Executive Summary
California State University, Fullerton, the oldest university in Fullerton, in collaboration with the City of Fullerton has come up with a project to develop a town known as college town. The location of the town is to be behind Hope University and the current Nutwood Street. The college town is designed to provide various activities, which may be of great benefit to not only the members of CSUF, but also to other members of the public.
Due to the magnitude of the project and people who have the potential of being affected by the town, there must be a consensus in development of the town between CSUF and the city of Fullerton regarding the development of the town. In addition, Fullerton University plays a very big role in supporting the economy of Fullerton thus setting up the college town will also help improve its image.
The zoning of the college town will include a residential area that will be divided into the middle class and upper middle and upper class areas. The town will also have a market district where the main businesses of the town will be located. In addition, the town will have a plaza district where prime businesses will be located. Another area will be set aside for use as a residential area or any other development, which may be suitable for the town.
The cost of putting up the town is estimated to be around $ 63.9 billion compared to the benefits, which are estimated to be around $ 30.5 billion. Thus, the setting up of the town would be a worthwhile investment, as the recurrence of the benefits would take the investment positively. The Return on Investment (ROI) is found to be 47 %; this is a fairly large value considering that this is a public development. Thus, ROI show that setting up the college town is a viable investment to the university and the people of Fullerton.
To help promote the image of the town, the paper proposes that it should be done through several Hollywood magazines. In addition, promotion would also be done through CSUF and the City of Fullerton who will undertake many of their activities in the town so as to advertise the town indirectly. The town will also try to attract several large chain stores, which are recognized throughout the country to set up their businesses in the town.
Introduction
Universities are very important learning institutions; they are vital to the development of an area. In addition, Universities help in improving prestige and public view of an area, as well as attracting young and bright students, and bringing intellectuals i.e. the lecturers and other trainers to a town.
The presence of a successful university in a given town helps in attracting investments into an area since the companies are assured of a pool of young, bright, and hardworking students who would help in the provision of the necessary manpower required for the effective functioning and growth of the companies.
However, for the investments to be attracted to the area there must be proper infrastructure, which has been put in place to facilitate the smooth running of the companies. In addition, the presence of good infrastructure will help in attracting the students to the university since most young people are known to be attracted to urban centers.
In order to acquire space for expansion of its activities, CSUF came up with the college town to provide additional space for expansion of its activities. In addition, the college town will provide more revenue to CSUF and the city of Fullerton. The university of Fullerton has for a very time been the major establishment which greatly affects the lives of the residents of the city of Fullerton. Establishment of the college town will help it consolidate its position as the defining feature of the city of Fullerton.
Background
California State University Fullerton, known commonly as CSUF, is an integral education institution in the state of California as it is the university that enrolls the highest number of students. In the city of Fullerton, it is the largest learning institution in terms of the number of students who are enrolled in the university (university website, 2011)
Fullerton is generally an area that is almost fully developed with very little land for development. The city is mainly composed of low industrial developments. In addition, there is a project to develop a transportation network known as “Go local.” The transportation network aims at connecting FTC and CSUF campus.
The development of the “Go local,” plan aims at covering just the right place where development of the college town is to be located; that is, behind Hope University and current Nutwood (Focus on Fullerton, 2009). The main strategy for the creation of the Go Local is to help ease the congestion in the city’s freeway. Hence, by easing the congestion the city would be opening up other areas for development and investments.
One of the areas is the area behind Hope University and the current Nutwood Street.
Go local would not only help in decongesting the city but also help in facilitating the development of the college town. The development of the project has therefore been done at a timely period, as its design will be integrated with the design of the Go Local.
Economic Climate
Despite the fact that the city of Fullerton is not a heavy industrial town, various economic activities are undertaken to support its economy and provide thousands of jobs to the residents of Fullerton. Among the economic activities undertaken, include Tourism, Agriculture, Financial services, Building and construction, and Manufacturing.
All the above economic activities generate revenue to the City of Fullerton. In addition, CSUF generates considerable revenue to the city; indeed, CSUF alone is the largest single employer in Fullerton. The economic impact of the university offers $ 4.28 million in output to the economy of Fullerton. In addition, student expenditure offers about 4550 jobs to the residents of the town (Bhattacharya & Cockeril, 2002, p. 4).
