Substantial Savings Generated through Refinancing Existing Bond Debt
Guttmacher Institute Headquarters

Manhattan

Increasing liquidity by decreasing interest rates on $8.55M of debt was the primary financial driver behind the Institute’s decision to refinance. The NYCIDA bonds were originally issued in 2007 for leasehold improvements to the 125 Maiden Lane office condominium.

Additional objectives included simplifying the financing process and, ultimately, avoiding tedious annual bond compliance requirements. In 2020, securing significant operational savings was paramount, considering the pandemic’s impact on our client’s budget.

• $8.55M taxable mortgage loan
• 2.05% taxable fixed rate (15 years)
• 15-year amortization schedule

We were directed to increase cashflow, which meant thinkingholistically about how to leverage all potential resources and relationships.‍

1. We considered our client’s need for a straightforward, pared-down financing process, which meant expediting the approval and closing processes and keeping closing costs to a bare minimum.
2. We worked with a lender with no mortgage requirement, effectively avoiding sizable mortgage recording taxes by securing a negative pledge on the condominium.
3. We structured the refinancing to save the Institute $3M over 15 years primarily through reduced interest rates (from 5.75% to 2.05%)-rates fixed for the term of the loan.
4. Furthermore, our client avoided substantial compliance and reporting requirements associated with tax-exempt financing.

For a two-year period, ThinkForward monitored the markets for the Institute and analyzed financing opportunities until an optimal solution presented itself. The Institute’s choice to move forward with 100%debt financing (including closing costs) resulted in significant savings—above and beyond any tax-exempt alternatives.