Associates, which is helping plan Fresno’s development.

Among the university projects floated back then was one for a $200-million housing and retail complex at Cal State Northridge.

But the timing was not right. Just as the Fullerton Marriott was being built, the California economy and real estate market were collapsing. Campus projects such as Northridge’s bit the dust.

Now, as the state’s economy has rebounded, so have the development plans. And there’s added impetus--rising tuitions.

Although the cost of attending a California public college is still low when compared to schools nationwide, tuition has doubled in the Cal State system in this decade, to the current $1,584 a year.

Without the private fund-raising abilities of the more prestigious UC schools, Cal State officials have turned to the planned stores, theaters and other projects as a way to hold tuitions in check.

The proposals invariably draw opposition, including the kind heard above the din of any large construction project: concerns about traffic, late-night noise and increased crime. But other gripes are more original.

A coalition of San Fernando Valley businesses opposes the Northridge project, alleging, among other things, that the university is encouraging unfair business competition. As taxpayers, they say, they are part owners of university land that might soon house businesses that compete with their own.

Wein, the university’s consultant, calls that nonsense. Any competition will be fair, he says, because the developer, Newport Beach-based Hopkins Real Estate Group, will rent out the space at market rate and not a penny less.

While PR-conscious developers have proved adept at overcoming disgruntled neighbors at several campuses, they still face questioning by students and educators.

At Northridge, some point out that the $1 million a year the school expects to earn represents well under 1% of its $163-million annual operating budget. Is that enough, they ask, to justify giving up the land for 99 years?

But supporters also play the dollar game. To generate an equal amount, they note, student fees would have to be raised more than $30 per year. Increases as low as $5 have been voted down by students in the past.

At tiny Mission Community College in the Silicon Valley city of Santa Clara, some wonder what happened to the romantic idea of the campus as an island, separated physically as well as intellectually from the outside world.

Part of the campus is home to the headquarters of S3 Corp., a high-tech firm. On another plot, a 24-screen AMC theater complex is under construction. When fully developed, the projects will generate $1.7 million a year for Mission and a sister college.

But there’s a cost that has some pondering whether it’s worth it. From some vantage points, it’s hard now to tell the place is a college, said Mission’s Academic Senate President Don Cordero.

“There’s a tension that we haven’t resolved yet--between [getting] money . . . and considering ourselves stewards of land that was originally given for educational purposes,” he said. “It’s so new that we don’t know yet.”