Get sick, get well
Hang around a ink well
Ring bell, hard to tell
If anything is goin' to sell
-- Bob Dylan

Sunday, December 4, 2016

My investment tip for the DeVos era. Charter school real estate.

Clockwise from top left: the Coral Springs – Imagine School, Imagine At South Vero, Plantation – Renaissance Charter School, Championship Academy of Distinction Davie Campus, and Charter School Capital CEO Stuart Ellis

I'm thinking back to the time when hedge-fund school reformer Whitney Tilson mocked me for suggesting that he and his investment group were profiteering from privately-run charter schools.
"Trying to make a killing in the charter school business"?! Yeah, that's right, the charter school business is so profitable that I'm telling all my friends in the hedge fund business that they're in the wrong business. My message: "If you really want to make a lot of money, start a charter school!" LOL!
Turns out I was spot-on and he was covering up. 

So this is the time of year I like to hand out more free investment advice to my readers. You're welcome. 

With the appointment of Betsy DeVos as Trump's education chief, charter school real estate profiteers and corporate reformers like Tilson are rubbing their hands together with glee. This is a great time to get into that market while stock prices are still relatively low. 

Charter School Capital, an academic investment group based in Portland, just scooped up five charter schools spread throughout Florida for $71.74 million. The sellers were MG3 Development Group and ESJ Capital Partners, a pair of local real estate companies. The deal illustrates how investing in nontraditional real estate like schools can be lucrative, especially when other markets like residential and commercial properties appear to be cooling down. 
The deal breaks down to $17,935 per enrolled student. Not bad.

More from the Real Deal...
Despite their controversial status among educators, charter schools have become hot commodities in the real estate community, with a slew of new speculative projects breaking ground in South Florida over the past year. Notably, the W.P. Carey investment trust bought a Broward County preparatory school for $68.6 million in June as part of a larger $167 million deal to acquire three U.S. private academies.
Of course, if profiteering off of the lives of primarily poor, black and Latino students makes you puke or keeps you from facing yourself in the mirror, I would suggest you find another area of investment.  

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