Hawai’i Pacific University’s Bold Financial Moves Seem To Be Paying Off

In early 2020, even before the coronavirus pandemic hit, Hawaii Pacific University was at a crossroads.

Enrollment at Hawaii’s largest private university had plummeted more than 50% over the previous decade, and revenue had dropped steeply, leading to long-time salary freezes for faculty.

On top of that, HPU had made bold, risky moves, taking on a mountain of debt to lease and renovate the state-owned Aloha Tower Marketplace to build facilities for student housing, dining and activities, as well multipurpose rooms for classes and functions. It also moved many classrooms from downtown to Waterfront Plaza, a commercial center popularly called Restaurant Row.

By 2018, HPU’s operating expenses exceeded revenue by $10.9 million, according to a financial statement filed with its tax return.

The pandemic might have been another blow. Instead, HPU has accelerated a comeback that started tentatively in 2019. In the past two years, the university has significantly increased enrollment. It has new medical programs in the works. And now HPU is financially back in the black.

HPU even gave faculty cost of living raises and bonuses last year, said Jennifer Walsh, HPU’s senior vice president and provost. The university’s $139,000 in positive operating income for 2021 might be modest, but HPU’s senior vice president and chief financial officer, Dave Kostecki notes, “This marks the first time that we have achieved greater than break even in a number of years.”

It’s a positive turn for an institution that plays a key role training residents for jobs in areas like nursing, an occupation perennially in short supply.

“HPU has a great reputation for good, qualified graduates,” said Art Gladstone, chief strategy officer for Hawaii Pacific Health, Hawaii’s largest hospital operator, who also is a trustee for HPU. “They put out really good graduates.”

A big reason is a growing number of students. Between the fall of 2019 and fall 2021, total enrollment grew 12.6 %, to 3,575 full-time equivalent students in 2021 compared with 3,174 in 2019, Walsh said.

Perhaps more remarkable is the growing number of incoming freshmen: in the fall of 2021, the university increased freshmen enrollment 56%, to 790, following an increase to 550 from 520 the previous fall.

And HPU is taking steps to grow more. The university is putting together a master’s degree program for physician assistants and a doctoral program for occupation therapists projected to launch in 2024, Walsh said.

In the shorter term, starting in July, the first cohort of students will arrive in Hawaii to start a new doctoral program in physical therapy.

The 110 students will pay $107,000 in tuition over two years to earn a doctorate via what HPU calls an accelerated hybrid program in which students visit campus every eight weeks a year but do most of the work remotely. It’s hardly cheap to run: HPU is hiring 50 adjunct professors and 15 full-time faculty and staff, including accomplished physical therapists who, says Walsh, “could make a good salary remaining in private practice.”

But with 150 students paying six figures, the program will provide substantial revenue for HPU.

“The return on investment is still very strong for this program,” she said. “We expect this program to be viable for many years to come.”

An important part of HPU’s future growth and expand the scope of their mission includes a partnership with Evidence In Motion (EIM), a leading provider of health care education solutions. All three new graduate health programs are powered by EIM as part of an OPM-style relationship.

Original article written by Stewart Yerton. To continue reading the original article, click here.