The Hidden Real Estate Crisis in Higher Ed With Chris Morett PHD – RFP 75 Transcript
Gordon Lamphere (00:06): Hi, I’m Gordon Lamphere, and welcome to The Real Finds Podcast, where we have real conversations with key entrepreneurs, activists, and researchers shaping the real estate industry and, as a result, our world. On today’s podcast, we’ll be speaking with Chris Morett. He’s the former director of scheduling and space management at Rutgers University and president of Cohere, a campus and workplace consultancy. On the podcast, we discuss how the demographic cliff won’t hit all schools equally. Chris highlights signals investors can use to track enrollment trends, endowment and housing dependency, and research intensity, so they can separate flagship universities from at-risk regional campuses. He then connects those signals to opportunities in student housing, third-party labs, and mixed R&D. If you’re a broker, investor, or developer trying to understand how the world of academia shapes the world of commercial real estate, today’s episode is well worth a listen. Chris, thank you so much for hopping on the podcast today.
Chris Morett (01:23): It’s a pleasure to be here. Thanks for having me.
Falling Into Space Management at Rutgers
Gordon Lamphere (01:26): What got you started in the world of higher ed and higher ed real estate?
Chris Morett (01:31): I started in higher ed in a different lane, you could say. I was teaching, and I got into real estate and space management entirely by accident. I applied for a job at Rutgers University, got the interview, and it went great, but I didn’t get the job. Then another job came up at Rutgers. I didn’t have to work there, even though I’m an alum, but it looked like an interesting job, and I was interested in moving into administration. I applied and interviewed with the same group of people within this huge university, and that went really well too. I thought, “That’s probably a good sign. Why else would they have me back for a second interview for a second job?” Then a week went by, and I got a rejection letter in the mail. But at the bottom was a handwritten note: “We’d like you to think about this other job. We think you’d be a good fit.” That was the director of scheduling and space management at Rutgers.
I did that for ten years, and it was great and so interesting. I had an amazing staff, which freed me up to do more strategic work. Partly because of my previous background, and partly because I didn’t have to put out fires every day, I really got to immerse myself in the university. That was my inclination. Why wouldn’t I go to a brown-bag talk on some topic now and then? And I think that made me an effective space person, because I really knew the institution well. Now that I’ve moved into consulting, it may sound easy, even pithy, but mission-driven spaces are important, and as we know, they often aren’t what comes out of the design process. That’s how I got in, and I think it shaped how I approach the work.
Why Campus Space Goes Underused
Gordon Lamphere (03:20): I’d love to talk more about that. I have a couple of friends from law school who ended up in academia, and some in academic real estate. Many of them have told me privately that there’s often a real chasm between effective utilization in theory and how it plays out on campus. Why do you think classrooms, labs, and other academic spaces are so often underutilized?
Chris Morett (04:00): First, I’ll say what I often say: I consider myself a defender of higher ed, in the sense that I think it’s often unfairly attacked. And believe me, my job is to help it become more efficient and have more impact, 100 percent. Every sector should be running toward the future and away from the past. But I do think higher ed gets an unfair amount of criticism, as if it should have solved social inequality with deep historical roots. So I have to give that caveat, because I wouldn’t want to provide fodder for someone who makes a game of scalping higher ed leaders.
That said, I’d divide the reasons for inefficient space use into two, though it may be a bit of a false dichotomy. The first are understandable reasons. Not every course will fit perfectly into a classroom. Your course schedule and section sizes won’t match your classroom inventory hand in glove. Sometimes you have to put a 20-person course in a 50-seat classroom because all the 25-seat classrooms are taken, and that means poor seat occupancy. There are also real constraints on the part of, say, an adjunct professor teaching at three institutions, or a parent. Or a bigger room may have better technology, so you put a smaller class in it. Those are all on the more valid side of the ledger.
On the other hand, I think you see a little too much,
Chris Morett (05:53): and I want to say this is decreasing, but it’s more accepted than it should be, when faculty or deans say, “We don’t want to teach after three o’clock or before ten, and that’s what our students want.” It may be what those students want, but what about the night students, or students who don’t attend your institution yet and haven’t been surveyed? Some of them might be better served at night. So that’s part of it.
