Agassi school fund makes first investment in Las Vegas

The school campus at 9625 W. Saddle Ave. just got sent back a few grades.

Thanks to a funding assist from tennis great and native Las Vegan Andre Agassi, the vacant, former University of Phoenix site has been remodeled as Doral Academy West. The arts-centered K-8 charter school is the first local investment for the Canyon-Agassi Charter School Facilities Fund, a nationwide effort to move charters from stopgap buildings into permanent campuses.

Doral, which opened in August, will celebrate its launch with a visit today from Agassi and Gov. Brian Sandoval. And its debut marks the beginning of a new push by Agassi to build charter schools in Southern Nevada.

“My belief is that (charter school) operators will want to do many more schools,” he said. “Frankly, we’re way overcrowded here, especially in K-8. Creating more seats is crucial.”

The Canyon-Agassi fund will help create those seats by serving as a real estate investment fund. Charters operate independently of school districts and are not guaranteed classroom space or building funds. Many charters rent space in former warehouses or business complexes. Canyon-Agassi renovates or builds facilities the schools lease to own.

Doral Academy West is different because it started in its new building, rather than operating in a temporary facility. Its opening is a homecoming of sorts for Agassi. He built his first charter school, the $40-million Andre Agassi College Preparatory Academy, in West Las Vegas in 2001. But when he helped start up the Canyon-Agassi fund in 2011, he told the Review-Journal that Nevada’s below-average per-pupil spending, pricey commercial land and education-financing laws might keep him from building more charters here.

Things are different today. The cost of commercial property has fallen dramatically, and building vacancies are still well above normal levels. And in 2013, the Nevada Legislature opened charter access to state bond funds, which carry substantially lower interest rates than traditional bank loans, said Agassi Foundation spokesman Francisco Aguilar.

The changed market means Canyon-Agassi could bring “hundreds of millions of dollars in infrastructure to our community for best-in-class charter school operators that will be able to educate our children better than the public schools,” Agassi said.

Depending on project size, the investments could finance six to 30 local charters, Agassi said.

“I’m really proud to bring (the fund) here. I’m proud of Gov. Sandoval for being really instrumental in creating the bridge-to-ownership equity these operators can now access, and I’m thrilled to be raising real estate values around here,” Agassi said. “You build a school in an area that otherwise would have nothing, and now you’ve got 900 kids there, and ideally 1,800 parents coming every day. All of a sudden, that starts making businesses in the area a lot more attractive. It has multiple implications. For me to do this in my own backyard, I’m very proud.”

For Doral, the Canyon-Agassi fund allowed the “impossible” — a startup in a state-of-the-art, 56,000-square-foot college campus, said Principal Bridget Bilbray-Phillips.

“It lets us to come into the education system with some equal footing,” Bilbray-Phillips said. “One of the biggest challenges for charter schools is that their funding has to support the bricks and mortar, whereas the Clark County School District gets bond funding to support buildings. Canyon-Agassi freed up additional funding to utilize for our curriculum and materials and to get support directly into the hands of our teachers.”

The new building also supports the school’s academic mission, which involves incorporating arts into the curriculum. Elementary students research historical figures and reenact important events, complete with costumes and scenery. Middle-school students create original choreography, music or scripts based on what they learn in English class.

“Charter schools with an arts-integration focus are some of the highest-achieving in the country,” Bilbray-Phillips said. “Children are engaged, using different modalities to learn, and we see those successes in academic achievement throughout the country.”

With its new building, Doral’s mission is more secure. It cost about $9 million to build out the site, said Ryan Reeves, director of operations for educational management company Academica Nevada, which helped connect Doral Board Chairwoman Joani Williams with the Canyon-Agassi fund. The school is leasing the building from Canyon-Agassi, with an option to buy it in three years for $9.9 million — a 10-percent return for the investors.

“If we are stable, we can issue bonds and buy the building ourselves,” Reeves said. “The 10-percent return at buyback is unheard of for real estate development. Investors usually seek more from an entity that is brand new.”

Agassi and Bobby Turner, former chairman and CEO of Canyon Capital Realty Advisors in Los Angeles, launched the Canyon-Agassi fund with investors that included Citigroup, Intel Capital and Kansas City-based entrepreneurship think tank Ewing Marion Kauffman Foundation.

The fund started with $550 million in investments and loans to finance new buildings or to retrofit spaces for 40,000 students nationwide by September 2015 About 65 percent of the fund has been spent, helping complete 29 schools in Arizona, California, Texas, Florida, New York, Wisconsin, Michigan and Indiana. Its second local project, Somerset Academy of Las Vegas, is scheduled to open in August on Losee Road with 1,150 students. A third project, Doral’s Cactus Campus in Mountain’s Edge, also is on track for a fall opening.

For Agassi, there’s just one big problem: waiting lists. Doral Academy West has 900 students hoping for a seat. One Canyon-Agassi-funded charter school in Florida has 20,000 kids on its waiting list, he said.

So sometime in the spring, Canyon-Agassi will offer its second round of funding, this time roughly $750 million. It shouldn’t take more than a few months to raise capital now that the concept is proven, Agassi said.

“We’re going to have to turn people away. We have a track record that shows a return, and that shows a win-win across the board,” he said. “(Former International Game Technology Chairman and Canyon-Agassi investor) Charles Mathewson said to me, ‘Andre, it was like I’d just had one of the best meals of my life, and the chef told me afterward that it happened to be good for me as well.’ ”

Contact reporter Jennifer Robison at jrobison@reviewjournal.com. Follow @J_Robison1 on Twitter.