Announcement: Continuing Construction at 524 Myrtle Avenue

TO: Pratt Institute Staff, Faculty, and Students
FROM: President Thomas F. Schutte
DATE: February 5, 2009
RE: Continuing Construction at 524 Myrtle Avenue

The recent economic downturn has forced Pratt and many other educational
institutions to make tough financial decisions. On January 1 of this
year, the Institute implemented a belt-tightening plan to curtail
expenditures and to ensure that enrollment and student financial aid
remained supported. Many of you have asked why Pratt, in light of these
efforts, has decided to continue construction on its new building at 524
Myrtle Avenue.

After a thorough analysis of the Institute's educational and financial
needs, Pratt's Trustees and administration determined that building 524
Myrtle at this time was necessary in order to be more financially
efficient in the long term and to guarantee the best quality education
and service for Pratt's students by providing much needed academic and
administrative space.

Pratt's most recent Strategic Campus Master Plan had determined that
space was insufficient to support academic and administrative functions
at the Institute today and in the future. The need for additional
classroom and studio space and a centralized student services area was
dire, and the opportunity to renovate existing space to more effectively
accommodate academic and administrative functions was impossible. These
deficiencies were putting severe strains on Pratt's faculty, students,
and staff. To address these needs, the Institute planned for a building
that would ameliorate a number of academic, administrative, and student
services issues. The total project cost is $64 million, which will be
financed by the sale of New York State Dormitory Authority bonds.

After reviewing several building sites, Pratt entered into a joint
venture agreement with the owner of the former Kentucky Fried Chicken lot
on Myrtle Avenue, which is contiguous to the main Brooklyn campus. The
contract provided for two condo units in our new Myrtle Avenue building-a
retail and educational condo with the retail condo occupying the first
floor and much of the basement. Pratt will own and occupy floors two
through five. These contractual agreements were executed in early 2007.

Assessing its contractual obligations and potential construction costs,
the Institute determined that delaying the construction would have
marginal benefits and would increase the final cost of the project. By
delaying the construction, Pratt would have incurred potential cost
penalties under the contractual agreement and also incurred costs to stop
and restart the construction project and to maintain the site during the
delay. In addition, the decreased cost of materials during this time will
result in economies that should enable the Institute to complete the
project within the budget and with the potential for further cost
reductions. Finally, when completed, the new "green" building at 524
Myrtle will have features that will result in significant long-term
energy savings to the Institute.

Members of the Pratt community who are interested in more information on
the 524 Myrtle Avenue project may contact Ed Coletti, executive director
of planning, design, construction and physical plant, at (718) 636-3579.

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