Another reason is that a classroom can either be centrally scheduled or controlled by a department, and centrally scheduled classrooms are always better utilized. When I was at Rutgers, we did a lot of benchmarking against the Big Ten, and the institutions with the best classroom utilization had a higher percentage of centrally managed classrooms. I’ll leave it at that. I already went on too long because I couldn’t find the word I wanted.
Public vs. Private Institutions
Gordon Lamphere (06:53): I think it’s underutilization, too, and I’m not picking on universities. We’ve had at least five podcasts on underutilized office and industrial space. That’s not what I’m doing here. I’m curious how universities compare to private-sector businesses. Where are your pain points compared with the private sector?
Chris Morett (07:25): I appreciate that question, because underutilized space really is unacceptable. In an environment where higher education is dealing with budgetary crises, and trying to make sure students have the funds they need to attend college, wasted space is actually pretty unethical, and certainly operationally pretty bad. So you’re asking about the pressures and how they compare?
Gordon Lamphere (07:55): Yes.
Chris Morett (07:56): One thing: comparing private to public institutions is difficult because privates are smaller, so there’s a scale issue that confounds some of the differences. Privates also split into very wealthy institutions and ones that aren’t, and all else equal, the wealthier the institution, the less pressure there is for space efficiency. Whereas at publics, you might see campuses so crowded with students that it actually pushes them toward more efficient classroom utilization, because there’s no other choice. So my point is that there’s no single answer, because all these factors are swirling around. Is there an accountability difference between private and public? Maybe, but that’s layered on top of all the other differences.
Ownership, Incentives, and Information Asymmetry
Gordon Lamphere (08:56): Speaking of accountability, one of the biggest factors is incentive structures. How do the incentives play out for independent property owners versus universities?
Chris Morett (09:13): Broadly and historically, although there’s some movement here, higher education institutions own nearly all their space. There are tons of exceptions, and I’m not getting into things like P3s, but most own most of their space. A company, on the other hand, has a lease that comes up for renewal, and even a long-term lease of ten years is a lot shorter than 500 years. That means space efficiency has less of a real-dollar payoff in the short term at a university than at another organization, and shockingly, that drives different behavior.
I’ve learned from doing podcasts, including my own, that you can’t be too systematic in your answers, or they become mind-numbing and long. But another thing I’d throw out there is information asymmetry, especially in classroom scheduling, but also in research labs. Say I’m the researcher and you’re the provost or the head of space. You can’t know exactly what I need. Gathering data helps, and good relationships help, but at a large university, so many different people are doing so many different things in their labs. Or say you go to the dean of the School of Arts and Sciences, and they say, “We can’t teach these classes at night. These professors just can’t do it.” Some of them really can’t. They have a newborn, a sick parent, a medical issue, or a disability you can’t see. But you don’t know which ones. So how do you go to the mat on that, on top of everything else you have to do?
That information asymmetry is huge, and I think we should work against it. It’s one of the most fundamental forces at play. Going back to a private company, is there as much information asymmetry? Are the tasks as hard to see and as differentiated as at a university? I’ll say, with a little hesitation, that they’re not, unless you’re talking about a biotech company or something similar.
Will Universities Lease Space, or Lease It Out?
Gordon Lamphere (11:31): One big difference you touched on is ownership. Universities tend to own their buildings for a variety of reasons, often tax-related, since under the current tax code it doesn’t make much sense for nonprofits to lease from for-profit landlords. How does that generally play out? Do universities ever lease space, or lease space out, or is that rare?
Chris Morett (12:05): That’s a great question, and whatever the answer is now, it will change because of what’s happened over roughly the last five years, on top of some long-term trends. With the pandemic, we saw the rise of hybrid work. Many of us, maybe twenty or twenty-five percent of the workforce, not counting people who must work in person, like construction workers and nurses, and twenty percent of the economy is a huge chunk, now have a different orientation toward space. It’s possible not to go into the office. It’s possible to spend two weeks working from an Airbnb somewhere just for a change of pace. That can be negative too, because you can’t take a real vacation when you can still log in. But there’s a changing orientation between people and space, and between geography and space. We still don’t know how migration between regions and metropolitan statistical areas, to use a census term, will be shaped by remote and hybrid work. Maybe college graduates will work remotely for a year or two before they move. That would have tremendous impacts on the whole real estate market and every affected metro. These are fundamental changes.
