Seven years ago, High Point University was a small locally-focused Methodist college without a nationwide reputation, but since being taken over by Nido Qubein, a multimillionaire and motivational speaker, the sleepy campus has been transformed. After a $700 million infusion, the campus has been completely overhauled. In addition to statues of Aristotle, Galileo and Thomas Jefferson that dot the pedestrian walkways, new buildings like the Plato S. Wilson School of Commerce, which opened in 2009, boast the latest amenities, cutting-edge technology and ample classroom space. The Wilson building also sports a full-scale recreation of a financial trading floor.

Around the U.S. the students have taken notice. The school has increased its enrollment by nearly 50% and the tuition and fees have similarly gone up. Now that High Point can afford to be more choosy about the student body, the average SAT score of the incoming freshman class is 10% higher than it was before Qubein.

“The world is marveling at how High Point University has grown so successfully in the midst of the worst economic times in 54 years,” Qubein says.

Since becoming president in January 2005, he’s raised about $159 million in gifts and pledges, and has promised to kick in $11 million of his own money. There’s more to come: new dorms, a health-sciences school, a college of pharmacy, a sports arena—all told, a planned $2.1 billion in improvements by 2020. All this in the middle of a depressed North Carolina mill town.

Head of the Moody’s Investors Service’s higher education ratings group John Nelson talks about High Point using terms usually reserved for unusually aggressive and ambitious private sector companies. To fund the renovation, the school recently increased its debt burden to nearly $165 million, which makes it one of the most leveraged schools in America. Moody’s recently downgraded its bonds to junk status.

“The rate at which they borrowed and the aggressiveness of investment in facilities and marketing of the campus,” Nelson says, all set High Point apart.

High Point isn’t just selling itself. In a way, it is acting as a leaving and breathing advertisement for Qubein, the man who has transformed it. It is no wonder that Jordan-born Qubein who came to America as a teenager in 1966 without money, contacts or any real plans, considers himself an embodiment of the American dream. The luxury of his surrounding trumpet not only his success but serve as a reminder and a motivator to students of what they too can achieve with hard work.

Still, the cracks are already showing in Qubein’s grand experiment. In addition to the alarming level of debt, the schools academic indicators have slipped since 1995 and it is also falling behind on the traditional metrics such as the percentage of the faculty with a PhD which is down from 72% to 69% and the student-to-faculty ratio which went from 15-1 in 2005 to 16-1 today. Even the vaunted SAT score increase can most likely be attributed to the decreased racial diversity on campus and to an increase in the students’ average income. It’ll be a challenge to convince perspective students to see the value of High Point beyond that…

…of a school with OK academics, packaged in a dazzling campus with pricey extras and clean-cut rich kids.