In the basement of a new 4 storey Faculty under construction, a question of appropriate type of transformer to be used was raised. Oil Type or Dry Type? What are the limitations
For both and which one is frequently used in basement? Basement is -3.5 below ground.
Please advise.

It's basically up to the AHJ. Oil filled transformers are more reliable, but you may have to use a nonflamable oil in a basement application. They may also generate less heat and noise.

Subpanels will typically use the dry type of transformer if needed. e,g, a Machine Shop or if some weird voltage is required for imported equipment.