That means real estate strategy will change in ways we should be discussing, though nobody can claim to know exactly how. And sometimes it still makes sense for a university to lease. It’s quick and easy. Maybe that rented space in a local office building comes with custodial service and a promise to redesign it before you move in. Depending on how a university’s finances work, if individual colleges have some control over their budgets, they may say, “This is worth our time and our struggle to go rent a floor.” So there are real decision points that occasionally push toward leasing, even when, at the big-picture level, you’d ask, “Why are you leasing that? We’ve got space over here.”
Chris Morett (14:25): And the answer could be, “Because it was easier.” Whether that should be allowed is a different question. There’s also swing space, and so on. But if universities start taking advantage of technology, the new mindset around space, and the growing social acceptance and practice of shared space, and make some investment, which is of course the sixty-four-thousand, or sixty-four-million, dollar question, they can capture some of what they got from leased space. I don’t mean to oversimplify.
In the other direction, will universities lease their space out? I think they could. Consider urban versus rural institutions. In urban areas, you can imagine more potential tenants, and universities could lease smaller chunks, a floor or a suite, simply because they have real estate available. Or it could be more mission-driven. I keep thinking of Rutgers, where Johnson & Johnson is also located. I don’t actually know whether this is happening, because both are such big institutions, but what if some J&J folks had office space in the chemistry building? That’s a more purpose-driven arrangement. There are already tons of community-university-corporate partnerships, and maybe space becomes more of a part of them.
Incubators and Innovation Centers
Gordon Lamphere (16:03): We’re definitely starting to see that in Chicagoland. Rosalind Franklin University, which I have a pretty good relationship with, has an incubator space, and several startups have spun out of it. And at the University of Illinois Chicago and the University of Chicago, a lot of incubators are locating right next to those research clusters. Are you seeing that broadly across the nation as a trend?
Chris Morett (16:36): I think so. For a geographically different example, look at North Idaho College. Its president, Nick Swayne, whom I know fairly well, came from James Madison University, where he started something called JMU X-Labs. People should look it up. I won’t try to describe it, but it was a very innovative, often community-facing resource at the university. He went out to NIC as president, and they’re standing up an innovation center that’s extremely community-oriented. He’s out there saying it’s great for workforce training and will be a hotbed for collaboration and for the community, maybe even for community members coming in for incubation, though I shouldn’t speak for Nick. This is in Coeur d’Alene, Idaho. I use that example because you expect it in Philadelphia, New York, or Chicago, with so many people and so much pressure, but it’s happening even in Idaho.
Urban vs. Rural Campuses
Gordon Lamphere (17:43): You mentioned Idaho. What do you think the big differences are between urban campuses and rural or regional ones? I’m sure there are vast differences, not only in location but in the surrounding communities. How is the model different?
Chris Morett (18:06): In urban areas, the university and the city literally overlap, like interlocking fingers. Town-gown relations have been important since the beginning of the university, and they can’t ignore each other. Even if they didn’t do anything together, their people mix, eat at the same restaurants, and students are loud walking home late at night. You also have graduates working at companies in that town. That may be less true at a national university like Northwestern, and you know this better than I do, but I bet some Northwestern grads still end up in Chicago, live in Evanston, or work up there. So with urban universities, there’s a more natural, organic togetherness, and that leads to things like real estate partnerships. If you work downtown in the Loop and want to be an executive in residence at Northwestern, you just take the train up. No planning involved. But if you want to be an executive in residence in Missoula, Montana, unless your company happens to be there, it’s a whole other undertaking.
So the fundamentals push more toward these arrangements in urban areas. In rural areas, or at small colleges, what happens when one closes or is bleeding money? That’s a bigger question. How do you get someone out there, and how do you repurpose the building? I was actually talking about this on my podcast the other day. Is that where a developer has to come in and say, “We’re going to make this a thing. We’ll bring amenities. We have a pipeline of potential clients, we know the market, and we’ve seen this succeed and fail. We’re going to develop something”? It would be less incremental, maybe. What do you think?
