Two business schools recently received gifts or pledges in excess of US$100 million:
- The College of Business at the University of Illinois at Urbana-Champaign has announced a US$150 million gift from alum Larry Gies and his wife, Beth. In recognition, the school now will be known as the Gies College of Business. The investment will be used to strengthen existing undergraduate and graduate programs and allow the school to invest more heavily in technology. Larry Gies is the founder of Madison Industries, a private equity firm that buys and grows middle market companies. The gift is the largest one ever received by a school in the University of Illinois system.
- The Shidler College of Business at the University of Hawai‘i at Mānoa in Honolulu has announced that alum Jay H. Shidler has donated US$117 million in cash and real estate ground leases to the school. This new gift comes immediately after Shidler delivered the final installment of the $111 million gift he announced in 2014, bringing his total gift to $228 million. School officials say the latest donation will support the improvements and expansion facilitated by Shidler’s earlier donation. It also will provide a level of steady funding that could be used to make the college tuition-free within 40 years if the school decides to pursue that goal.
The new gift is centered on the donation of land underlying 11 office buildings in the commercial business districts of major inland cities, including Seattle, Washington; Denver, Colorado; Chicago, Illinois; and Tampa, Florida. The gift of land, along with its attendant ground leases, is projected to produce a lasting source of capital that historically increases faster than inflation.
To ensure the long-term nature of the gift, Shidler has stipulated that the university cannot sell any of the donated ground leases before the end of their 99-year terms. Shidler estimates that the ground leases will generate a minimum of $2.1 billion of contractual cash flow for the college. At the end of the ground lease terms, the college receives full ownership of the related office buildings, which together with the land will be worth an estimated $5.1 billion. In total, this gift of land and commercial buildings could yield a minimum of $7.2 billion during the life of the current leases.