Financial challenges at management universities, secondary schools and elementary schools can lead to unpleasant outcomes for students, staff and even alumni.
In extreme circumstances, public school districts will close campuses and lease or sell properties when they no longer need them.
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When it comes to private schools, financial distress can lead to school closures, campus sales and, in some cases, bankruptcy filings.
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Major public universities have recently announced that they will be closing a third of their satellite campuses as a result of growing financial agenda and declining registrations.
Penn State University, Pennsylvania State, announced in May 2025 that it would close seven of its 20 campuses in DuBois, Fayette, Mon Alto, New Kensington, Shenango, Wilkes-Barre and York.
Students who have not graduated from 2026-27 will be counselled about their degree completion options and transfers to other Pennsylvania campuses.
Two private universities, St Andrews University in North Carolina and Limestone University in South Carolina, announced in April that they would close at the end of the spring 2025 semester. Both condemned the financial difficulties of their end mise.
University and university merge
In March and April, several universities and universities mergers were revealed in March and April by institutions looking for answers to the decline in registration. The University of Georgia System said in April it would merge East Georgia State University within the Southern Georgia University.
Villanova University in Pennsylvania announced in March that it would merge with Rosemont University and eventually become Villanova University Rosemont University.
In March, Cornish College of Arts in Washington announced that it would change its name after its sale to Seattle University and become Seattle University’s Cornish College of Arts.
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Highland Education Files for Bankruptcy Protection
The chain owner of a huge educational institution that once managed the world’s largest Montessori school, Kochi Education Co., Ltd. filed for Chapter 11 bankruptcy and submitted a restructuring assistance agreement that would pass all its capital to a pre-added, secure lender.
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The Houston-based debtor cited assets and liabilities of between $100 million and $500 million.
Higher Ground Education’s largest unsecured creditors include Strike Inc, which has over $13.2 million for GuidePost Financial Partner LLC, over $1.49 million for 775 Columbus LLC, over $939,000 for 214 E. Hallandale Beach LLC, and over $834,000 for Strike Inc., which has over $834,000 for 214 E. Hallandale Beach LLC.
Under a restructuring assistance agreement between the debtor, equity holder and lender, Investor 2HR Learning Inc. will provide debtor ownership funds, which consist of $8 million in new money and a rollup of $2 million in pritification bridge loans, in exchange for all debtor shares.
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Founded in Southern California as a Montessori school network, the debtor began building the system in 2018 with 12 schools, expanding globally to 101 by 2022, and by the fall of 2024 it became the owner of the world’s largest Montessori schools with over 150 schools.
The debtor operated Montessori schools under several brands, including Guide Post Montessori, Beacon Elementary School, Advanced Study, Tinicare and Neighbors.
The debtor has not been able to maintain and generate enough liquidity to fund the business since it opened, according to a declaration by the president of Jonathan McCarthy.
After several pre-measurement foreclosures and negotiation sales, the ownership of the Montessori School debtor plunged into seven facilities on the petition day.
Since 2020, the company has raised $335 million in funding, but the business has never generated any positive cash flow from its business. The company reported losses of $55 million in 2024, losses of $103 million in 2023 and losses of more than $106 million in 2022.
Highland Education lost $24.8 million by April 2025.
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