The Demographic Cliff
Gordon Lamphere (20:14): Speaking of the big shift we’re starting to see in universities, the issue I see come up most, particularly among listeners who are student housing developers or in labs and life sciences near universities, is the demographic cliff. It’s not crazy to say enrollment is shrinking if you look at the data. What does that ultimately mean for campuses across the country, and for different types of institutions?
Chris Morett (20:57): The demographic cliff is starting roughly this year. What’s funny is that there are something like forty million people with some college and no degree, plus others with no college at all. I want to say it should be easy to get them into college to partially offset the eighteen-year-olds who aren’t showing up. At least conceptually. Execution takes details and money, but it’s a huge pool of people. That said, those folks may be less likely to live on campus, because they’re older.
Speaking of dorms, some schools don’t have enough dorm space now, so maybe the demographic cliff will lighten the load for them. Others will lose housing revenue, but it may be less existential for them than for smaller schools that really rely on housing revenue, especially where they discount tuition, making housing and other fees even more important. Those schools will have to do something. You also see flagship enrollments going up to some extent. Penn State’s State College campus is about to grow by fifteen or twenty percent, on top of a base of fifty or fifty-five thousand students. Then you have the regionals, whether public or small private, that will have to do something, and it will have to involve getting students from different places.
Why do I think it’s easy? Workforce retraining. We talk about how quickly work skills are going to evolve, and it’s like, “How could we solve that problem? We’ve got a bunch of colleges over here that educate people and give them credentials validating what they’ve done.” Will that happen? I don’t know. And in the middle are institutions doing creative things. I think this is where your listeners would have so many interesting ideas, and it’s why we have to keep talking. I’m one person, far from knowing everything, even what’s in front of my face. But Rider University in New Jersey
Chris Morett (23:20): used some of its dorms to house students from Mercer County Community College. Things like that are just thinking a little outside the box. Schools still want to be academic and keep academic freedom, but we all have to think about revenue generation. I recently saw a job posting at Franklin & Marshall College with a title something like director of revenue generation from our space. It obviously wasn’t quite that title, but the job was generating revenue through the properties they own, their auxiliaries, and their campus. I think that’s where the action is going to be.
Which Schools Are Most at Risk
Gordon Lamphere (23:59): Which types of institutions are most at risk of having to change because of demographic shifts in the United States and the West generally? On the commercial side, one big change we’ve seen is that fewer students are graduating from college overall, so employers looking at the labor force see much more demand for certain segments. What are you seeing on the demographic side, and are certain types of schools most at risk?
Chris Morett (24:42): There’s an interesting person named Gary Stocker who talks and writes about which colleges are at risk and how to analyze that. But in a sentence or two, it’s the smaller public schools, and on the private side, it’s everyone outside a small layer of very well-off, well-heeled institutions that accept less than ten percent of applicants. Those will be fine, but that’s a pretty small swath, and more schools fall outside it than you’d think, including some pretty prestigious institutions. Then you have religious colleges. A lot of these schools simply benefited from having more students, which is fine and rational. Now there are fewer, and markets contract.
It’s painful when an institution contracts, because it has a history and alumni, and it may be very high quality. Most other businesses and institutions aren’t as all-encompassing in people’s lives and communities as a university. Maybe GE was, or certain other companies, but for the most part, a company’s alumni go work somewhere else, and they’re probably not as sad if it closes as they would be if their alma mater closed. So you’ll see some contraction, and maybe it’s necessary. I won’t use the word good. Will you see mergers?
One big question I have: if you pull the trigger early on selling the institution or forming a partnership, you might wonder whether you could have survived on your own. But if you wait, your options shrink. Your school is bleeding money and enrollment, you waited to see whether you could survive, and now you’re really in a corner, with a much weaker bargaining position. Maybe you end up closing. So one thing I’m really interested in is the decision-making process at at-risk schools.
Chris Morett (27:06): Those are the schools at risk: the smaller ones and the regional publics. How can they do better, and how have some done better? Some have gone hard into online education. Some have succeeded, and some have tried and failed. Vocational strategies are good. We have a nursing shortage. The question is how many schools can recognize a need like that, mobilize a program, and find students who want to attend, or live there if it isn’t residential, and then go back to wherever they came from. That’s where the devil is in the details.
