Making best use of the estate

Things to consider and ways to maximise the performance of your estate.

Maintenance

Effective maintenance of the college estate will help you ensure that you provide safe, warm and weatherproof environments for staff, students and visitors.

College buildings are an important and valuable long-term asset which need to be looked after. Poor or irregular maintenance of college buildings can result in:

  • disruption of education
  • closure or partial closure of your buildings
  • invalidation of your insurance
  • poor value for money
  • unnecessary expenditure to rectify problems
  • shorter building life
  • risks to the health, safety, and welfare of your learners, staff and visitors
  • legal claims
  • non-compliance with regulations

You can reduce these risks through effective and well-planned maintenance of the college estate.

Types of maintenance

Maintenance is typically categorised in 2 ways:

  • planned preventative maintenance (PPM)
  • reactive maintenance

Planned preventative maintenance is:

  • works and activities carried out to keep your land and property in a good state of repair, and to prevent building condition or equipment failure
  • works carried out to fulfil a legal duty
  • regular activities undertaken regardless of condition, such as servicing plant and maintenance, and cleaning of rainwater goods

Reactive maintenance is:

  • works and activities not covered through planned or cyclical maintenance
  • works to fix unexpected problems such as accidental damage to land or buildings vandalism
  • dealing with sudden failure of equipment or a building component
  • addressing urgent health and safety needs

You should assess the condition of your estate through regular condition surveys. You can start to plan and prioritise your college’s maintenance activities based on this.

To comply with guidelines on good governance, you should produce a revised detailed maintenance plan at least every 3 years.

Maintenance planning

Well-planned maintenance will help you:

  • keep your building users safe and secure
  • prolong the life of your estate
  • get value for money from your maintenance spending

To plan maintenance effectively, you should have a good understanding of the buildings within your estate. This information should be held alongside your asset register and should include:

  • basic building information including gross internal areas, building use, age, and method of construction
  • plans of the buildings with useful information, such as fire safety measures, location of hydrants, utility meters and incoming services
  • plans of the sites with utilities information, such as mains drainage, stopcocks, cabling, and isolation points
  • an inventory of important components, such as boilers and pipework, and their life expectancy
  • up-to-date statutory compliance records
  • a schedule of maintenance contracts, such as annual portable appliance testing (PAT), gas safety, boiler maintenance and fire measures
  • building condition surveys
  • asbestos register and asbestos management plan
  • details of any listed buildings and conservation or heritage designations which may affect maintenance works

The plan should include:

  • all regular planned preventative maintenance
  • any planned capital or investment projects

The contents of your maintenance plan will flow from your condition survey data.

Prioritising maintenance works

You will need to prioritise works in your maintenance plan, taking account of:

  • any legal duties and responsibilities
  • works which may impact health, safety, safeguarding or security
  • works impacting the envelope of the building, electrical or mechanical services (such as heating)
  • condition grading indicating the likelihood of failure
  • risk assessment, including impact of element failure and the consequences of not addressing the need
  • available resources

Take account of the findings of regular maintenance cycles when planning longer-term works. This allows you to plan and budget effectively, minimising the risk of failure.

In addition to maintenance checks on building services, you may need to consider other activities such as:

  • food hygiene and catering requirements
  • service and maintenance of specialist machinery and equipment
  • general health, safety and security management
  • safety signage
  • maintenance of CCTV and security equipment

Timing of works

Consider how and when each element of the maintenance plan should be implemented. For example, for reasons of health and safety or access, some works cannot reasonably be completed during term time.

Statutory examination and inspection, testing and maintenance

You will need to inspect and test your buildings, plant and equipment as part of your maintenance regime.

If necessary, you should take professional advice to ensure that your estate is statutorily compliant. You should keep safety certificates and details of all statutory examinations, testing and remedial work alongside your asset register.

Advice on collecting and storing estate documentation is available. The certification and information you should hold for the estate will vary depending on the specific construction type and building services installed.

There are some major items of fabric, plant and equipment likely to be present in all colleges, including:

  • boilers (and other gas installations and equipment)
  • electrical fixed wiring and equipment
  • water systems
  • fire and security systems
  • catering equipment
  • air conditioning systems
  • asbestos
  • lifts
  • local exhaust ventilation (LEV) extraction systems, including kitchen extracts
  • gym equipment

Health and safety law and maintenance

You need to be aware of health and safety issues when you manage and maintain land and buildings.

