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<\/p>\nUK university departments on the brink as higher-education funding crisis deepens<\/p>\n
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The modern university has become a competitive institution that seeks to attract the best staff and high numbers of students. To do that, they need buildings in which to teach, house their staff and students, conduct research and, increasingly, to make investments in, to collect rent from and to sell when times get tough. And times are hard for many institutions around the world. They therefore need to manage property and land portfolios \u2014 not just research budgets or staff salaries \u2014 with considerable care.<\/p>\n
In many cases, the academic mission itself demands new buildings. As Judith Squires, deputy vice-chancellor at the University of Bristol, UK, puts it: \u201cif you want to do cutting-edge artificial intelligence or cyber research, it\u2019s really hard to do that in an old Victorian building\u201d, which is the case for much of Bristol\u2019s campus. Modern universities need estates that are equipped for twenty-first century research \u2014 but many of their buildings were designed in the nineteenth century, especially in Europe and North America.<\/p>\n
As a result, university estates have grown far beyond classrooms and laboratories, evolving into complex investment portfolios in their own right. And it\u2019s big business: as of 2023, Columbia University was the largest private landowner in New York City. Among Harvard University\u2019s vast portfolio is a roughly 3,000-hectare vineyard in California. The University of Oxford\u2019s Merton College owns almost 6,000 hectares of land in the United Kingdom, making it one of the nation\u2019s biggest landowners. Not to be outdone, the University of Cambridge\u2019s Trinity College, the institution\u2019s richest college, owns the the lease for the O2 Arena in London \u2014 previously known as the Millennium Dome \u2014 which it bought for \u00a324 million (around US$32 million) in 2009. <\/p>\n
Keeping the lights on<\/h2>\n
Not every university has such grand, or varied, property holdings, but maintaining the portfolio is important, even if it\u2019s focused on appearing more attractive in the academic world. \u201cIf you\u2019ve got a hospital, you want to make it bigger. If you\u2019ve got a medical school, you want to make it bigger. If you don\u2019t have one, then you want one,\u201d explains LaDale Winling, an urban historian at the Virginia Polytechnic Institute in Blacksburg.<\/p>\n
Many universities have history to thank for their extensive portfolios. In the United States, the Morrill Land-Grant Acts of 1862 and 1890 transferred millions of hectares of federal land \u2014 much of it taken from Indigenous populations \u2014 to states to create higher-education institutions. These \u2018land-grant\u2019 universities, which include the University of California system, the University of Florida in Gainsville and Iowa State University in Ames, were intended to provide high-quality, affordable education to the public. <\/p>\n The vineyards that make up part of Harvard University\u2019s land holdings in California.<\/span>Credit: George Rose\/Getty<\/span><\/p>\n<\/figcaption><\/picture><\/figure>\n In the United Kingdom, the universities of Oxford and Cambridge had amassed their estates over centuries, but the Universities Tests Act of 1871 removed religious barriers to admission and academic posts, opening the institutions to new donors, students and investment, and fuelling a wave of late-Victorian expansion. Newer civic universities, such as Manchester, Birmingham and Leeds, were founded in the late nineteenth and early twentieth centuries with funding \u2014 and often land \u2014 provided by city authorities and industrial benefactors, as part of wider urban expansion.<\/p>\n At the University of Bristol, which currently owns around 350 buildings across the city, the need to buy and build is clear. Its \u00a3500-million Temple Quarter Enterprise Campus, set to open this year, was built to create innovative labs for digital technology and engineering research, bring the university closer to industry partners and local businesses, benefit from proximity to Bristol\u2019s transport links and make more space for staff and students. <\/p>\n Squires says that, fundamentally, the development is about enabling the institution\u2019s \u201cambitious strategy\u201d \u2014 particularly for research, because the university wants to move up in world rankings \u2014 so it is making sure it has \u201cthe best facilities for research\u201d, as well as the ability to meet the demands of today\u2019s students. \u201cWe wanted to design spaces that would facilitate collaborative work, across our engineering and business school for example, and we\u2019re seeing a lot of interest in our programmes in cyber security and data science,\u201d she adds.<\/p>\n Nick Hillman, director of the Higher Education Policy Institute in Oxford, UK, says that over the past decade, UK universities have built up extra infrastructure, and competition has driven that expansion. \u201cA lot of those shiny new buildings were about keeping up with the spending of universities in other countries,\u201d Hillman says. He recalls the University of Manchester\u2019s \u00a3350-million engineering complex, completed in 2021: \u201cThat\u2019s a phenomenal amount, but if you want to have a world-class engineering department, that\u2019s the money you have to spend.\u201d<\/p>\n In the United States, universities might still have to invest in construction, but they are often aided by their status as charitable institutions. The Ivy League universities \u2014 eight elite private institutions in the northeastern United States \u2014 have vast property portfolios, which are often tax-exempt. Yale University, for example, is the largest landlord in New Haven, Connecticut, according to a 2020 report from Reonomy<\/a>, a commercial real-estate data provider. The university also receives a $157-million property tax break every year as a non-profit organization. Yale makes voluntary payments in lieu of property taxes, but these are likely to be less than the tax-break savings, say critics.