Warning Signs for Investors, and Why to Engage Early
Gordon Lamphere (27:46): Let’s dive into some of those details. As a private-sector investor in a community, what should I watch for with universities that might be in trouble? A lot of people see universities as key economic drivers in their communities, as you mentioned, but there’s also risk if that driver is struggling.
Chris Morett (28:15): The first thing I’d say is that, with few exceptions, maybe none, developers and community members should start engaging with universities and colleges now, and some already have. Even the most robust, healthy institution can still improve, and you can still help. There may be partnerships that benefit one or both parties. Think of the best institutions in the world, the healthiest ones, like Goldman Sachs, Harvard, or Microsoft. They interact constantly with developers, service providers, and vendors, because those folks bring value. So engage, and don’t wait for a school to start floating toward the top of the tank.
But at-risk schools may be more amenable to trying different things, or may have more excess space, so those are the ones to look for. The irony is that they may lack the internal capacity to manage their space well, because they don’t have the personnel. That’s where private-sector folks can come in and say, “We can help you with all of that. Yes, our end goal is mutually beneficial revenue generation, but part of it is helping you get there.” Gary Stocker really does have some good resources on how to evaluate this. You look at enrollment declines, and at things like what percentage of the budget comes from the endowment. I’ll stop there, but it’s fundamentals your listeners could readily imagine.
Federal Policy Shocks: Indirect Costs and International Students
Gordon Lamphere (29:58): Speaking of financial fundamentals, one big source of pressure has been policy shocks from the current administration. We’re not a political podcast, but we do look at how the administration might affect parts of the economy or the public sector, and how those pressures might play out in a real estate portfolio. Are those pressures driving substantial change on university campuses, or is it mostly headlines?
Chris Morett (30:31): In answering that, I’ll bring up a term I haven’t used yet: deferred maintenance. With your audience, I don’t need to explain what it is or what it can mean, but it’s in all of this, and in your question in particular. I try to be measured in my views, and on economic policy I tend to be a pragmatist. But if somebody came in and said there’s a war on science, I might have trouble rebutting that. Or they might ask how a war on science would look any different from what we see now, and I might have trouble answering.
And it’s not just the moves being made. It’s the short lead time. The two examples in the headlines that everybody knows about start with cutting the indirect cost reimbursement rate on NIH grants to 15 percent, when some schools’ rates are 40 or 50 percent or higher. If you were going to do that, which I think would neuter a lot of really important, expensive basic science that has no immediate payoff, and a lot of which won’t pay off for 10, 20, or 50 years, so there’s no immediate financial incentive for a company to invest in it, which is the Econ 101 argument for government’s role when there’s a market failure, you don’t do it in six months or two years. Some of it is being challenged in court, but schools are scared now.
I’m not saying I favor every university construction project. Some could perhaps have been avoided, and we need more data in that space. But some are needed. If you’re building a high-tech lab to try to cure cancer, you may simply need to build it from the ground up, or it may be cheaper to do it as a $200 million new build. Even if all these policies get challenged and overturned in court, schools are more afraid. I’ve seen building projects get canceled, so I think it will have a chilling effect on construction to some extent.
The other example is
Chris Morett (33:00): international students, who are an essential part of the research infrastructure. Absolutely essential. They run labs, and on the teaching side they serve as TAs and lab assistants. Schools rely on them, and they’re getting training at the same time. If you want to make the argument for them, some are among the smartest people in the world, and they come live in our communities. If you cut that off, and do it in April when they’re supposed to show up in September, it’s going to be a disaster.
Gordon Lamphere (33:38): How have you seen that play out in the data? From friends in student housing, I’ve heard that some campuses seem to have been hit hard, like schools in the Northeast around Boston, where visa restrictions by the current administration may have substantially affected student populations. At other schools, it doesn’t seem to have played as significant a role. Is that regional? Is it about degree quality? How is it playing out?
Chris Morett (34:25): To the extent it shapes who comes here, the quality of the students will be harder to measure, because what’s the counterfactual? That’s harder. As for actual numbers, I think you’re right, but I wouldn’t claim to know. It’s just too soon. Maybe in a year some equilibrium will have settled in. Students may come back, and universities may find ways around it. To be honest, it’s too early to know. Like you said, what matters is keeping our eye on the data and the trends. Higher ed is so cyclical. Students start applying now and get accepted, so if you miss the boat for next year, which stinks, you then have a year to catch your breath and measure. And the policies shaping this fall’s recruitment and admissions had to be finalized at least a few months ago. So I’d say go into data-gathering mode now, and know that opportunities for action have to line up with the cycle.
