A few weeks ago, the University of Massachusetts System made headlines when it allowed its flagship campus in Amherst to buy a cash-strapped private liberal arts school, Mount Ida College, for $75 million and an extra $11 million to satisfy the outstanding debts which would’ve sent the college into bankruptcy without the purchase.
The deal will convert Mount Ida into an undergraduate workforce development extension of the Amherst campus, which enrolls more than 30,000 students. It drew criticism from stakeholders of its sister campus, UMass-Boston, which has struggled in recent years to sustain enrollment and to survive massive budget cuts.
The fight for UMass-Boston got even harder this week, when system officials announced that the school’s presidential search would be indefinitely postponed after the three finalists for the position, two of them African Americans, all withdrew from the search following extensive criticism from faculty.
Basically, it is a metropolitan campus waging war against a system for building up its flagship campus, while its most diverse campus languishes from a lack of resources and perceptions of disrespect.
The story is important because public higher education systems across the country are concerned with saving money and building preeminence to compete for students, grants and contracts, and branding. It is critical for HBCUs because if it grows as a common practice among other systems, it could mean easier paths to the consolidation of HBCUs and predominantly white institutions, or struggling private HBCUs making deals to satisfy debts and to pay off executive stakeholders.
HBCUs with low enrollment and high debts are at risk for states’ merger considerations and deal making from private investors. And not surprisingly, many of the cities and counties where struggling HBCUs are located are among the fastest-growing areas for residential and commercial real estate.
St. Augustine’s University has cut dozens of positions, sold and leased campus properties and has seen enrollment drop by more than 500 students since 2012. It is in the second year of accreditation probation for problems with finance and institutional effectiveness. At the same time, Raleigh has emerged as a thriving market for commercial and residential real estate development. From the News & Observer:
Since 2014, an average of 1 million square feet of office has been built each year, a rate that puts the Triangle on pace to exceed 50 million square feet of space by 2020, putting it on par with the amount available in Charlotte, said Paul Hendershot, director of research for the Carolinas.
On top of that surge in office construction, more than 13,000 apartment units are expected to be built by 2020 to absorb all of the new transplants attracted to the area for jobs. Local officials often cite the fact that 63 people are moving to Wake County per day and 20 to Durham. That growth has brought a lot of change to the area and will continue doing so for the foreseeable future.
Stillman College faces an extraordinary uphill battle in securing financial stability, but Tuscaloosa’s economic development prospects are booming in large part because of growth at the nearby University of Alabama. From the Tuscaloosa News:
With UA’s student enrollment jumping from about 33,000 in 2015 to almost 40,000 in 2017, construction of student housing and apartment projects hasn’t slowed down.
Currently, the development called “My House on the 50” — a 44-units, 155-bed development with four stories of apartments and 2 stories of above-grade parking is under construction at Frank Thomas Avenue and Eighth Street.
And The Hub at Tuscaloosa, a 188-unit, 485-bedroom development that’s expected to reach almost 75 feet in height is now going up on Red Drew Avenue just off the Strip.
Flagship institutions are no longer competing with smaller niche schools or even fellow campuses within their own systems. They are buying them or buying everything around them to expand their geographic imprint, in order to compete with other states in the race to be one of the 1000 or so campuses that will likely survive the bursting of the higher education bubble.
Private schools like St. Augustine’s and Stillman, for all we know, may have already struck deals for loans or consolidation or buyouts with larger institutions, developers, or cities to annex their land and facilities upon the announcement of an accreditation revocation, or a capital loan default.
Schools like Cheyney University, Elizabeth City State University and even Fisk University are in prime real estate markets and surrounded by aggressive public systems of higher education, with players from both worlds waiting for trustees and/or legislators to say ‘yes’ to the right number to transform hundreds of years of black history into multi-million dollar investment properties.
UMass-Boston may be hundreds of miles away, but its fate is right at the doorstep of several proud HBCUs.
congrats to Dr. Mario Azevedo