What Business Do Universities Have Being Big-Time Real Estate Developers?

As a lot of industries have died or left, colleges remain, because these institutions had inertia and are now increasingly important. Universities are taking over more and more of their communities' land and services, in order to survive.

In a famous 1976 essay, “The City as a Growth Machine,” sociologist Harvey Molotch outlined the coalition of private and public interests that had made economic growth the paramount goal of local government. “Most of those institutions have disappeared,” Wim Wiewel, the president of Lewis & Clark College and the editor of a pair of books on university development, observed in a recent conversation. “The department store is closed, the newspaper is bankrupt, the local bank is no longer local, and the manufacturing is gone.”
What remains is the university. A university is now the largest employer in two-thirds of America’s 100 largest cities (and a handful of states as well). Even in New York City, home to 45 Fortune 500 companies and a global capital of finance, media, and fashion, five of the top 10 private employers are anchor institutions like universities and academic medical centers. It can be easy to exaggerate the importance of higher ed as an anchor, an extreme example of which is the argument that Detroit’s bankruptcy might have been avoided by the presence of its own Case Western or Carnegie Mellon. But there’s no question that as cities have hollowed out, universities have enthusiastically seized more economic and urban development responsibilities.
In its most basic form, this mission creep represents the realization, on the part of university brass, that an institution is only as strong as its neighborhood...