School flees Katrina, finds haven in KC

kansas city business journal logoApril 17, 2006 – After surviving Hurricane Katrina, Grantham University is finding that the only wind now is at its back.

The online college, which relocated to the area from Slidell, La., in September, moved into a 37,000-sqaure-foot office at Zona Rosa last month and is talking with a local developer about building a 50,000- to 100,000-square-foot headquarters.

Grantham University has hired 150 local employees since arriving a week after the storm hit and could add 100 more this year, CEO Thomas M. Macon said.

Not only has the college survived Katrina, it is thriving. Pre-Katrina, it had 140 employees and 8,000 students; today, it has 190 employees and 9,500 students.

“That’s what you tip your hat to,” said Pete Fullerton, executive director of the Platte County Economic Development Council. “They’re still on the growth spurt they were before.”

When Grantham University officials cut a ribbon with Kansas City Mayor Kay Barnes to celebrate the Zona Rosa office on April 20, it will cap a tumultuous eight months.

Of its 140 Gulf Coast employees, 60 initially relocated to Kansas City in the weeks after the storm (40 have stayed). When it was clear that the Slidell headquarters had been destroyed, Macon made the move permanent, expediting plans hatched in early 2005 to open a Kansas City satellite office.

“Basically,” Macon said, “we stood this university up.”

Grantham University’s students, largely members of the U.S. military, pursue degrees in fields such as engineering management and criminal justice over the Internet. Founded as a brick-and-mortar college in 1951, Grantham is accredited by the Distance Education and Training Council.

Distance learning has been a hot industry, sparked by members of the military who receive a subsidized education. Park University, for example, will have 50,000 online enrollments this year, Vice President Thomas Peterman said.

“I would guess more than half of that is out of the military,” he said.

Peterman, who runs the online portion of the Parkville college, said he is not concerned about Grantham as a competitor. Both schools draw from a national base of students online.

To Grantham’s students, the hurricane’s displacement of the university was unseen. Computer servers that are used to power lessons online are housed in Arlington, Va., where parent company Grantham Education Corp. is based.

All of the university’s documents are digitized, part of a disaster recovery plan Macon put into place last year after witnessing Hurricane Ivan’s destruction in Pensacola, Fla., where he has a home.

“If this was a couple of years ago,” Macon said, “I don’t think we would have made it.”

Grantham University was initially drawn to Kansas City by several factors. Macon’s wife is the sister-in-law of Missouri Treasurer Sarah Steelman and a University of Missouri-Kansas City graduate; Macon is from the St. Louis area.

University officials also thought Kansas City had an attractive base of workers — little did they know they would have to hire 150 in six months.

“We’re very happy with the people,” Grantham University President Roy Winter said. “They have just a heads-down, get-the-work-done mentality.”

After the storm hit, Steelman coordinated with the Missouri Department of Higher Education to give the school a temporary certification so that it could relocate quickly. The state issued a formal certificate in February.

“We were in the final stages of their review process anyway,” said Leroy Wade, director of proprietary schools for the state. “We had a reasonable comfort level.”

To provide a soft landing to its employees from Louisiana whose lives had been turned upside down, Grantham University paid for the first six months of their Kansas City rents. It also paid for a move-in package that includes things such as new silverware.

“If they didn’t have my loyalty already, they would have had it immediately,” said Susan Medina, the university’s director of curriculum.

Macon declined to specify how much the company spent on the move but said it was “a couple million dollars.” The company had money saved away “for a rainy day,” he said.

The privately held, for-profit university does not disclose its revenue numbers. According to the Princeton Review, tuition is about $3,500 a semester.

Grantham University’s move to Kansas City is permanent now. There are too many uncertainties about the Gulf Coast and its livability, Macon said.

And as the business hires more people locally to design courses, recruit students and provide support, it will become an increasingly Kansas City company.

“The roots are Slidell,” Winter said. “But the trunk and tree are Missouri and Kansas people.”