Placing 600 university employees on 4th Street was problematic from the beginning. There were and are other alternatives that would not only help the City of Berkeley, but also reinforce the position of staff as partners in the enterprise rather than back-of-the-house support.
Beginning in 2009-10 with a $3 million study by Bain & Company, the campus underwent an administrative reorganization under the name Operational Excellence. The intention was to combine administrative staffing thereby streamlining processes and procedures in order to save money. This effort led to Campus Shared Services (CSS) where individual units, schools, colleges and departments no longer employed and supervised certain support staff, but rather staffing was centralized and shared among several units.
To accommodate the more than 600 people in a single location the campus initially signed a 10-year lease on 1608 Fourth Street. Soon thereafter the University purchased the property for $24 million.
I voiced my concerns over this location when it was first announced. In my correspondence I cited the negative environmental impacts, the loss of an opportunity to economically support other areas of the city and the dissolution of staff as full partners in decision-making within units. The response was:
We would also have much preferred a location on campus or within walking distance of the campus, but no such space was available in the market. We also looked at alternatives that were further away (Emeryville and Oakland), but rejected those as even less desirable alternatives. The 4th Street location provided us the required amount of space in a safe neighborhood with good amenities.
The 4th Street location undermines the campus green strategy. The North Berkeley BART station is 1.3 miles from CSS. There is a shuttle that runs from 6:40-9:20 AM and again from 4:10 – 6:10 in the afternoon, but none that runs from 4th Street to campus. More than half of those at CSS drive, 30 percent take BART. About 5 percent ride a bike. To its credit the administration has identified several ways to reach CSS, but unless you live in west Berkeley, walking is not among them. Walking is also not an option if you need to meet on campus.
The 4th Street building is not on the campus energy grid. It is independent. While there is a substantial flat roof and no obstacles to obscure the sun, no solar equipment was installed.
Campus Shared Services is adjacent to an asphalt processing plant. There have been recurrent calls to the EPA when the smell and soot are obvious, but the plant is in compliance. Cars arriving in the CSS parking lot have a dusting of soot within minutes. This may explain the absence of solar panels as they would need to be cleaned constantly.
The university, as the city’s largest employer, has a responsibility to consider its impact on the local economy when making land use decisions. The few blocks of commercial 4th street where CSS is located represents nearly 7 percent of the sales tax revenue in the city. All of downtown, a much larger area only a block west of campus, is 10 percent. Berkeley is unusual in that 14 percent of sales tax is generated by restaurants whereas in most other cities the figure is 10 percent. Very few at CSS frequent the restaurants on 4th Street as they are expensive. The range of restaurant options in and around campus is much greater, and hundreds of employees would have a measurable impact on the economy of the area.
Staff as partners
A primary reason for working at the university is to contribute to its noble mission of educating future generations and creating new knowledge for the benefit of all. Separating the management and administration from its academic and intellectual enterprise undermines a main motivation for employees, creates a caste system, and limits collaborative problem solving. We are not making widgets.
Most of the work undertaken by CSS is transactional: travel occurs and payment is made; a person is hired; or a purchase is required. Before a transaction comes decision-making. It is within the decision-making context that staff make major contributions. Because staff know the mission and culture within a unit, they know what will work. Decision-making in the sciences is often different than in the humanities.
In my own field of architecture we learned this long ago. Large rooms filled with draftsman (yes, they were mostly men) detailed the creations of designers who worked independently often on separate floors. Now architects work in collaborative teams wherein design and production is a seamless and iterative process. By combining all aspects of the process there is no disconnect between intention and execution.
Another benefit of being on campus is the joy of seeing faculty, researchers and young scholars in the learning process. Those in academic units have the opportunity of working with students on a daily basis helping them navigate their programs. Just working around campus or sitting in a nearby café one can feel the energy and dynamism. No matter how pleasant the working environment may be, working miles away limits both the opportunity for an employee to participate in, and to experience, campus life.
Is CSS working?
It is unclear CSS is saving the money intended, but I doubt it is. While there may be fewer employees overall, this savings must be offset against the cost of purchasing and operating the new building. Before CSS most employees were in buildings already owned by the university. (It is also unclear to me how a campus with major funding problems has the resources to buy the building.)
