A Yeshiva in Brooklyn, New York

Project Summary

A non-profit private school in Brooklyn required construction and permanent financing for expansion of its classroom and other facilities.


  • The School, as a 501©(3) would have qualified for the tax exempt bond financing, but legislative roadblocks that prevented the issuance of tax exempt bonds for not-for-profits forced the school to look beyond the capital markets for financing.
  • The project involved new construction to be partially funded by capital campaign pledges.
  • The School was denied financing by their own bank, and other large relationship banks were demanding personal guarantees from School Board Members in addition to campaign contributions, to facilitate financing.


  • We harnessed our vast lending network and arranged a traditional construction to permanent loan with a small community bank with the option to convert into tax-exempt bonds, subject to reauthorization of the aforementioned legislation.
  • To minimize conversion costs, we arranged the financing with a bank that would purchase the bonds upon conversion to bond financing, thereby eliminating the need to find a new investor and restart the funding process yet again.


  • Our financing structure did not require personal guarantees of the Board and was structured as a single loan for both the construction and permanent portions of the transaction.
  • The financing was accomplished on time thereby enabling the School to complete the construction on time and under budget.
  • Upon re-instatement of legislation authorizing the NYC IDA to issue tax-exempt bonds, the client has the option to refinance its taxable debt into tax-exempt bonds at a pre-set rate, 2% below the conventional rate.
  • The client will not need to secure a third party lender for refinancing as the current lender has the capacity to purchase the tax-exempt bonds after conversion.
  • We will continue to assist the client through the conversion process including preparation of applications and other requirements of tax-exempt IDA financing.