The safety of all users of the estate, including contractors, is very important. You need to understand what your responsibilities are.

This is a complex area. You should refer to specialist guidance, seeking independent professional advice if necessary. There is more information on legal duties and responsibilities.

Fire safety

College premises, accommodation and facilities should be maintained to a standard that ensures, so far as is reasonable, the health, safety and welfare of learners and staff.

New building work must comply with the Building Regulations 2010 on fire safety. This can be achieved by following the relevant building regulations.

The Regulatory Reform (Fire Safety) Order 2005 (FSO) imposes duties on employers and persons with control of college premises. You must have an appropriate and up-to-date fire risk assessment for all premises under your control.

This will include:

  • ensuring procedures are in place to reduce the likelihood of fire
  • maintaining fire detection and alarm systems
  • familiarising staff and learners with emergency evacuation procedures

See fire safety in the workplace for more information.

The FSO states that you must review the fire risk assessment regularly, and particularly when there is reason to suspect it is no longer valid or where significant changes to the premises or use take place.

In addition, the final report from the Independent Review of Building Regulations and Fire Safety recommends that you review fire risk assessments annually for high-rise residential buildings. Colleges of any height should consider reviewing their assessment annually, or at least every 3 years.

Those completing fire risk assessments, or providing advice in relation to them, should be appropriately qualified or experienced. If you do not have the expertise or time to do the fire risk assessment yourself you need to appoint a competent person to help, for example a professional risk assessor.

Your local fire and rescue authority might be able to give you advice if you’re not sure your risk assessment’s been carried out properly. However, they cannot carry out risk assessments for you.

Energy and sustainability

The way that you manage and develop your estate can have a significant impact on both your environmental footprint and your finances.

Colleges have an important role to play in responding to climate change, and sustainability considerations should underpin all estates activities, from day-to-day building management through to the delivery of new capital projects.

The DfE further education sustainable estates guidance provides details about how to plan, manage, and deliver a sustainable further education estate.

Performance management

Performance management of the estate and benchmarking is the measurement and monitoring of property-related performance. This will help you to improve the efficiency of the estate and release resources for investment.

Measuring the performance of the estate will help you understand:

  • how the property assets in the estate contribute to the overall performance of your organisation
  • how each individual site or asset in the estate is performing
  • what impact the assets of the estate have on teaching and learning

Importance of performance management of the estate

Overall accountability for performance management, including financial performance, sits at board level. Understanding the performance of the estate and using it to challenge and demonstrate value for money is an important element of accountability.

Benchmarking

Benchmarking is a way of using relative performance to learn from others in an effort to improve. It is best conducted in 3 ways:

  • by comparing your data to average whole sector data, to show how your college sits within it
  • by comparison with a subset of colleges which look most like yours – this subset is likely to contain colleges which are of a similar type and have similar operating characteristics, for example other sixth-form colleges with a similar turnover to yours
  • by comparing data across different buildings and campuses within your existing estate which will enable you to better understand the performance of individual campuses, buildings and respective curriculum areas

Benchmarking is not a one-off exercise. It can help:

  • lock your organisation into a cycle of continuous improvement
  • develop a culture where it is easier to ask questions and make changes
  • support the development of your estates strategy and options analysis for making capital investment decisions

Effective practice point

Benchmarking is only a guide. There may be valid reasons why some colleges are at the lower or upper extremes of a data range. However, it is useful to:

  • understand the reasons why, if you are amongst the outliers for any particular measure
  • analyse whether there are any actions which might make positive changes where the comparison is negative
  • encourage sharing of effective practice, where the comparison is positive

Who should be responsible for organising benchmarking processes

Responsibility for performance management of the estate should sit with a designated senior leader. They should also be responsible for reporting performance.

They should understand what the senior leadership team and the board want to know about the estate and identify performance measures accordingly. The actual collation and management of the data used to deliver performance reports for the estate is likely to be the responsibility of the management information system (MIS), finance and estates departments.

Choosing key performance indicators

Effective practice point

If you are planning to use a key performance indicator (KPI) which exists in the data set which is collected in the annual college finance record, check that you are planning to calculate the KPI in precisely the same way as the finance record does so that the comparison is valid.

