After the East Allen County Schools board heard a consultant’s report last week recommending changes in the way the board does business, President Neil Reynolds suggested a next step that is all too common among Indiana’s local electedThe mayor of Indianapolis’ charter school office rejected Imagine Schools’ application to open two schools there in November 2006. The mayor’s report on Imagine said the company proposed a building lease deal that was so costly “it could make it difficult to adequately fund their academic programs.”
Imagine promptly submitted its application to Ball State University’s charter school office, where officials approved charters for the schools without contacting the mayor’s office.
“One of the reasons we like it is because it’s not an easy industry to penetrate and understand and do on a national scale. However, once you’ve made the investment and have the understanding and infrastructure in place, we believe it offers terrific opportunity for us. Returns on our charter schools are really comparable to what we see in theaters – in the high single digits to low teens, depending on where in the life and so forth these schools may be.”
– Jerry Earnest, CIO for Entertainment Properties Trust, the real estate investment trust that owns the Imagine School property on Wells Street and two Indianapolis charter school properties, explaining in a video annual report why the company finds charter schools an attractive investment
“(A)s yet, I have not found a benefit for the school to lease its facility from a (real estate investment trust). There are many of these REIT/(education management organization) partnerships that remind me of a couple of vultures feeding off of an emaciated carcass. I cannot count how many schools have called me about how to get out of a bloated EMO contract and/or similarly bloated lease contract.
“While there are superb Education Management Companies with fair prices that I heartily recommend, there are others I would never recommend, because they are neither good at what they do nor are their fees reasonable. I have yet to discover a REIT that offers fair value to a charter school when compared to financing a purchase of their facility.”
– Brent Van Alfen, financial consultant and broker to charter schools, in the April 2010 “Charter School Business” newsletter