Employees that remain within units are burdened with additional work either to interface with CSS or simply to do the work because that is more expeditious than dealing with CSS. Faculty are also doing some of the work once performed by departmental staff. Staff members now report to those outside of the units for which the work is done, so oversight is disconnected from the end user. Even with severe funding problems, some schools and colleges have reverted to hiring additional staff either to deal with CSS, or because CSS is not responsive to their needs.
Some of these problems may be growing pains. Change is always disruptive, and no one disputes that operations were inefficient. My concern, however, is that by being detached both physically and intellectually from the campus, CSS will ultimately become like any other operations center. People will be attracted to the jobs not because of the greater mission of the public university, but rather because of good working conditions and benefits. Many of our long-term loyal staff have already left. Like Silicon Valley, turnover will increase as bright young employees find more meaningful or lucrative work elsewhere. Recurrent budget problems that result in layoffs will also increase turnover and make staff less loyal to the campus.
Alternatives – existing buildings and vacant sites
The ultimate goal should be to bring staff back onto campus where they can once again be full partners. It is still critical to run efficiently by streamlining processes and operations using technology, but it is unnecessary to have an entire silo of people handling the transactions that can be done at the unit level.
While bringing staff back onto campus, it is unlikely all will once again populate individual schools, colleges, and departments. As is already the case, some of the CSS units have satellite groups on campus. Where will they go?
There are several sites already owned by the University near campus, including office buildings. The university owns the Golden Bear Building on University Avenue. This“Class-A” office building has 120,000 square feet (the same as 4th Street) much of which is occupied by UC functions such as University Extension. Not all the current occupants have the need for direct contact with campus units.
Similarly, the university owns 2850 Telegraph Ave. Once primarily occupied by Berkeley Law, it has vacant space. While not quite as near to campus or BART as the Golden Bear Building, it is walkable to campus and on the bus line. Warren Hall, just across the street from campus, is currently occupied by the controller’s offices and may not need to be in such close proximity. Rethinking space allocation, rather than adding new space, may be a more efficient solution.
University Hall will be available when the new School of Public Health building is completed on Shattuck at Hearst. The architecture of University Hall is undistinguished, but much could be done to improve the interiors. It was, after all, designed as an office building. Better still, it could be razed and a new structure housing not just CCS, but also other administrative and organized research units currently leasing space.
There is also campus-owned vacant or underutilized land. The site west of the new aquatics facility is an excellent site. It is relatively flat, close to BART and buses, across the street from campus, and near downtown.
Why were these alternatives not considered? Timing. The campus was so keen on moving forward that it only looked at existing office space. The short-term goal took precedence over any long-term planning that might help both Operational Excellence and the nearby campus community.
This is unfortunate as the university is in a unique position to make sound planning and design decisions with broad impact whereas most business entities do not. Uber locating to downtown Oakland was its business decision, and now the City of Oakland must try to compel Uber to be a good fit socially and not just economically.
The university also lost an opportunity to create a state-of-the-art workplace that features sound environmental and ecological features.
It’s not too late
The university can sell 1608 4th St. and, given the current real estate climate, make a good profit, then use this windfall to undertake any of these options.
Before the purchase of 1608, the campus was paying slightly over $2 per square foot each month and the building is approximately 120,000 square feet. Rents throughout the Bay Area are increasing and the building has already been renovated, and as a result I would estimate the value of the building at $30-40 million.
Just as a comparison, Uber purchased its downtown Oakland building for $325/square foot and will add another $100/square foot to renovate. At $425/foot, 1608 4th St. would be worth $51 million. Not to get too crazy, but Salesforce purchased its Fremont building for $770/square foot, which would make 4th Street worth $92 million.
If the campus is intent on retaining the property, there are uses other than CSS. It could be converted into loft apartments for faculty. As I have mentioned in previous blogs, faculty recruitment is increasing difficult because of housing prices. The university needs to find innovative ways to overcome this obstacle.
A mission of a great university is to experiment and seek new knowledge. Failure is part of the learning process. It is clear that Campus Shared Services is less than expected. We should learn from this and develop a system that works environmentally, economically, and socially.