There are many subtleties which could cause variation in calculation methods and undermine a like-for-like comparison, so it is worth a check if you plan to use this large data source.

You should try to choose a range of KPIs which clearly show how well your estate is performing to support your strategic objectives. You should use standardised reporting formats where possible to enable better understanding of data needs and performance over time.

It’s best to choose KPIs which are:

  • relatively simple to calculate
  • clearly and precisely defined
  • kept to a manageable number

It is up to you how exactly you define the calculation of the KPIs that you wish to benchmark, but it’s important that you set out the calculation in reporting and are consistent with the method you use over time. You should also compare with other data sets which use the same calculation methodology.

Effective practice point

You could use a ‘balanced scorecard’ approach which ties back to your strategic objectives and financial planning. Using this approach, four impact areas could be selected to measure performance which reflect a balanced view of the college’s priorities and key objectives.

For example, choose estates KPIs for financial impact, teaching and learning impact, resources impact, and sustainability impact.

Possible KPIs

Colleges may not adopt all of these:

Financial KPIs

Consider:

  • total running cost per square metre (whole site, by site, by building)
  • energy cost per square metre and per kilowatt-hour (kWh)
  • planned and reactive maintenance costs
  • estate management costs, including cleaning and security
  • earnings before interest, taxes, depreciation, and amortisation (EBITDA) generated by site (if a multi-site college)

Teaching and learning KPIs

Consider:

  • functional suitability of your estate (categorisation from A to D) by percentage of estate in each category
  • the condition of your estate – categorisation against industry standard condition (A to D) by percentage of estate in each category
  • student and staff satisfaction with learning environment (from surveys) – this is best ascertained via views on specific ‘soft’ information, such as views of facilities’ cleanliness or age of equipment
  • access to, and quantity of, shared facilities per attendee, such as study space, social and dining space, sports spaces

Use of resources KPIs

Consider:

  • number of sites and the categorisation by freehold and leasehold by site and by building
  • space available per planned average attendance (PAA)
  • percentage of the available teaching and learning space used for learning delivery over available teaching weeks (utilisation)
  • level of capital investment – capital cost as a percentage of EBITDA, capital cost per student

Sustainability KPIs

Consider:

  • energy consumption, including calculation of energy consumption by reference to a site, and if data is available, the area of each building – this is a different measure to energy cost
  • water consumption
  • environmental impact, including an assessment of emissions per area of building
  • renewable energy consumption
  • waste management and the amount of recycled waste

Effective practice point

Many of these KPIs rely on accurate data on internal floor areas, with a clear and consistent definition of which parts of the estate are included and which are not. Out-of-date or incomplete data on floor area can compromise the value of benchmarking processes.

Case study: Reaseheath College

The college conducts a very thorough planning process which requires each area to present plans for their curriculum in a ‘balanced scorecard’ approach.

Initial curriculum plans are required to be presented in a 90-minute session which covers four areas:

  • curriculum and impact, such as content, quality, development, guided learning hours (GLH) and pastoral
  • people plan, such as skillsets and development
  • environment, such as facilities and resources
  • financial, such as delivery model, budget and contribution

Requirements for investment are captured in detail at this stage, helping to produce investment appraisals which link into the budget.

This is then used to formulate KPIs for ongoing performance measurement. A major advantage of this approach is that capital requirements are identified from an early stage, rather than there being a separate bid exercise later.

Read the full Reaseheath College case study to find out more about how they’ve managed their estate.

Collecting and comparing performance data

Many of the suggested KPIs listed in the example above are collected as part of the annual finance record data collection. You can compare your KPIs with similar colleges as part of a benchmarking exercise when data is published annually by using the financial benchmarking tool for colleges and also the ‘Compare your curriculum efficiency’ tool available in  View your education data.

The Compare your curriculum efficiency tool will allow you to select groups of colleges by different operational characteristics, including college type, turnover, EBITDA and Ofsted grade and compare the suite of benchmarking KPIs collected in the finance record which includes some estates and curriculum planning data.