<\/p>\n Such holdings can push university development up against local people. New York\u2019s wealthiest private universities \u2014 particularly Columbia and New York University (NYU) \u2014 have drastically expanded their footprints while benefiting from vast property-tax exemptions that cost the city millions of dollars annually. A New York Times<\/i> investigation found that Columbia owns more than 320 properties, which together are valued at nearly $4 billion, with tax breaks worth over $182 million a year. <\/p>\n Why universities need to radically rethink exams in the age of AI<\/p>\n <\/a><\/article>\n<\/p>\n NYU, meanwhile, receives $145 million in annual exemptions. The scale of these tax breaks has intensified debate about whether universities behave more like private developers than civic actors.<\/p>\n This, Winling explains, is \u201ca fundamental tension that every [US] university community deals with. They draw on city services. They use city infrastructure, but they\u2019re not always paying taxes.\u201d Some cities negotiate \u201cpayment in lieu of taxes\u201d agreements, he adds, but it won\u2019t necessarily erase resentment. \u201cAll momentum is towards ever larger institutions, ever more diverse activities and ever more spatial and real-estate participation in local communities,\u201d he says. In response, the universities argue that the students they draw in to the city enrich the local economies.<\/p>\n As US president, Donald Trump has proposed removing universities\u2019 tax-exempt status \u2014 Harvard in particular, due to an ongoing disagreement with the institution \u2014 but doing so would probably require changes to federal taxation law, placing the move beyond direct presidential control.<\/p>\n Aside from local issues, university leaders have to consider that property can also become a financial drain. In the United Kingdom, when tuition-fee income and cheap borrowing swelled university budgets through the 2010s, higher-education institutions embarked on the largest construction boom since the Second World War in an attempt to attract more students. One analysis<\/a> found that between 2014 and 2019, UK institutions spent nearly as much on their estates as the entire cost of hosting the 2012 Olympic Games. The debt that funded that spree, along with rising interest rates, is now a weight that many struggle to carry.<\/p>\n The University of Nottingham\u2019s purchase and conversion of a former government building complex into a city-centre campus drew fire from staff unions after job-cut announcements in 2025. \u201cCastle Meadow Campus is a prime example of what\u2019s gone wrong in UK higher education,\u201d a spokesperson for University and College Union (UCU), which represents staff at higher-education institutes across the United Kingdom, told Nature<\/i>. \u201cUniversity management has poured almost \u00a3100 million into a new campus in the city centre to chase more overseas students, and now, as those students stay away, costs are being recovered through job cuts. UCU has been clear: universities should invest in people, not property.\u201d<\/p>\n PhD students face high risk of sexual harassment \u2014 can universities stop perpetrators?<\/p>\n <\/a><\/article>\n<\/p>\n The financial picture for English institutions has indeed reached a critical point: nearly half are facing deficits in the year ahead, according to the Office for Students\u2019 latest financial sustainability report<\/a>. With tuition fees not keeping up with inflation and fewer fee-paying international students to make up for it, university purchases such as Castle Meadow have become a problem.<\/p>\n A University of Nottingham spokesperson explained that the institution had \u201cbought Castle Meadow Campus at a time when the university had plans to grow and expand\u201d. Since then, \u201cthe financial landscape for Nottingham and the wider sector has changed\u201d, they said. \u201cOur strategic needs have changed. We no longer need to occupy as much space there. As a result, we are securing leases of surplus space to bring footfall to the campus and to generate rental income for the university.\u201d<\/p>\n Of course, not every UK university has struggled to make ends meet: Magdalen College, part of the University of Oxford, was able to sell its stake in the Oxford Science Park to Singapore\u2019s sovereign wealth fund for \u00a3160 million, which its president said was a \u201conce-in-a-generation opportunity to safeguard the College\u2019s future\u201d.<\/p>\n In Australia, too, the dual role of universities as education providers and property developers has shaped how institutions weather financial shocks. From the mid-1990s, reduced funding for domestic student places, research and infrastructure pushed universities to become \u201cself-financing institutions operating in competitive markets, actively seeking new sources of revenue\u201d, write urban geographer Kristian Ruming and housing researcher Sha Liu at Macquarie University in Sydney, Australia, in a 2024 paper2<\/a><\/sup>. Those lucrative enrolments surged in response: between 2010 and 2019, the number of overseas students at Australian universities grew by 56%. \u201cIn this context, universities have looked to leverage property and exploit market opportunities to both generate income and reduce costs.\u201d<\/p>\n Then came the COVID-19 pandemic. Border closures triggered a 10% fall in fee income across Australian institutions in 2020, exposing how reliant many universities had become on international-student revenue to service debt. Meanwhile, the rapid shift to hybrid learning left newly built lecture theatres underused. <\/p>\n Analysts now warn that with enrolments flattening, universities might have to reassess the size and purpose of their estates \u2014 in 2021, the University of Sydney sold Aus$100 million (US$75 million) of property, while the University of Technology Sydney sold three accommodation buildings for an estimated Aus$95 million.<\/p>\n<\/div>\n![\"Lines](\"https:\/\/media.nature.com\/lw767\/magazine-assets\/d41586-025-04167-1\/d41586-025-04167-1_52015204.jpg?as=webp)
Private landowners<\/h2>\n
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<\/p>\nBoom and bust<\/h2>\n
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<\/p>\nPandemic precautions<\/h2>\n