Tax-Exempt Bond Financing for Multi-phase Expansion
About the Client
For more than a century, a Lower East Side tenement apartment complex housed 10,000+ people, including working class immigrants working toward better futures for themselves and for generations of Americans to come. 103 Orchard Street presents an ordinary building but one that “re-imagines the role that museums can play in our lives,” to quote our client. Visiting the places where our ancestors once lived can result in a profound connection with the past.
- Property conversion/renovation
- $8.9M (visitor center)
- $10.7M (exhibition space)
- Tax-exempt Direct Purchase Financing
- Build NYC Resource Corporation
- NYCEDC (city capital grant)
- Complicated Long-term Financing Solutions
Complicated Long-term Financing Solutions
The Tenement Museum purchased and renovated a multi-story landmark building (c. 1888) on Orchard Street. The museum sought to expand, but over several years, necessitating financing for a mixed-use facility with residential, commercial, and retail usage.
ThinkForward funded multiple phases of the expansion, initially involving the visitor’s center and then a new exhibition space, with tax-exempt bonds placed directly with large commercial banks within our extensive lending network.
Economical Debt Structuring
The Tenement Museum had originally approached ThinkForward, requesting assistance with refinancing debt on its existing building. We procured that savings through reduced interest rates and a more economical structuring that helped finance new exhibit space.
A portion of the tax-exempt bond financing was structured as fixed rate bonds, at a ten-year rate of 3.05%, with the remainder structured as floating rate bonds, with a current rate of 1.73%. Proceeds were used to refinance an outstanding bond issue, as well as to provide funds for renovations and upgrades.
“Financing the Tenement Museum for long-term viability meant identifying cost-effective solutions. Our latest expansion and new exhibition ‘Under One Roof’ would not have been completed without ThinkForward.”Barry Roseman, Chief Financial Officer
We also introduced several more competitive investor options, including the alternative to maintain less in cash reserves, while also securing grant assistance from the NYC Economic Development Corporation.
“Soup to Nuts” Financial Advisory
As Financial Advisor, we managed the entire financing process: procurement through closing. Our efforts included finding the ideal lender, managing the issuer application process, and obtaining all necessary approvals. We also developed financial analyses to determine the optimal structure, prepared the tax analysis, and coordinated with all legal counsels.