Labs, AI, and Where Developers Fit
Gordon Lamphere (35:32): Speaking of data, you mentioned labs being particularly difficult to build, and we have a number of lab developers who listen to this podcast. What are you seeing from the public sector on lab construction? For most research universities, labs are a focal point not only of campus life but also of long-term revenue.
Chris Morett (36:05): I think there are several sub-aspects: planning and design, operations, and actual scientific collaboration. Those are all different lanes to be in. And the question changes when you’re talking about truly cutting-edge labs that are needed quickly, where building them might be easier with private-sector involvement, maybe because university facilities departments are overwhelmed or lack the scale, whereas a private firm might say, “We just built a whole facility for Merck. We’re ready to go.”
I wish I could give a great answer about the sciences. Right now, with AI, will we see universities’ interest shift away from wet labs toward more computational, data-driven work? Is that a trend or a blip? AI will be a thing, and these data centers will be a thing. But what could change that trajectory? Could we find different ways to power them so that all this data center construction and energy demand dips? Will it just be an upward curve? We’re all social creatures, so if AI becomes a little less trendy, even while keeping its place in society, will some money move back into wet labs? That’s something to keep an ear on.
I’m curious about you, too, because developers can help drive that, whether through marketing, informal influence, where funding is available, or interest rates. If a developer were in the room with us right now, knowing AI and its facilities are growing but facing the next budget cycle, what would they be looking for? Where would they each diversify their portfolio?
Gordon Lamphere (38:22): I’ll say this as somebody who talks to a lot of developers: unless you’re Blackstone or one of a very select group of highly capitalized developers, most of the AI space isn’t one your average developer can play in. Lab space isn’t the most accessible space either if you’re a small developer. It’s difficult to get into because it takes a degree of capitalization, but not the degree that AI and data centers take. What I’ve seen across the board is that for lab space, you have to be in the top twenty percent of developers, while for data centers, you have to be in the top 0.001 percent. So based on price per square foot and the constant reinvestment needed to keep pace with Moore’s law, labs will always be a more accommodating space for development. But that doesn’t mean lab space is like building a two-story multifamily building. It’s a very different space.
Chris Morett (39:39): True.
Gordon Lamphere (39:46): And every step up creates a bigger capital moat.
Chris Morett (39:50): I wonder, and this may expose what I don’t know about the developer’s world, whether this is a particular inflection point. There’s a changing mix of what facilities we need, and a different mix of planning, design, construction, operations, and renovation. Does it make sense for a developer, and some have, like the behemoths, to say, “We know the design side is going to be unpredictable for a while, so we’ll expand into other services around facilities,” or to double down on analytics? You could say many have already done that, and yes, they have, but I’m still asking: is that the play for dealing with some of this really fast-moving change?
Growing on Landlocked Urban Campuses
Gordon Lamphere (40:57): How have campuses navigated some of that fast-moving change? I went to Tulane for law school, which I’d categorize as an urban campus, and to St. Mary’s College of Maryland for undergrad, which is very rural. You could see farm fields out the window. They’re very different. On certain campuses, it’s much harder to change quickly, because there’s no available land and you have to reuse existing buildings. If you’re NYU, Tulane, or the University of Chicago, how do you change quickly when there’s no vacant lot next door?
Chris Morett (41:44): That’s a great question. To cheat on the answer: you find a vacant lot, or you make one. That’s actually a semi-serious answer. The other thing is that you move away from “this department needs a new building.” Again, these are generalizations, and you could find exceptions. The university comes in and says, “We’re going to build this state-of-the-art research building. We know some mix of these groups will use it. We’re not going to wait for our deans or faculty to say they need it. As imperfect as the data may be, given the information asymmetry, we have a rough sense of what could work and what the scientific needs are. We’re going to build it.”