The estates data collected in the finance record includes:

  • single or multi-site campus
  • capital expenditure (CAPEX) as a percentage of EBITDA
  • capital expenditure as a percentage of income
  • energy costs per square metre, analysed into component costs
  • total cleaning costs and cleaning costs per square metre
  • estate running costs per square metre
  • income generated per square metre of estate space

Where the data that you want to use to measure estates performance is not collected in the finance record, you will need to decide how to collect it and whether there are existing routes for comparison available.

Collecting data can be time consuming and costly. The benefits of comparing identified performance measures must justify the cost and effort of collating, analysing and reporting. You should assess what data you already collect outside of the finance record. You may be able to use this as a starting point and build on it over time.

Where possible, design the ability to collect the key data that you need to measure your performance into your organisational systems planning and at the outset of any capital projects.

Possible routes for the benchmarking of KPIs which are not contained in the finance record include:

  • sharing data on JISCmail
  • staff and student surveys
  • local college benchmarking groups and informal networks
  • commissioning sector consultants to undertake benchmarking amongst their client bases
  • collection by sector bodies which represent various specific college groups, such as the Sixth Form College Association and Landex

Useful benchmarking data from the higher education sector is available. The Higher Education Statistics Agency (HESA) has recently merged with Jisc (Joint Information Systems Committee) and colleges could benefit from engagement with their estate benchmarking process.

Effective practice point

External benchmarking exercises will typically provide specific indicators for efficiency of the estate. These can usefully identify the extent to which estates costs vary from comparable colleges and also highlight how far this is impacted by the amount of space or the unit cost per square metre.

Case study: BHASVIC

The college does not currently use estate metrics to measure ongoing efficiency and utilisation. However, the management team is aware of this gap in information and is planning to implement an estate dashboard which will report on key metrics and pull together other information such as the asbestos register and contractor contacts into a single information point.

This is at an early stage of planning but will be good practice and could provide a useful tool for monitoring the effectiveness of future strategies for a high-quality learning environment. It will also prove crucial in the achievement of the stretching sustainability goals that the college has embraced.

Read the full BHASVIC study to find out more about how they’ve managed their estate.

Maximising value from the estate

Many colleges generate additional income by renting out some of their spaces and facilities outside of teaching hours.

Hiring out property

The precise nature of the hiring activity will depend on your college and its estate, but colleges often hire out parts of the estate including:

  • sports pitches and facilities
  • classrooms
  • halls
  • theatre and performance spaces
  • car parks

When hiring out space, you should ensure that all arrangements are appropriately documented. This is typically done through the use of licences.

You should ensure that your college takes appropriate legal advice when entering into any agreement relating to the use of your estates by third parties, including drafting clear exit pathways in the lease agreement. You should also store agreements securely and diarise any notice periods and conditions of the lease leading up to renewal, so that you are able to exit the lease efficiently if you need to.

You should also ensure that appropriate management systems are in place to deal with matters relating to third party hires. These include:

  • booking systems
  • payment systems
  • insurance
  • health and safety
  • access and security
  • cleaning and waste management
  • documented compliance with your policies on safeguarding and Prevent

If your college is operating from leased premises, you should:

  • check the terms of your lease to ensure that hiring space to third parties is permitted
  • make sure that the financial benefit of additional income outweighs the time and money spent managing the hiring process and does not detract from the college’s core purpose

If you are developing new facilities which you hope to rent out commercially, you should:

  • consider the management implications of the space you are designing to simplify the management of future hires
  • get external advice on potential market demand and where to pitch rents, where appropriate
  • consider whether any of your development plans could be novel, contentious or repercussive as set out by Managing public money and consult with the Department for Education before proceeding if you believe that this might apply.

Leasing property

Some colleges may let surplus or commercial space such as office space or a coffee shop, to another party by way of a lease.

While leasing property can generate additional income, it is more complex than hiring out premises by way of a licence and involves giving exclusive possession of the property to another party.

Being a commercial landlord involves ongoing property management and can include responsibility for matters including:

You may also be responsible for service charges, such as charges for utilities. If you are leasing out part of your estate, you need to consider whether to install separate metering and plan how this element of the charge will be evidenced.

If it is not cost effective to install a separately-metered supply, you need to make sure the basis for charging for utilities is clearly set out in the lease or service charge agreement. The utility supply and payment arrangements could also affect value added tax (VAT) treatment of the service charge. All annual service charges need to be clearly set out and understood by your tenant.