Due to the fact that California state university of Fullerton is of so much economic importance t o the city of Fullerton, setting of the college town in the vicinity of CSUF, would enable the city to reap maximum economic benefits from the university by creating thousands of jobs to the residents of Fullerton.
The College Town Project
The college town will offer a variety of services to the people of Fullerton. The college town is designed in such a way that it has a residential area where several apartments will be set up, which will be available to everyone. The apartments are designed in such a way they can be able to offer accommodation even to students who would not wish to be accommodated in the university.
All the apartments will have ample parking and security of the residents. In addition, the college town will offer space for the university to build residential areas to accommodate the students. The college town will also have space to accommodate the expansion of the other CSUF activities.
In addition, the college town will offer an up-market residential area, which is specifically suited for the intellectuals and business people. This area will have various recreation activities that would enhance the comfort of the residents.
This area will have residential units, which will not be fenced to enhance the communal setting of the college town. Though the units will not be fenced, there will be ample security in the area to help in the protection of the residents’ property. Just like all the areas of the city, the residential districts will have all the social services and amenities.
The college town will also have a market place district that will be mainly suited for setting up business enterprise. This area will be specifically suited for banks and other financial institutions in addition to other businesses, which are relatively small. The market place district will be the focal point of the town and will therefore have many aesthetic features, which will help in the improvement of the image of the town. There will be many hotels, clubs, and other entertainment joints, which will be located in this area.
Just past Nutwood road, there will be a plaza district. This area will be suited for entertainment spots, a place where both the youth and families can hang out during their free time. This region will have a five star hotel that will offer world-class facilities and will be ideal for tourists and other people having leisure. This region of the town will be specifically suited for high-income business ventures. A mall will also be established in the area.
The town will also have other parts that can be used for both residential and business purposes. In this area, there will be a large library, which will cater for both the needs of the university students and the public.
This area will have many other recreation facilities such as sports center, swimming pool, sports ground and a recreational park. The recreational park will offer an ideal place where people can relax without the noise and interference of the other areas. This region is also ideal for students for students to spend their leisure time while socializing with other students or the members of the public.
Cost Benefit Analysis
In a business case, cost benefit analysis is used to explain the benefits of a certain investment so as to provide good comparison and thus help in determining whether the investment should be made when the benefits are compared with the costs of undertaking the investment.
However, the cost benefit analysis is not written only for business investments, it can be taken to determine whether certain actions, which are undertaken by a party, will turn out to be good. Hence, the cost benefit analysis of the college town will look at various aspects, which may be caused by the setting up of the college town. Factors that are mainly considered are social, environment and financial or economic.
Costs of setting up the college town
Preliminary costs:
Consultation and planning costs – $ 100 million
Preparation of the area – $ 5 billion
Survey – $ 50 million
Environmental impact estimate – $ 3 billion
Construction costs:
Cost of materials and equipment – $ 50 billion
Labor – $ 4 Billion
Provision of necessary support services:
Access roads – $ 500 million
Electricity – $ 75 million
Water and sewerage – $ 150 million
Landscaping – $ 50 million
Other expenses:
Logistics – $ 1 billion
Total – 63.925 billion
Benefits of setting up the college town:
Employment offered in construction work – $ 1 billion
Employment offered upon completion – $ 6 billion
Entrepreneurial knowledge to the students estimate – $ 10 billion
Social cohesion of the town estimate – $ 2 billion
New students attracted to the university – $ 500 million
New investments attracted to the town – $ 10 billion
Revenue from tourism attraction – $ 30.25 billion
Evaluation of costs and benefits
The total cost of putting up the college town is 63.925 billion. The above costs include all the expenditure that may be involved in the setting up of the college town. However, the benefits of setting up the college town are estimated to be roughly 30.5 billion.
However, the recurrence of some of the benefits would make the benefits outweigh the costs of putting up the town, as most of the costs are not recurrent. Therefore, the setting up of the college town is a potential worthwhile investment and should therefore be made for the benefit of the residents of the town, the students, and other relevant stakeholders.
Promotion
Promotion is a very vital aspect that will determine the success of the college town. Promotion of the college town will be done through famous magazines that are based in California. Particular emphasis will be paid to Hollywood magazines. This will help attract tourists to the college town by portraying the college town as a place where celebrities meet.
