B-School Opening Delayed to Fall 2009
Vilas Nair
Issue date: 3/31/08 Section: News
Students and faculty must bear another year of obnoxious drilling and classes in Mason Hall because construction on the new business school has been delayed indefinitely. A construction workers' strike coupled with questionable financing tactics has likely delayed the opening of the building for a whole year. Campus residents expressed their dismay at having to stare at an empty, obnoxiously orange shell on the corner of Hill and Tappan for another year. This Monroe Street Journal exclusive article probes the issues at hand and prophesizes when students can finally revel in the glory that will be the new business school.
A construction workers strike is one of the factors delaying progress on the business school. A welder from the Local 86 Union shared his views on the strike with the MSJ. The welder, who asked not to be named, essentially blamed the strike on the GSI strike that occurred the previous week. "Look - we saw them just taking it easy for a few days, singing songs, and marching around campus. We figured we'd do the same" said the worker in an interview. The construction workers are holding out until they receive a pay increase. Since workers have not been seen "marching around campus" or protesting sub-standard wages, many students are wondering what they are doing (in an unrelated note, daytime ratings for NASCAR have skyrocketed). Ross School of Business officials declined to comment on the strike other than to express their disdain for organized labor. In an effort to get construction started again, a team of MBAs from MO 512 (Bargaining and Influence Skills) is hoping to help successfully resolve the dispute.
Compounding the effect of a strike is the questionable financing used to pay for the building. The estimated $147 million cost was financed by a combination of investments in Bear Stearns' hedge funds (defunct), Citigroup stock (down almost 60%), CMOs (don't ask), and money from Stephen Ross. These questionable financing options were chosen for their tremendous upside (what are the chances a twice bankrupt used car salesman in Akron wouldn't make his monthly payments if his rate jumped from 1.25% to 12% overnight?).
When asked why the school did not take out a loan to fund part of the construction, an official commented that loans are "so 20th century." Either way, it appears that another $20 million or so in financing will be needed to complete the building (if construction workers return from strike). Other options being explored include corporate sponsorships of classes (Accounting 391 - Introduction to Audits brought to you by Arthur Andersen) and increasing tuition (again). To avoid this sort of problem in the future, administration is examining its risk management practices and seeking out more stable investments.
The workers strike and financing issues have left students and faculty wondering what to expect come next school year. Apparently, students will have to wait another year for the much-anticipated nap room and executive gym. In the mean time, administration urges students to work hard for finals and never, under any circumstances, drink in Kresge.
Editor's Note: The following article is a fictional story to celebrate April Fool's Day!
A construction workers strike is one of the factors delaying progress on the business school. A welder from the Local 86 Union shared his views on the strike with the MSJ. The welder, who asked not to be named, essentially blamed the strike on the GSI strike that occurred the previous week. "Look - we saw them just taking it easy for a few days, singing songs, and marching around campus. We figured we'd do the same" said the worker in an interview. The construction workers are holding out until they receive a pay increase. Since workers have not been seen "marching around campus" or protesting sub-standard wages, many students are wondering what they are doing (in an unrelated note, daytime ratings for NASCAR have skyrocketed). Ross School of Business officials declined to comment on the strike other than to express their disdain for organized labor. In an effort to get construction started again, a team of MBAs from MO 512 (Bargaining and Influence Skills) is hoping to help successfully resolve the dispute.
Compounding the effect of a strike is the questionable financing used to pay for the building. The estimated $147 million cost was financed by a combination of investments in Bear Stearns' hedge funds (defunct), Citigroup stock (down almost 60%), CMOs (don't ask), and money from Stephen Ross. These questionable financing options were chosen for their tremendous upside (what are the chances a twice bankrupt used car salesman in Akron wouldn't make his monthly payments if his rate jumped from 1.25% to 12% overnight?).
When asked why the school did not take out a loan to fund part of the construction, an official commented that loans are "so 20th century." Either way, it appears that another $20 million or so in financing will be needed to complete the building (if construction workers return from strike). Other options being explored include corporate sponsorships of classes (Accounting 391 - Introduction to Audits brought to you by Arthur Andersen) and increasing tuition (again). To avoid this sort of problem in the future, administration is examining its risk management practices and seeking out more stable investments.
The workers strike and financing issues have left students and faculty wondering what to expect come next school year. Apparently, students will have to wait another year for the much-anticipated nap room and executive gym. In the mean time, administration urges students to work hard for finals and never, under any circumstances, drink in Kresge.
Editor's Note: The following article is a fictional story to celebrate April Fool's Day!
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