Averett University has secured approval from its bondholders to sell and lease back its athletic campus.
The vote also waives lingering violations on the university’s bond debt.
The private university in Danville announced Wednesday it had achieved the required 50% approval vote of bondholders.
“Now that the vote is complete, we can begin the process of closing on the sale/lease-back of the North Campus. We will update those steps when appropriate,” Averett President Thomas Powell said in a statement. “We would like to thank all of our bond holders who have supported us in this procedure. We look forward to moving ahead in our quest to create a dynamic and more efficient Averett University.”
A notice posted Wednesday on the website of the Municipal Securities Rulemaking Board, which enforces regulations on municipal bonds, confirmed the approval by bondholders.
North Campus is the primary location for Averett’s 20-plus NCAA Division III sports programs.
Averett took out nearly $15 million in bonds in 2017 to pay off old debts and renovate campus facilities. It has about $13 million remaining to be paid through 2047.
Those bonds were taken on before the financial crisis the university discovered in summer 2024, leaving it with a cash crunch.
Averett has been in nonmonetary default on its bonds throughout 2025. The university has been making payments on time, but violated the financial health standards established when the bonds originated.
In spring 2025, Averett began asking its bondholders to waive those standards while it rebuilds its finances.
In August, Averett added a new request to the waiver list: to allow the school to sell its North Campus property to regional investors and lease it back. The school would receive $18.15 million over three years; it would continue to use the facilities on the 70-acre campus and pay rent for 10 years at a rate equal to a 4.5% annual return on the investor’s purchase price.
The terms of Averett’s bonds required that a major transaction, such as the sale and lease-back plan, needed majority approval from bondholders.
The Danville Regional Foundation is the only investor the university has named as being part of the sale and lease-back plan.
Bondholder requests extended 3 times
The school extended its request three times before achieving the required majority vote.
The latest extension, dated Sept. 30, included more dire language than the previous notices. “Without majority Bondholder Consent, the University may be unable to implement essential financial measurements, jeopardizing its continued operations and long-term viability,” it said at the top in bold text.
That latest extension listed a deadline of Oct. 7. It said that 46% of bondholders had already voted, with 99.6% of those voting in favor of the university’s requests.
“The university needs the vote of Bondholders holding only an additional $510,000 in order to successfully complete the consent solicitation process,” the notice read. “EVERY vote, in any small amount, matters.”
“We knew this process of reaching bond holders could be drawn out beyond the original timeframe. These extensions are just part of this process,” Powell said Sept. 30 in response to a question from Cardinal News on how long the extensions could continue.
Cuts continue to reduce university expenses
The university has made a variety of efforts to shore up its finances since revealing in 2024 that its endowment funds had been misallocated over the course of several years.
[Read more: New Averett president says school is ‘so far from closing’ despite year of financial challenges.]
Cuts have included furlough days and staff layoffs, the elimination of academic majors with low enrollment and reductions in employee benefits. The university has sold a number of properties in Danville, including the president’s residence, and put its equestrian center in North Carolina on the market.
More recently, Averett eliminated paid volunteer hours for employees, according to an online newsletter for faculty and staff. It also eliminated on-campus mail delivery for university departments and now requires faculty and staff to pick up their mail from the campus mail room.