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What’s up with Concordia University? Shut down two years ago, it still sits empty. Looks like ready-to-move-in housing to me! What bureaucracy is preventing people from living there? —Confused in Concordia
This job has taught me three things: Don’t put used pizza boxes in the recycling, you’ll never go broke betting against Snowpocalypse, and if something valuable seems abandoned, it’s because somewhere two or more parties are fighting over it.
But let’s not bury the lede. Assuming a newly pending sale goes through, the Concordia site will soon house a University of Oregon satellite school called the Ballmer Institute for Children’s Behavioral Health, or BICBH. (So close! Obviously, I would have gone with “Ballmer Institute for Troubled Children’s Health.”)
So, the site finds a tenant and all is well. Had you asked your question in 2021, however, I would have described a Reservoir Dogs-style three-way standoff between zombie Concordia; the Lutheran Church Extension Fund, to whom Concordia owed $37 million in defaulted loans; and HotChalk, the tech company that ran Concordia’s briefly burgeoning online degree program and now claims the defunct university owes it $300 million (for which it’s suing).
The argument seems to have been over (among other things) who had the right to sell the campus and which debts the proceeds should cover. The property’s long vacancy allowed this to be hashed out. Case closed. (Update: Or not.)
If you’re like me, however, you may still be wondering how Concordia ran up a $300 million room service tab with its web developer. (You’re also drunk and not wearing pants, but that’s less important.) Were Concordia just deadbeats who never paid HotChalk for its services?
Nope! In fact, by the end HotChalk was pocketing about half of Concordia’s tuition dollars. But their contract stated that if Concordia ever ended the relationship “without cause,” it’d owe HotChalk a severance equal to three years’ revenues. To me, this sounds a lot like a health insurance company charging you an extra three years of premiums for dying, but what do I know?
In any case, LCEF bought the Concordia campus, and now may or may not be on the hook for the HotChalk debt. Don’t feel too bad for the Lutherans, though—the property they paid $3 million for last summer is about to sell to UO for $60 million. Also, they’re all going to heaven, so they’ve got that going for them, which is nice.
Questions? Send them to dr.know@wweek.com.
