(Bloomberg) — Riverside Military Academy, an all-boys boarding and day school in Gainesville, Georgia, has entered into a forbearance agreement after defaulting on its debt obligations, according to a market disclosure.<\/p>\n
The military prep school for grades 6-12 students disclosed the agreement on Friday, just days after it announced new leadership and a \u201cmulti-year transformation\u201d to focus on improving academics and enrollment.<\/p>\n
The reprieve will last until Aug. 31, 2027, and the school will use a junior $8 million loan to provide bondholders with missed payments that started in March 2025, the disclosure shows.<\/p>\n
Representatives from the school did not immediately respond to requests for comment.<\/p>\n
The nearly 120-year-old academy defaulted on its debt obligations after missing a March 2025 payment, according to Fitch Ratings, which withdrew its rating on the school\u2019s roughly $48 million in municipal bonds issued in 2017.<\/p>\n
The school saw enrollment plummet almost 65% after the pandemic, from 509 students in 2019 to 180 in 2024. Enrollment averages 205 students, according to the school\u2019s website.<\/p>\n
Schools across the country have been struggling with enrollment declines as the number of school-aged children shrinks, largely due to a drop in the nation\u2019s birth rate. A smaller pool of students means competition is rising between schools \u2014 particularly at private institutions that charge lofty tuition \u2014 and it\u2019s fueling a spate of borrowing to upgrade facilities.\u00a0<\/p>\n
So far this year, private schools \u2014 which can tap the muni market because they are non-profits \u2014 have borrowed about $467 million in the market, just $11 million shy of 2025\u2019s total volume of $478 million, data compiled by Bloomberg shows.\u00a0<\/p>\n
Riverside charges its \u201cU.S. boarding cadets\u201d $61,200 in tuition and almost $71,000 for \u201cinternational cadets,\u201d while fees for the day attendance are just under $21,000. The school notes that almost 70% of its families receive financial aid and the average award is more than $11,000.\u00a0<\/p>\n
Founded in 1907, the school calls itself \u201cone of the few remaining institutions of its kind\u201d in the U.S. Its programs prepare students to apply to US service academies, which provide free undergraduate education in exchange for active-duty military service.\u00a0<\/p>\n
As part of Riverside\u2019s new strategy, which will be led by alumnus Nizar Zakka alongside a \u201cgroup of mission-aligned investors,\u201d the school will look to renew investment in academics, faculty and campus life, and also explore opportunities to license its name and model to international partners, according to a press release earlier this month.\u00a0<\/p>\n
More stories like this are available on bloomberg.com<\/p>\n
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