The college town will be formulated as a place where intellectuals, both the young and the old meet. The college town will also be portrayed as a place where the true culture of the people Fullerton is exhibited. In addition, it will be portrayed as a place where the young people can have fun responsibly.
In addition, CSUF and the City of Fullerton should form a website of the college town to help attract people to the town. The website will inform people of the various services and activities which are offered at the college town thus attracting them to the college town.
To help in promotion of the town, several CSUF and City of Fullerton activities should be carried out in the college so as to help in making the people of know of the existence of the town. In addition, CSUF and the City of Fullerton should carry out several campaigns to help in attracting investments into the college town.
This can be done through posting of advertisements in several investment magazines. In addition, CSUF and the City of Fullerton should be involved in several workshops and trade fairs to help in the promotion of the image of the town and help attract investments into the town. Several advertising campaigns should also be undertaken using televisions.
The shopping mall to be located at the heart of the town will help in attracting supermarkets and other large chain stores into the area. These establishments will act as a form to promotion to the college town, since, by establishing their businesses, they will be bringing their good reputation to the college town hence attracting people and other investments into the area.
Return on Investment (ROI)
Return on investment or simply ROI, is a method that is used to determine the return that a certain investment is likely to yield over a given period of time. It is used by most analysts to determine the potential income, which the investment may generate before the setting the investment. In calculating ROI, the most tangible financial gains of the project are compared against the cost of implementing the project. Return of investment is not usually as comprehensive as the cost benefit analysis explained above (NSGIC, 2006, p. 1).
ROI is usually presented as a ratio of the total financial gains to the costs of undertaking a certain project.
Costs of undertaking the project
Preliminary costs:
Consultation and planning costs – $ 100 million
Preparation of the area – $ 5 billion
Survey – $ 50 million
Construction costs:
Cost of materials and equipment – $ 50 billion
Labor – $ 4 Billion
Provision of necessary support services:
Access roads – $ 500 million
Electricity – $ 75 million
Water and sewerage – $ 150 million
Landscaping – $ 50 million
Other expenses:
Logistical expenses – $ 1 billion
Total – $ 60.925 billion
Financial benefits of the project:
Employment offered in construction work – $ 1 billion
Employment offered upon completion – $ 6 billion
New students attracted to the university – $ 500 million
New investments attracted to the town – $ 20 billion
Revenue from tourism attraction – $ 1 Billion
Total – $ 28.5 million
Return of investment of the project
ROI = 28.5/60.925 = 47 %.
From the above calculations, the ROI of the project has been determined as 47 %. For a viable business venture, the ROI should generally be greater than zero. Hence, this shows that the investment is viable. The value is far much greater that the ROI of most governments projects which are in most cases negative (NSGIC, 2006, p. 1).
Conclusion
College towns or other establishments undertaken near colleges have been shown to be a great benefit to various societies. Other similar establishments have been successfully implemented in other universities such as the University of Connecticut, Ohio state university and Arizona State University (Anon, 2011).
Creation of the college town would be of great benefit to the city of Fullerton. The benefits are not restricted to the ones explained above. In addition, the several methods of analysis done on the project have shown that the project is a viable undertaking, which has the potential of reaping very good returns to the city of Fullerton. The Cost Benefit Analysis (CBA), the most efficient method of analysis of a project clearly shows that the project is bound to have great benefits.
Even though the implementation and completion of the project may take several years to complete, successful planning of the college town should be done in order to benefit the future generations and help uplift the standard of the city of Fullerton and the California State University, Fullerton.
References
Anon. (2011). City Council Meets College Town! A University without Walls, Where Campus and City Life Converge. CSUF news. Web.
Bhattacharya, R. & Cockerill, L. (2002). Economic impact of California state university, Fullerton. Web.
“Focus on Fullerton. (2009). City of Fullerton website. Web.
NSGIC. (2006). Economic justification measuring Return on Investment (ROI) and Cost Benefit Analysis (CBA). Advanced Statewide Spatial Data Infrastructures in Support of the National Spatial Data Infrastructure. Web.
University website. (2011). California State University, Fullerton. Web.