Yeshiva University has taken out a $175 million loan to refinance five of its Manhattan buildings, The Commercial Observer has reported.
Yeshiva University has been going through financial difficulties for a while now due to losses estimated at as much as $105 million that it suffered at the hands of one of its board trustee, a gentleman named Bernard Madoff. Moody’s has downgraded its investment rating five times in the last three years.
Back in January, after one of those downgrading episodes, Emily Schwarz, an analyst at Moody’s in New York, told Bloomebrg the reason for YU’s continued ailment was “their management. I don’t see the market being the main concern. They really have a real niche. They are the Jewish university of New York.”
Well, there’s NYU, too…
Madoff, a big supporter of Jewish causes, joined Yeshiva’s board of trustees in 1996 and was treasurer at the time he resigned in 2008. Hec was also chairman of the business school.
That’s almost too much comic material…
Yeshiva invested in Madoff through Ascot Partners LP, owned by another university board member, Ezra Merkin.
And in the spirit of closing the barn doors after the horses have all been tried for embezzlement, in 2009 YU approved a conflict-of-interest measure to stop doing business with board members.
While the University has been trying to deny that is suffering financially, the facts speak for themselves. In May it sold off ten residential buildings that it had owned in Manhattan to Ruby Schron.
The loan was extended by the Kansas City Missouri based UMB Bank. The new 10 year debt replaces previous loans that were coming due. A spokesperson for the university told the Observer that the money, “raised additional liquidity and runway to support university initiatives in the coming years. As part of this financing, the university pledged several of its core assets located on the Wilf and Beren campuses as collateral, without affecting its core academic missions. The university continues to own an expansive and valuable real estate portfolio across three Manhattan campuses.”
The refinanced buildings include 215, 245 and 253 Lexington Avenue located in Murray Hill near 34th Street. 215 Lexington is actually two attached properties located between 32nd and 33rd Streets which the school acquired in 1988. The three buildings are all part of Yeshiva’s women’s’ school Stern Colleges midtown Manhattan campus.
253 Lexington Avenue is also known as the Packard Commercial School Building, named for Silas Sadler Packard who established a school in the 19th Century. Built in 1911, the 56 foot high building has five stories with three arches on the front of the ground level and four ornate columns if front of its three middle floors.
245 Lexington is known as the university’s Beren Campus which houses the women’s division of its Sy Syms School of Business.
The other two buildings refinanced are 2495 and 2520 Amsterdam Avenue, located at the University’s main campus in Washington Heights. 2520 Amsterdam Ave is an ugly brown six story apartment building built in 1967. 2495 Amsterdam Avenue is the University’s main campus building.
Moody has blamed the university’s failures on its inability to control operating costs, particularly at the Albert Einstein College of Medicine, as well as delays in deploying a system-wide accounting network which is “common at other nonprofits, ” according to Moody.