(Bloomberg) -- The University of the Arts, a private college in Philadelphia that abruptly closed its doors in June, filed bankruptcy Friday, two weeks after it faced a demand by its bondholders for immediate repayment of more than $50 million in debt.
The school listed assets and liabilities of $50 million to $100 million, in a petition for Chapter 7 liquidation filed in the US Bankruptcy Court in Delaware. The school’s board of trustees held a special meeting on Sept. 5 to approve the filing. It was subsequently approved by 17 of 18 board members.
The closing of the school came as a shock to students, parents and staff who were only given a week’s notice. The action spurred protests at its campus as well as multiple legal actions.
Former faculty members filed suit against the institution in June saying it violated federal and state employment laws for failing to give enough notice of a mass layoff. A class action suit was also filed by students on similar grounds.
Many small, private schools are struggling to stay competitive in a landscape with fewer students going to college. At least 23 institutions have closed or merged so far this year, according to data compiled by BestColleges.
University of the Arts had a student-faculty ratio of 7.5 to 1 and offered degrees such as a master of music and master of fine arts, according to its website.
Enrollment dropped precipitously ahead of the closing, with the number of full-time students falling to about 1,100 in the 2023-24 school year compared to 1,800 in the 2019-20 year, according to a regulatory filing.
University of the Arts has hired restructuring firm Alvarez & Marsal as a adviser. Richard Placey, the university’s bankruptcy attorney, didn’t immediately respond to an emailed request for comment.
Gordon Gendler, a senior vice president of UMB Bank, the trustee didn’t immediately return a call seeking comment.
--With assistance from Jonathan Randles.
(Updates with more information about the bankruptcy filing and closure.)
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