Southwestern Seminary Says Land Deal Erased its Short-Term Debt

School has been in financial and enrollment freefall for past few years

A big real estate deal has erased $4.2 million in short-term debt held by Southwestern Baptist Theological Seminary, President David Dockery told the Dallas Morning News.

Aerial view of Southwestern Seminary campus in Fort Worth, Texas.

The Fort Worth, Texas-based school, one of six seminaries owned by the Southern Baptist Convention, had been in a financial and enrollment freefall as recently as two years ago, leading to the forced resignation of former President Adam Greenway. He had succeeded President Paige Patterson, who was fired by trustees over mishandling sexual abuse allegations and allegedly mismanaging funds.

Under Patterson’s leadership, Southwestern Seminary’s FTE enrollment dropped 53% — the greatest shrinkage of enrollment in SBC seminary history. Things got worse under Greenway’s leadership, causing enrollment to drop to the lowest level since World War II.

Even as enrollment slid year after year, Patterson went on a building spree and faculty hiring binge that could not be funded in the long-term.

In 2022, trustees reported the seminary had accumulated a $140.1-million operating deficit from 2002 to 2022.

In 2023, the seminary filed a report with the Association of Theological Schools that noted a $15-million loss in net assets for the most recently reported fiscal year. The same report showed total net revenue dropping from $71 million to $33 million. Some of that loss was reportedly due to stock market performance.

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Exactly how the cumulative deficit was handled never has been made clear by administrators or trustees. However, Dockery told the Morning News the short-term deficit the school faced was completely erased by the sale of an aging student housing complex that brought in $14.225 million.

That complex, known as Carroll Park apartments, consists of 20 acres located a few blocks away from the main seminary campus. The largest part of the parcel was bought by a government-nonprofit coalition that will use the old military-style duplexes and triplexes as permanent housing for the homeless and for families fleeing domestic violence.

The real estate deal — which could be the first of several — not only wiped out the short-term debt but reduced long-term debt from $15.8 million in 2022 to $14.2 million in 2024, Dockery told the Morning News.

Part of the proceeds were used to increase cash reserves from $1.7 million in 2022 to $12 million in 2024, according to a trustee report.

Dockery said the seminary also reduced its payroll by cutting staff and has managed to begin increasing student enrollment.

“It has been a team effort from everyone across the board — staff, faculty and board members — who have worked together to prioritize institutional stewardship and to determine to live within our means going forward,” he told the Morning News.

The seminary also owns up to 60 acres of additional property that is currently undeveloped and theoretically could be sold. This is mainly located on the back side of the campus where the seminary for years acquired older homes and eventually leveled multiple blocks that still stand empty.

This article was originally published by Baptist News Global. It is reprinted with permission.

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