The troubled parent company of Heald College has confirmed its Honolulu campus on Kapiolani Boulevard is up for sale as the for-profit education company divests its interests in schools nationwide.
Corinthian Colleges Inc., which operates 97 campuses across the country, agreed to sell or wind down operations after federal regulators cut off its access to student loans and accused the company of altering students’ grades and falsifying graduates’ job placement claims.
The company has put 85 schools on the market, including all 12 Heald campuses — 10 in California and one each in Oregon and Hawaii. It also has 12 schools in Canada.
"The normal and customary operations of Heald Honolulu are continuing," said Kent Jenkins Jr., Corinthian’s vice president of public affairs communications, adding that the school is still enrolling students. The next academic quarter begins Monday. "The goal is to find a buyer for all campuses, including Honolulu, who will be able to continue operating and serving these communities."
The company intends to complete the sales process in the next six months, but wouldn’t disclose any potential buyers for the Honolulu campus.
Heald, which recently celebrated its 150th anniversary, has a "very long and distinguished history in serving students, a very attractive feature for potential buyers," Jenkins said. "We’ve had many organizations express interest in purchasing our campuses."
He couldn’t place a value on the Honolulu campus and said most of Corinthian’s schools are in leased space. The land under the Kapiolani Heald campus is owned by Walgreens, which is building a new flagship store next door.
"A buyer would be purchasing the ongoing operations of our school," Jenkins said.
There were 1,700 students enrolled at the Honolulu campus in fall 2012, according to the most recent figures on the College Navigator website. Tuition and fees were estimated at $13,620 for the 2013-2014 school year for full-time beginning undergraduate students.
Jenkins didn’t provide an employee count for the Honolulu school and wouldn’t address potential layoffs.
Corinthian Colleges, based in California, relies heavily on student aid dollars to stay in business. It gets $1.4 billion a year in federal student loans and grants, according to the U.S. Department of Education. The department put a 21-day freeze on that revenue stream after the company failed to address concerns about its practices.
"We experienced a significant cash shortage" after the hold on reimbursements for federal education funds, Jenkins said.
Heald Honolulu administrators are telling prospective students the school is in good standing and will likely be sold. In the worst-case scenario — if the school were to shut down — the money students borrowed from the federal government would be forgiven, a school official said.
Mike Van Lear, president at Heald’s Kapiolani campus, recently informed students about the school’s intention to find a new owner, said Renee Castle, 36, who returned to Heald this year for a second degree in medical assisting after earlier earning a pharmacy technician diploma.
Van Lear would not comment.
"They’re looking for somebody to buy out the Heald campus so we don’t have to worry about our education, our credits, our financial aid," Castle said.
"I think it’s good. We don’t have to worry about the actual school going under."
Honolulu Business College opened in 1917 and continued in 1934 with the establishment of Cannon’s School of Business. The campus joined the Heald College group in 1993, according to its website, and offers degrees in the health care, business, legal and technology fields. Heald College was founded in San Francisco in 1863 by Edward Payson Heald.
Separately, Apollo Education Group, the parent of the University of Phoenix, which also operates in Hawaii, announced the U.S. Department of Education will review its administration of federal student financial aid programs.
The for-profit educational institution said Monday that the government review, which is scheduled to start Aug. 4, will cover the University of Phoenix’s compliance with laws governing campus security and crime statistics and drug policy.
