A school is often defined by its surroundings -- Dartmouth has owned substantial amounts property in New Hampshire aside from the Hanover campus since the Second College Grant in 1807. The College goes one step further and invests a portion of its $3.092 billion endowment in real estate funds as part of its fiscal strategy.
Dartmouth acquired land in the area to "control the quality of what happens in the town and at the gateways of where the school is located," according to Larry Kelly, associate director of real estate at the College.
Sachem Village is one of the residential properties owned by Dartmouth to provide off campus housing for graduate students and undergraduate student families. This property is located in West Lebanon, about 1.5 miles from campus. Students lease the apartments from September through June with the option to keep pets in some of the older buildings. There are approximately 185 units which vary in price from $595 a month for a one bedroom unit without utilities to $1395 a month for a three bedroom unit including utilities.
"It's nice, it's really clean and it's not hard to maintain. You have however many bedrooms you apply for, a kitchen, living room, a bathroom. The only downside is that it's not furnished," said Tara Wohlgemuth '09, who is married and lives in Sachem Village.
Dartmouth owns two other subdivisions that it provides to faculty and staff in the Lebanon area. These houses are sold at below market value with the condition that after the person leaves the College, Dartmouth can buy it back at the original selling price plus a small Consumer Price Index adjustment. This investment makes it easier for professors to find and purchase property in New Hampshire where property taxes are notoriously high.
"That way we can keep it affordable in an expensive community like Hanover," said John Caulo, associate director of Dartmouth's real estate office.
The College also uses its real estate to attract retail stores to Hanover, improving the local economy and providing students with stores like the Gap for clothing and other apparel. College offices, including the real estate office, are also located in town.
South Street is currently being developed with buildings that house commercial properties on the first floor and apartments on the upper floors for students who choose to live off campus.
Dartmouth also uses real estate as part of its endowment strategy.
According to Kelly, it is common for universities and corporate and state pension plans to invest in real estate funds that are held for a period of seven to 10 years. These real estate funds can vary from high to low risk and encompass investments not only in the United States, but in areas like Western Europe and Japan.
"I think the College has something like 20 real estate investment managers who oversee as many as 50 real estate funds, totaling about 7 to 8 percent of the endowment," Kelly said.
Correction Appended
For the record: Due to a reporting error, an article Monday ("Real estate aids College, provides local controls," Oct. 23) incorrectly stated the College's endowment to be $14.4 billion when in fact it is aproximately $3.092 billion.
