...S&P Global Ratings lowered its rating on the Virginia College Building Authority's revenue bonds, issued for Regent University to '##+' from '###-'. The outlook is negative. The lower rating reflects declines in liquidity and endowment coupled with increasing operating deficits, which management had hoped to control with enrollment and revenue growth. However, because of weaker-than-projected enrollment for fall 2015 (while strong enrollment gains were achieved, it was below the aggressive budgeted level needed to improve operations), increased spending on marketing initiatives ($6 million more in fiscal 2015 than 2014) and continued losses at The Founders Inn and Conference Center, the consolidated operating deficit continues to grow. In addition, Regent still maintains an aggressive endowment spending rate to balance operations and provide funding for strategic needs, which could put further stress on liquidity. Future rating actions will hinge on management's ability to sustain the recent...
