Massachusetts is home to some of the nation's most prestigious colleges and universities. No matter what their size, each college and university in the state has its own rich and unique history and outstanding reputation. Given that historically mergers between colleges and universities have been rare, Massachusetts residents may have been surprised to hear that Wheelock College, established in 1888, is considering merging with the much larger Boston University.
However, mergers like this are becoming more commonplace nationwide. They offer small schools that are struggling a way to stay afloat financially. There is more pressure on all colleges and universities to increase enrollment and become more economical. By merging, colleges are able to combine their resources in a financially responsible manner that also gives them a boost in the number of students enrolling in their programs.
There are some small colleges that are fortunate enough to have a strong reputation internationally and large endowments. These schools may still be able to remain competitive. However, many small colleges, especially those that do not offer a wide variety of degrees or those that focus on lower-paying careers, do not always see the same number of donations.
These schools, however, do have something to offer -- their real estate. Some may be able to either sell or lease their real estate, giving them the funds needed to reinvest in their programs. This is especially true in areas such as Boston where the price of real estate has soared. Therefore, a small college sitting on prime real estate may be an attractive merger partner to a larger university looking to expand.
Many professionals are keeping an eye on the potential Wheelock-BU merger. In the meantime, those who are wondering whether a merger is right for them or who are in the process of pursuing a business merger may want to make sure they are represented by an attorney, so that their rights are protected.
Source: Boston Globe, "Why are so many colleges merging? Money and real estate," Deirdre Fernandes, Sept. 21, 2017