What Business Are You In?

I have been following the antics of the current MIT President and his moves into various venues. The last one was setting up a VC fund. Now I noted then that if the Institute chooses winners and losers then it may very likely have a deleterious effect. After all it is the real money folks who do that. I have walked away from dozens of deals before I select one to spend time with.

Now the next venture is Real Estate. As MIT notes:

On Tuesday, the U.S. General Services Administration (GSA) announced that the federal government has made “the initial selection of Massachusetts Institute of Technology (MIT) as the Exchange Partner for the Volpe Project. The next step of the process will be the joint selection of the Design Team by the federal government and the Exchange Partner for the new federal facility.”

Now the Volpe Center was a consolation prize for Massachusetts after President Johnson moved NASA to Houston. Probably a good idea, last thing Cambridge needed was another Government infrastructure. But now it appears that MIT with the East Campus and now Volpe will get into real estate. Where is Donald Trump when he is needed! Oh, forgot, it is that fear thing.

However real estate is real risk. Real big risk. If you want fear have a $750,000,000 development fall flat. Or have a 100% over-run. Can a University manage anything like this? Look at Harvard's endowment.

 Also perhaps one should look at NYU which bought up old buildings. But with MIT the intent is to totally renovate the area. What about the asbestos in the building folks, Remember Building 20!