What is the purpose of a building reserve fund?

The primary purpose of a building reserve fund is to accumulate financial resources specifically for future construction projects or major renovations. This fund is essential for long-term planning in educational institutions, enabling them to set aside money over time to support the development of new facilities or upgrades to existing ones. By strategically allocating a portion of the budget to the building reserve fund, schools can better manage and execute large capital projects without relying solely on immediate funding or incurring debt. The establishment of such a reserve allows institutions to ensure they have the necessary finances available when construction opportunities arise or when building needs become evident.