I call that more activist space planning: “I don’t know what’s happening in every lab on campus, but I’m going to build this one and control who goes in. If they don’t like that, they don’t have to use the building. It will be efficient, with flexible labs that can shrink and grow, and if you don’t produce research, you won’t keep your place.” You do see that. And where do they find the space? Developers find a way. Is there ever truly no space? Maybe sometimes, and that’s when you have to make decisions. One option is going further from campus, which sometimes happens, on the reasoning that it’s mostly researchers, or some grad students, not undergraduates rushing back for English class.
So one factor is proximity. George Mason, for example, strategically built a big facility in Northern Virginia, closer to the D.C. region than its main campus, and Virginia Tech has facilities far from Blacksburg. So one lever is geographic location, and the other is whether there’s adaptive reuse to be done. I think that’s still shaking out, layered over the vacancy rates we’re seeing, or at least that I’ve heard about.
Gordon Lamphere (44:07): Is there a particular type of academic building where you’re seeing the most adaptive reuse?
Chris Morett (44:18): I’m working with an architecture firm now, and I think adaptive reuse of academic buildings, with creative ideas, should be a next growth area. Where you don’t see it is in the older buildings. They just aren’t made for new uses, whether it’s vibration control, Wi-Fi, or plumbing. So it’ll be some of the newer buildings with more straightforward mechanical systems, or buildings that already had some mechanical infrastructure, like class labs that could be turned into a research lab building, or vice versa. You’re looking for the building’s infrastructure.
The Final Four: More Developer Involvement in Higher Ed
Gordon Lamphere (45:05): We’d love to keep talking about the bones of buildings, but we’ve got to wrap up, and we always love to wrap up with our final four and learn more about where things are going in your area of expertise. One question we love to ask: where do you see real estate going in your sector, public and private universities? How do you see them using real estate over the next ten years, and where will the change be?
Chris Morett (45:50): This is nice, because I can crystallize some of what I was meandering about. You’ll see increasing developer involvement in higher education facilities, period. The reasons include rapid change in science, utter instability in funding, the awareness that we need to make things happen, and the need for data. With proptech, it’s no longer just “we wish we had this data.” The technology exists now. So will developers, or other private companies, come in and help? Facilities, planning, and construction departments are very understaffed, so I see increased involvement.
Universities’ slowness is partly a strength, which the hotshots don’t like to admit. Sometimes it’s a strength to be a slow-moving, deliberative institution. But the time is right in higher ed. A lot of people in higher ed are ready to roll, but they’re constrained. So the last thing I’ll say is: can developers see themselves as the removers of constraints for willing partners?
Book Recommendations: The Effective Executive and The Old Man and the Sea
Gordon Lamphere (47:12): That’s interesting. We always like to remove constraints on ourselves as well, and one way we do that is by learning how other people see the world, including through books. Is there a book our listeners should pick up?
Chris Morett (47:36): If we’re talking business books, I’ve probably read fewer than most, but I can cite a classic: The Effective Executive by Peter Drucker. I used to assign it in my social science research methods classes, because Drucker talks about computers and all they can do, and I think the book was written in the sixties. But he also says computers are dumb. They just follow orders. And he talks about a concept he calls a criterion of relevance: we have to ask the right questions. I’d talk with my sociology students about what questions we’re asking and, to start, which measures matter. I think that’s true even in the era of AI, maybe on a different level. Is it agentic? Can AI be smart? Can it reason? I still think some of those philosophical questions, by definition, can’t be answered outside the human race, but that’s another debate. More practically, humans can still shape, to a large extent, the context in which AI is put into practice. So that idea of a criterion of relevance, what we’re doing and how we’re thinking about it, is still really important. That book has been great.
The other one, if I can add it: read some novels, like The Old Man and the Sea. That’s a great business book. A great business book.
Advice for Young Professionals: Recognize Your Strengths
Gordon Lamphere (49:22): We never shame novels on this podcast. I will say that one of the most interesting things we’ve seen about AI is that it ultimately comes down to asking it good questions. Even if AI becomes dominant in a lot of our research, you still have to prompt it with the right questions, so questions matter. We have one we always love to ask. A lot of our listeners are probably under 30 and interested in real estate generally. What advice would you give a young Chris interested in pursuing academia, or maybe just life itself?
