Acquiring and Disposing of University Real Estate

Responsible Officer
Michael Berthelsen
Vice President, University Services
Owner
Leslie Krueger
Assistant Vice President Planning, Space, and Real Estate
Primary Contact
Kelley Brandt
Director of Real Estate Transactions and Operations
Last Revised
Effective Date

Policy Statement

Regents of the University of Minnesota, a Minnesota constitutional corporation owns all University real estate (land, buildings, air rights, water rights, and mineral rights). Real estate is not by the collegiate or administrative unit that occupies or otherwise uses the real estate.

Pursuant to the Board of Regents Policy: Reservation and Delegation of Authority, the Board of Regents reserves to itself authority to approve the purchase or sale of real estate (i) having a value greater than $1,000,000, (ii) located on or within 2 miles of a University campus, or (iii) larger than 10 acres.

Acquisitions must support the University’s educational, research or outreach mission. Dispositions may occur when it is determined the real estate is no longer required, to fulfill the University’s mission, or the disposition of the real estate better meets the University’s needs or better supports the University’s mission.

Proceeds from the sale of restricted University real estate are used in accordance with the purposes designated by the donors. Proceeds from the sale of unrestricted University real estate are deposited to the appropriate Real Estate Acquisition Account for use by that campus or research center to fund future real estate acquisitions or other investments consistent with the University’s Strategic Plan, Campus Master Plans, or long-term Capital Plans. 

The Real Estate Office is responsible for University real estate acquisition and disposition transactions, including the process for review and approval of proposed transactions, the appropriate use of sale proceeds, and management of the Real Estate Acquisition Accounts. The Office of the General Counsel supports the acquisition and disposition process through the development or approval of real estate transaction agreements.

The Senior Vice President for Finance and Operations may grant an exception to this policy and associated procedure, provided the exception remains consistent with Board of Regents policy.  Any exceptions granted will be documented in writing.

Reason for Policy

By ensuring that all appropriate due diligence is made regarding the acquisition of proposed real estate assets prior to acquisition, the University minimizes its legal and financial exposure to claims for damages under applicable laws, including those governing the environment and hazardous materials. The policy also ensures that the University disposes of real estate in a manner that maximizes return, considers other public purposes and avoids conflict of interest.

Contacts

Subject Contact Phone Fax/Email
Primary Contact(s) and Overall Process Director of Real Estate Transactions and Operations  612-625-5345 612-624-6345
[email protected]
Acquisition and Disposition Transactions Director of Real Estate Transactions and Operations 612-626-0565 612/624-6345
[email protected]

Definitions

University Real Estate
Land (surface or subsurface), buildings (including space within a building), air rights, water rights and mineral rights.
University Real Estate Transactions
The process for acquisition or disposition of real estate, including an interest in real estate.

Responsibilities

Board of Regents
Has exclusive authority and power on behalf of the University to approve the purchase or sale of real property (i) with a value greater than $1,000,000; (ii) located on or within 2 miles of a University campus; or (iii) larger than 10 acres.
Senior Vice President for Finance and Operations
As delegated by the President, has signature authority for real estate agreements. The Senior Vice President for Finance and Operations has re-delegated this authority to the Assistant Vice President for Planning, Space, and Real Estate. The Senior Vice President has authority to grant exceptions to this administrative policy and associated procedure.
Real Estate Office
Responsible for all transactions involving the University’s acquisition or disposition of real estate or an interest in real estate, including permanent easements and street vacations, and dedications. Maintains a historical database of University-owned real estate and official land records.
University Health and Safety
Works with the Real Estate Office to ensure appropriate environmental investigations are completed for all real estate considered for University acquisition by purchase or gift acceptance, including estimates of remediation, as required.
Office of General Counsel
Develops or approves real estate transaction agreements with the Real Estate Office.

Related Information

History

Amended:
June 2022 - Comprehensive Review.
  1. Changes the property value thresholds in the Administrative Procedure to better align with University purchasing guidelines and Delegations of Authority.
  2. Provides clarifications regarding the process to be followed if a sale that had been offered via public process is not executed.
  3. Specifies that the Senior Vice President for Finance and Operations is able to grant exceptions to the policy, provided the exceptions are consistent with Board of Regents Policy.
Amended:
August 2018 - $1,250,000 lease threshold decreased to $1,000,000 to align with Board of Regents Policy: Property and Facility Use.
Amended:
October 2015 - Comprehensive Review, Minor Revision: 1. Clarifies that uses of funds in the Real Estate Acquisition Accounts may be used for the purchase of other capital assets/real estate. All other uses much receive approval by the President. 2. Provides more details around transactions under the Board of Regents threshold.
Amended:
August 2012 - Threshold limits increased from $250,000 to $1,250,000. All real estate transactions will now require a 2-month Board of Regents, Facilities Committee review/approval process.
Amended:
October 2005 - The words "must be approved by" changed to "must be reported to" in this sentence in the Policy Statement: Uses of the Real Estate Acquisition Account for purposes other than the purchase of real estate must be reported to the Board of Regents. Similar change made to procedure 3.14.3.1.
Amended:
July 2004 - Revised to reflect Real Estate Delegations Assigned in the Delegations Library. Added question 8 to FAQ. Updated appraiser requirements and marketing plans for sales in excess of $50,000. Responsible University Officer changed from Treasurer to Vice President for Finance and CFO.
Amended:
September 2003 - Revised to reflect Reservation and Delegation of Authority policy.
Amended:
November 1998 - Added Frequently Asked Questions section.
Effective:
March 1995

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