Great Opportunities for Charter School Facilities

While the challenges of developing and operating Charter Schools in the current economic climate, there are some great opportunities for creating new facilities.

The combination of attractive interest rates on tax exempt and other appropriate financing mechanisms, and the growing number of distressed properties on the market, can offer some excellent solutions for facility needs.

NewSchools has provided facility strategies for Charter Schools during other economic cycles that offered these same opportunities, but none have offered the wide range of solutions that can be created today.  In the past economic downturns, when real estate and interest rates were attractive, the Charter School movement was in its comparative infancy and sources of financing were difficult to identify or secure.  While earlier cyclical market forces in retail properties made available through mergers and bankruptcies, there were few school operations creditworthy enough to access the relatively scarce sources of funding for facilities.

Some specific property types now appear to be readily available, and at steeply discounted prices.  While many retail properties have provided excellent core and shell values for many years, today's closing of large retailers who located in freestanding buildings offer even better starting points for adaptive reuse.  Retail properties are attractive in many cases because they offer significant value in not only the size and layout but also the capacity and condition of electrical and mechanical systems.  Other property types offer good value in the basic structure of the building, but when the improvements must include extensive building system investment, costs can soar.  The freestanding nature of some of these properties offer some benefits in security, traffic circulation and access to outdoor activity space, traditionally problematic in retail properties developed as "in line" space.

Office buildings offer interesting opportunities, particularly in freestanding properties.  Office properties in many areas are distressed, and can be acquired for cents on the dollar compared to replacement costs.

A new property type available in abundance is automotive.  While very non traditional, automotive dealerships offer some unique qualities: low cost, large land area, access to outdoor activity areas, and large volume spaces.

NewSchools is highly experienced with successful adaptive reuse development for Charter School facilities, and has access to excellent long term financing for acquisition and development.