By Amy Sharaf
Ryerson President Claude Lajeunesse hopes for a bidding war to break out over the naming rights of the business building, an expectation not shared by a finance expert from the University of Toronto.
Ryerson has the last major unnamed business faculty in Canada, a faculty that will soon have a facility on Bay Street.
With the naming rights set at $15 million, Lajeunesse hoped interested buyers would throw money at Ryerson for the chance to have their name associated with the school.
“We just hope there’s a bidding war and it goes even higher.”
He added the building will generate more interest because of its prime location in the heart of Canada’s business hub.
“I think all of that together means that we’re looking at $15 million-plus, I hope,” Lajeunesse said.
However, Dan Lang, a professor of finance at U of T, said the asking price won’t be as easy to get as Lajeunesse hopes, even if Ryerson offered an MBA program.
“I think the business community, generally speaking, is less interested than it once was,” he said. “Raising money for business buildings in 2004 is a lot harder than it would have been in 1994.”
If the hoped-for bidding war does not happen, Lang said that as each additional brick is laid, the chance of meeting the fundraising goal drops.
“[There is a] risk of not getting the money you wanted as the building goes up because donors don’t see the urgency,” he said. “It is much harder to raise money for a building that’s already been built.”
Ryerson could find itself with two unnamed buildings if the money is not raised soon. The naming rights to the engineering building have also not been sold. Ryerson slashed the asking price from $15 to $10 million and the building continues to operate without a corporate name.
“Quite clearly at the time we thought that $15 million [was fine],” Lajeunesse said. “We found out with experience that $10 million would be more appropriate.”
Though the names of both buildings were originally set at the same price, Lang said the bid for the engineering building was low in comparison.
“The cost per square foot of an engineering building is probably double that of a business building,” he said.”A business building is just an office building…you can make it look nice.”