Chris Morett (50:24): The biggest thing I’d say is that people tend not to be fully aware of their strengths. Part of that may be humility, modesty, ignorance, or just not thinking about it. But the huge factor I’d focus on is that the things we’re really good at and love are our strengths, yet we don’t experience them as strengths. They’re just things we love to do. For example, I’d say I’m a good connector. My dad was, and I got it from him. I see two people from totally different parts of my life and think they should be introduced, and I get a charge out of doing that even if I get nothing from it. Not everybody thinks that way, but it’s a major strength. So think hard about your strengths, and realize that just because something comes easily to you, or you enjoy it, it could still be your greatest strength, one others will really value and that you should appreciate.
Who Should Be Our Next Guest?
Gordon Lamphere (51:28): We appreciate that. It’s a wonderful worldview, and I think taking a look at ourselves is sometimes one of the most undervalued parts of life. The whole point of this podcast is taking a look at different people, and there’s one question we never let anyone get away from: who’s the next person we should take a look at on this podcast?
Chris Morett (52:04): I thought about that, and I have a few people I’d mention. One is Dan Munnerley, executive director of Next Lab at Arizona State University. He does a lot with virtual, mixed, and augmented reality. I’ve had a lot of conversations with him, and I co-presented with him at a conference on the impact of VR and AR on university capital planning. He’s really knowledgeable, but he’s not a pro-VR evangelist. He’s very measured.
We talked about several things, including individuals’ ability to shape the spaces they’re in. As much as I think about it, it’s really hard to know the mindset of Gen Z or Gen Alpha. We can only keep trying. One example: do I really know what it’s like to grow up when the earth feels like it’s actually burning, versus seeing some commercials about litter, which was the environmental movement when I was growing up? Talk of catastrophic ice sheet collapse disturbs me too, but is it different to experience that when you’re ten? That’s one example, and I don’t mean to get political by mentioning climate science. Going back to Dan: take something like Minecraft, which is an example of people controlling the environment they’re in, albeit a digital one. What does that mean for their experiences in physical space, and how they blend digital and physical experiences? Dan talks about all of that, and he’d be really interesting to have on. I had a few others in mind, but they’ve escaped me.
Gordon Lamphere (54:00): I think that’s an excellent suggestion. Our audience definitely leans more conservative, and we had one of the leading Gen Z voices in climate science, who covers climate for NPR, on to talk about climate anxiety and generational differences, and I definitely got some pushback from some listeners. I’m pretty moderate on the topic personally, pretty agnostic, and try to look at the science and understand it. But I think it’s really important to hear all the voices in the room and understand where people are coming from and where the science may lead us. That sounds like a phenomenal guest.
How to Reach Chris Morett
We do have one very important question before we go, and we won’t let you get away: if somebody wants to reach out to you, Chris, what’s the best way to get in contact?
Chris Morett (55:08): You can find me walking my dog around my house. That’s the number one way, because I do it about three times a day. Otherwise, look me up on LinkedIn, or visit my company’s website. The company is called Cohere Campus and Workplace. We do space planning and space utilization for campuses and workplaces. The website is teamcohere.com, one word with no punctuation, and my email is [email protected].
Gordon Lamphere (55:43): Thanks again to Chris. We appreciate his insights. If you enjoyed the podcast, please give us a like, a five-star rating, and a review. Your comments, interactions, and subscriptions truly matter and help us continue to bring on quality guests. You can find us on YouTube, Spotify, or wherever you get your podcasts. I’m Gordon Lamphere with The Real Finds Podcast. Thank you for listening.
Van Vlissingen and Co. has been the Midwest’s oldest commercial real estate brokerage, development, and management firm since 1879, and today is independently ranked the #1 commercial real estate agency in Chicagoland, home to the #1 independently ranked agent, Gordon Lamphere, and the region’s #1 ranked commercial property management team. If you own, manage, or invest in energy-adjacent, mixed-use, or transit-oriented property across Lake County, the North Shore, the Northwest and O’Hare corridors, DuPage and the I-88 corridor, Will County, or southern Wisconsin’s Pleasant Prairie, Kenosha, and Racine markets, contact Van Vlissingen and Co. at 📞 847-634-2300 or 🌐 vvco.com. For a market-wide view of where these dynamics sit today, see our State of the Chicagoland Commercial Real Estate Market for Q3 2026.