The Royal Institution of Chartered Surveyors (RICS) has published guidance on setting up and managing service charges in commercial property.

You should ensure that you take appropriate professional property and legal advice before leasing out property to a third party.

VAT on college commercial hiring

For the rules for VAT you should check the latest published advice from HM Revenue and Customs (HMRC) before deciding on tax treatment of income.

You need to check if the property has been opted to tax. If this is the case, different rules apply. There are also different rules for hirings by non-charitable subsidiaries.

The principles listed below are a general steer and should not be construed as tax advice.

Exempt hiring income (no VAT)

Includes:

  • income from hire of general space (rooms, meeting venues, office space for business purposes, mast location rental). This includes equipment, where the hire of the equipment is secondary to the space hire, and beverages supplied with hire
  • income from hire of sports facilities, including pitches, to individuals, family or groups of friends or community sports clubs and schools (for use by their members or pupils)
  • income from out-of-hours locking-up time for either of the above

Standard-rated hiring income

Includes:

  • hire of equipment where the room space is secondary to the equipment (for example: recording studio, box office and technical support services)
  • hire for storage
  • car parking charges to non-students
  • admission tickets to events
  • catering services beyond minimal refreshments (such as tea, coffee and biscuits) with a room
  • hire of sports facilities to corporate and business customers

Evidencing non-business use for zero-rated construction

You need to think about which buildings will be used for commercial hirings. If a building was zero-rated for VAT when it was built, you may lose the zero-rating if you hire out its rooms or facilities within ten years of its completion. This depends on the volume of the hiring activity. This may mean construction VAT charges are imposed.

See financing the estates strategy for more information.

What governors need to know

The Department for Education has published a FE and sixth-form college corporations: governance guide which advises on the responsibilities and best practice for governance teams. It contains a section on finance and estates management which underpins the advice in this guide.

To make best use of your estate, governors need to be confident that there is a comprehensive schedule of inspection and testing of resources in place.

The college executive leaders should monitor a record of legally required maintenance. You should check arrangements for the inspection and testing of college buildings, plant and equipment as part of a regular maintenance regime and with particular regard for health and safety impact.

In order to assure yourself that such a monitoring regime is in place you should:

  • consider commissioning periodic internal audits to check that the systems for maintenance of estates infrastructure are operating effectively
  • ask for high level reporting on insurance claims and reports at regular intervals
  • check any summary reporting on complaints that you receive for patterns relating to poor facilities
  • conduct visual inspections and “walkabouts” of the college sites

Climate change and sustainability

Climate change and sustainability are topics of increasingly urgent importance in leading educational provision.

You should:

  • check that energy efficiency and sustainability are considerations in all relevant decision-making
  • ensure that your college has identified performance metrics for energy efficiency which you should see as part of KPIs reported to you to ensure that progress is being made

There are external organisations which can help with creating a carbon reduction plan for your college. There are now a number of potential providers of such plans, and you may wish to obtain quotes from several of them to compare costs.

Advice on creating an education offer which involves sustainable development is available from the Education and Training Foundation.

The DfE further education sustainable estates guidance provides details about how to plan, manage, and deliver a sustainable further education estate.

Key performance indicators

You should:

  • use KPIs on how well your estate is being managed as part of regular performance reporting
  • use reports that include energy efficiency and carbon usage KPIs but could also include important measure of how well space is being utilised, running costs per square metre, condition survey updates and capital investment by building, curriculum area or student

You may find it helpful to compare your college’s performance on estate management with other, similar colleges. Data from all colleges on certain aspects of estates management will be published in the annually available finance record data and could be compiled in a report to you. Your management team may also have an informal network of similar colleges which can be used to share and compare estates information.

Maximising value from the estate

Many colleges generate additional income by renting out some of their spaces and facilities outside of teaching hours.

When hiring out space, you should check that all arrangements are appropriately documented.

You should make sure that the financial benefit of additional income outweighs the time and money spent managing the hiring process and does not detract from the college’s core purpose.

Safeguarding and Prevent

Your college needs to make sure it has embedded suitable processes for ensuring that all external lettings and hiring are compliant with your safeguarding and Prevent policies.