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The monthly Dean's Desk column showcases reflections and commentary from Schulich’s thought leaders on the latest emerging trends in management and the world of business.
Driving Real-World Solutions for the Real Assets Sector
Schulich recently launched the new OMERS & Oxford Real Assets Leadership Institute – a dynamic initiative with an ambitious mission to solve some of today’s most urgent challenges in real estate and infrastructure.
The Institute aims to play a role in shaping the communities of tomorrow while advancing Schulich’s reputation as an international hub of excellence in real estate and infrastructure. With a strong focus on applied research, the Institute will also nurture top talent – future leaders who will drive meaningful change in the industry – and promote partnerships involving industry, government and academia.
Leading the charge is Joseph Ogilvie, the new OMERS & Oxford Chair in Real Assets and author of this month’s Dean’s Desk column, who explains how the Institute will serve as a collaborative hub for innovative, actionable outcomes related to critical issues like net-zero economic transitions, housing affordability, and community resilience.
I invite you to read more about the Institute’s vision and the opportunities it creates for practical, real-world solutions for the built environment.
Best,
Detlev Zwick, PhD
Dean, Tanna H. Schulich Chair in Digital Marketing Strategy
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Schulich’s OMERS & Oxford Real Assets Leadership Institute: Collaborative Solutions for the Built Environment
In early May of this year, the Ontario Municipal Employees Retirement System (OMERS) and its real estate subsidiary, Oxford Properties, jointly announced the launch of a new Leadership Institute at Schulich School of Business.
A reception of specially invited guests at OMERS’ global headquarters in downtown Toronto heard OMERS President and CEO Blake Hutcheson speak to the need for more real estate and infrastructure leaders who can “… not just read the music, but who can truly feel it.” Hutcheson pointed out that while real estate and infrastructure remain asset classes that continue to benefit from strong macroeconomic tailwinds, the investment environment continues to evolve, requiring leadership to evolve as well.
During remarks I delivered at the launch, I cited three synergistic areas of opportunity for leadership and investment that the newly established Institute would lean into: the economic transition to net zero emissions, urban housing affordability, and the resilience and vibrancy of our communities. I also pointed out that the governing paradigms and business models of the past are no longer sufficient to confront the scale and pace of opportunity at hand; and that new collaborative approaches among government, industry and academia have the potential to create new solutions at scale. Underpinned by applied research with industry partners and funded by government programs, the Real Assets Leadership Institute aims to avoid the trap of becoming yet another ‘think tank’, opting instead to be a ‘do-tank’ – an objective, fact-based, project-centric, scale-up vehicle for new business models in real estate and infrastructure.
Consider the following for context: post-COVID, governments across the developed world racked up record levels of debt, brought on by unprecedented levels of quantitative easing and economic stimulus coordinated by central banks. Canada, the UK and the US have monthly debt service costs of $4B CAD, 5.5B GBP and $100B USD respectively – amounts that climb as their fiscal deficits grow. This reality illustrates the constraints on governments’ ability to act unilaterally on major initiatives related to transitioning the economy to net zero emissions, housing affordability and community resilience. As such, private sector partnerships are a key mechanism for addressing these issues, provided that any undertakings can be structured to make the risk-adjusted returns sufficiently compelling.
Public-Private Partnerships are essential given that, unlike governments, institutional and private investors have balance sheets that have averaged 20% year-over-year growth from 2018 to present with $13 Trillion USD in capital under management and a growing array of options for capital allocation. Securing target returns requires the timely and efficient deployment of capital into the right investments; a balancing act that leaders must get right, and very often that efficiency means writing larger cheques.
Writing larger cheques, however, comes with checks and balances. The old investing mantra, “First test, then invest”, is where the Institute sees its purpose and opportunity: to act as business model innovator, convener, and scale-up facilitator. Already seeded with Schulich Urban Lab’s applied research on project return amplifiers, as well as new digitally enabled project delivery models, asset resiliency considerations for portfolio construction and more, the Institute is building on established partnerships with CMHC, Infrastructure Canada, Oxford Properties and Plenary Group to scale-up new approaches.
Anchored by Schulich’s ecosystem of Centres of Excellence, a vast network of professionals and academics in real estate and infrastructure, and its world-class cadres of graduate students and researchers from around the globe, Schulich’s new OMERS & Oxford Leadership Institute in Real Assets is poised to be an important platform that helps shape the evolution of our built environment.
Joseph Ogilvie
OMERS & Oxford Chair in Real Assets
Director, OMERS & Oxford Real Assets Leadership Institute