Universities hit pause on $800 million in capital projectsRender of the RISE science building on site at Deakin's Burwood campus.

Universities hit pause on $800 million in capital projects

Deakin University put a planned new science precinct development on hold as it responds to slumping revenue, part of a capital squeeze worth an estimated $800 million across just three universities.

The freezing of the plan to develop 20,000 square metres in a new 8-level building and refurbish some existing buildings at Deakin’s suburban Melbourne Burwood campus – a project industry sources valued at $145 million – is one in a string of higher education capital projects to be shelved.

“That project, very recently, has been paused at a suitable stage in design,” a university spokesperson told The Australian Financial Review on Wednesday.

“It will be reviewed in November. The reason is to retain design flexibility to meet the potential for changed needs.”

Deakin’s RISE project, designed by architecture firm DCM, is one of a number of STEM projects to halt in the current environment, posing a threat to the country’s development of scientific knowledge.

The brakes have slammed on a sector that only two years ago couldn’t swap mortar boards for hard hats quickly enough as institutions sought to update existing facilities and build new ones. But those ambitious plans have crashed back to earth as the pandemic prevents access for foreign students whose fees largely fund the capital works.

The slowdown will not only hit the competition between universities to offer the best facilities and in turn attract more fee-paying students, but also points to a downturn in the facilities higher education can offer local students.

“Universities are going through convulsions at the moment,” said Peter Hurley, a policy fellow at the Mitchell Institute education think tank.

“The losses are extraordinary. There are going to be cuts to teachers and the people who are going to feel it are domestic students.”

Queensland’s Griffith University said on Wednesday it had cut $300 million from the $1 billion it had planned to spend in a five-year strategic plan to build a new campus in central Brisbane and separate research facility, as well as new buildings at its Nathan campus.

“The planned Brisbane CBD campus remains a priority. However, there will now be a reduction in the size and layout of the building,” a spokesperson said.

“The design will ensure we have scope to ???grow into’ the site later. Plans are now on hold for a major capital investment in an advanced design and prototyping technology 2.0 building at the Gold Coast health and knowledge precinct.”

Griffith said it was continuing to work with state and federal governments to secure support to enable its capital plans.

The University of Queensland deferred construction of a $64.5 million health and rehabilitation centre that was due to start this year and also delayed a decision on a planned $300 million science precinct building.

Not all construction is stopping, of course. At UQ, work on a $96 million student accommodation project continued. Melbourne Business School, part of the University of Melbourne, on Wednesday said a plan to develop a new building adjacent to its current one in inner-suburban Carlton was “still being actively pursued”.

In March the University of Sydney put a freeze on spending including buildings to avert a reported $200 million budget shortfall. In April the University of Melbourne said it would freeze up to $350 million in capital works projects.

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