Research and Real Estate in the New Global University

An old New York saw has it that Columbia and New York Universities will continue buying up property in the north and south of Manhattan until they meet in the middle. But as the real estate dealings continue apace in New York and across the globe, pushback against NYU has intensified, from without and within. A group of faculty calling themselves NYU Faculty Against the Sexton Plan (NYUFASP)—as NYU’s 2031 expansion plan has been coined, after NYU President John Sexton—released a scalding pamphlet earlier this year called The Art of the Gouge, about the ways, evident and opaque, in which NYU overcharges its students in order to finance enormous construction and renovation projects. In this latest in a series of attacks against the administration by faculty of the school, the professors allege that the school acts largely without input from their academic faculty, and at the expense of the students’ education.

As the professors detail, the school spends billions investing in real estate (the whole plan is estimated by NYU to cost six billion dollars) with vague promises of future benefits in academics and quality of life through the addition of classroom space, living facilities, and international campuses. In the meantime, the professors charge, the buildings currently held by the university are underutilized and the property that NYU has bought globally to house its students overseas is highly overpriced. Students are footing ever-increasing bills to fund the projects: NYU’s cost is consistently rated as the highest or second-highest in the country, currently over $64,000 a year for American students and over $73,000 for international students. NYUFASP consider this difference exorbitant, charging that it is both unnecessary and a primary factor driving the expansion of NYU’s many-fingered Global Network University—international students are not eligible for financial aid. And lost in the larger sums under discussion is the nickel-and-diming of students with administrative fees plaguing each step of the matriculation process. Undergraduates pay, for example, up to $6,280 for January session courses (which at other universities are often free), and pay $2,424 for nonreturnable services and registration fees without obvious rationale.

The board, composed largely of real estate, law, and finance types—and not at all of professors—obscures the logic of expansionism behind glossy pronouncements gesturing toward their focus on building an international research institution. The professoriate counters that the focus is misplaced, and in 2014 the faculty of five schools—Steinhardt School of Culture, Education and Human Development; Gallatin School of Individualized Study; the College of Arts and Sciences (NYU’s largest); Tisch School of the Arts; and Singapore’s Tisch School of the Arts Asia—issued votes of no confidence in Sexton. The law school, where Sexton was dean before his presidency, contrastingly supported him in overwhelming numbers. Marty Lipton, whose time as chairman of the board will end this month, has also come under fire for his role. The board sets compensation levels for top administrators, whose salaries rose roughly 25% a year between 2010 and 2012, while faculty raises hovered near 2.5%, below the rate of inflation.

Outside the academy, residents of Greenwich Village have been resisting NYU’s local real-estate flexing; within, in addition to the professoriate, students are complaining (and, apparently, turning to prostitution in alarming numbers in order to make ends meet, which reminds me that transfer is also an option). The Student Labor Action Movement charges that NYU’s debt accumulation for NYU 2031 “amounts to students paying massive amounts for debt service with NYU serving as the middleman.”1 NYUFASP steering committee member Mark Crispin Miller sees the board as callous to students: “Clearly, it is distressing to know that so many students are suffering, working two or three jobs. To President Sexton, that’s a form of advertising for how desirable the brand is. For us, that’s a disaster!” NYUFASP quotes students in The Art who claim to be homeless, skipping meals, or dropping out because they’ve run out of money.

John Sexton and his board hope that their investments will bring NYU onto the world stage, pointing out that this process is already well underway. Lipton believes his time on the board helped transform NYU into a “modern global research university.”2 And Sexton envisions the NYC campus as the center of a global network that will house a cosmopolitan intellectual community, in the manner of artists and intellectuals straddling the hubs of the Italian Renaissance.3

Opponents charge that such language obscures the real goal, sucking money into each area of its multi-addressed maw. Further, NYUFASP dispute the claim of significant progress, pointing to figures for admission rate—a robust 34%—and to the stickiness of NYU’s college ranking in the US News and World Report in the low thirties through Sexton’s tenure. But much ballyhooed too is the effect on NYU’s brand as now communicating a world-class research institution, figures be damned. In a time of great uncertainty about how higher education ought to look, there is room to believe that the plan may well work, and that the long-term gains in reputation are significant. Last year, NYU received more than 60,000 applicants, a record number and more than double the number of applications in 2002, when Sexton took over. The Shanghai and Abu Dhabi campuses saw application increases of 31% and 26%, compared to last year. Whatever it is NYU is doing, potential students are noticing.

Of course, brand talk is business talk. NYU is thriving as a business: there are a record number of customers paying more than ever. And that does seem to contribute to the financial health of the university, whose endowment has roughly tripled over Sexton’s tenure to $3.5 billion at the end of the last fiscal year. There is more money to pay administrators and educators, which certainly cannot hurt a university hoping to lure top talent into its ranks.

But money does not an education make. Professor Miller charges that this has been forgotten by the board: “They run it like they run their other enterprises, which raises the question of what they think a university is. They see it as a fulcrum for real estate deals, and we don’t! We see it as a school.” And the disruption in campus life that comes from expanding pools of incoming freshman, and from two decades of planned construction in the Greenwich Village area professors and students live and teach and learn in, seems to some to be too steep a price to pay. NYU 2031, as the school’s planned expansion is called, has become a stand-in for a larger conflict. “The Sexton Plan has been the flashpoint in a larger conflict over the direction of this university—the straw that broke the camel’s back,” according to Miller. “The larger issue is the hijacking of this university by a board fixated on high finance and an administration basically controlled by that board.”

It remains to be seen whether the prognostications of the buck-eyed board will be borne out, or whether the professors and students will be successful in reining in the real estate wheeling and dealing and refocusing the administration on the nitty-gritty of classroom excellence. Perhaps Sexton’s tenure has already laid the groundwork on which excellent pedagogy can then be built. The idea of a “modern global research institution” here begs a second look: in a time of turmoil for higher education, of swelling of administrative ranks and student costs, of an increasingly restless professoriate, it is less clear than ever what that lofty-sounding label really signifies. In January, Andrew Hamilton, a chemist and vice-chancellor of Oxford, an ex-provost of Yale, will take the helm of the University, and this thorny question will be his to wrestle with. With NYU’s visibility as the largest private university in the country, in its global center of gravity, much will depend on how it is answered.



  1. Letter to the Board and Senior administrators, NYU SLAM.
  2. Fabrikant, Geraldine, “The Power Broker of NYU.” April 11, 2014, New York Times.
  3. Sherman, Gabriel. “The School that Ate New York.” November 14, 2010. New York Magazine.

Contributor

Samuel Feldblum

SAMUEL FELDBLUM is an armchair philosopher pondering getting out of his armchair.

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