Q&A: VUB’s fundraising innovation finances renovations
The Free University of Brussels (VUB) has recently launched itself on the stock market – or has it? VUB Rector Paul De Knop explains
A good investment
Why did VUB launch on the stock market?
VUB has not launched on the stock market. What we did was we found money in the private sector, such as from insurance companies and other private institutions, for improving our facilities. We now have €61.5 million to finance our construction projects. But there are no “VUB shares” being bought and sold on the stock market.
Can you clarify then how the stock market is involved?
These private sector companies are basically lending money to the university via VUB bonds listed on the Brussels Euronext exchange. Instead of getting a loan from a bank, we are receiving loans from private institutions for building our facilities. This is the first time this has been done in Europe.
There are two kind of loans: at 1.4% over 15 years and at 1.6% over 20 years. It’s very cheap money. With a bank you pay more than 2% interest. So there are four different loans, in the form of VUB bonds, that can be followed on the stock market. But it’s not VUB itself that is going on the stock market.
Are other universities following your lead?
Yes, Ghent University is considering doing something similar, and I’m also getting calls from universities in the Netherlands that want to know more. It took me three years to arrange this, to assure the private sector that it’s safe to give loans to a university, especially one with a 180-year history. The companies decided, along with the banks, that it’s a good investment.
What facilities will the money be used for?
We will build new 600 units of student housing on campus, 3,500 square metres of educational space, research facilities and a new culture tower with a concert venue and exhibition space. We’re also going to renovate our swimming pool.
Photo courtesy VUB
Free University of Brussels (VUB)
Master’s programmes offered
million euros in research budget in 2010
students in 2011-2012 academic year