Observers of higher-education turnarounds have watched High Point University with no shortage of fascination. Since a business entrepreneur took over as president of the institution, the university has added some fairly radical features to campus life in an attempt to attract students. The most famous of those frills is an ice-cream truck that makes rounds on the campus, but The Chronicle has also reported on valet parking, a concierge desk, a hot tub, a steakhouse, personalized birthday calls from the president, Nido R. Qubein, and other features not often seen in academe.
High Point has tried one common ploy: The university built some $500-million worth of snazzy new stuff, and is planning an additional $1.6-billion in construction, reports the Greensboro News & Record. Buildings certainly play a role in attracting students, ”but might HPU come to regret its rapid-fire growth in the midst of America’s worst economic crisis in generations?” the newspaper asks. High Point has racked up a lot of debt for a small college, the article says:
Both Moody’s and Standard & Poor’s financial-rating agencies sent up caution flags about HPU in the past 18 months, in part concerned about the heavy long-term borrowing that fueled the school’s growth spurt.
“Total debt outstanding was about $167 million as of December 2009, up 109 percent from $80 million in total debt on May 31, 2008 …” S&P analysts said in their report late last year. “Projected maximum annual debt service of $19.1 million—including term-loan payments—equaled an exceptionally high 26.6 percent of fiscal 2009 operating expenses.”
High Point administrators told the newspaper that the rating agencies had “overreacted.” The officials said they have a solid plan to pay down the debt.Return to Top