OHIO GAMMA GAZETTE THE CHAPTER HOUSE REFINANCE SECURED

Thank You Donors

Iam happy to report that we have successfully completed the refinance project for the chapter house and have transitioned from owner financing to traditional bank financing. Our mortgage was secured with OUCU Financial (previously the Ohio University Credit Union) under terms that will make our monthly cost structure less than 10 percent greater than it was under our favorable owner financing model. We did this in a rising interest rate environment with a rate locked in for five years. Future rate increases are capped, and the new amortization (thirty years vs. our old forty years) will allow us to build significant equity over the next five years. Refinancing is also available without penalty once interest rates are better.

The key to taking this over the goal line was threefold. First, we changed our rent and fee structure with the chapter, allowing for reasonable increases in line with the university and off-campus housing market resulting in being more than competitive with our new fees. Secondly, we raised nearly $75,000 through a small group of our most generous donors over the four years of this project. We cannot thank them enough. And finally, we achieved a $75,000 concession from the previous owner/note holder, who was motivated to close this deal and settle into retirement.

While we may have had a small group of large donors that stepped up to complete this project, you will see from the list in this newsletter that we had many brothers who made a difference by contributing in many ways. We raised funds over the first three years to meet contractual payments. These large and small donations included significant increases in our monthly donor program administered through Square®. Based on how the deal came together in the end, I can assure you that every dollar counted and was needed—thank you all. You indeed showed your commitment to our legacy through your generosity.

Now that the major down-payment type financing is behind us, it is time to move into the next phase. While we focused our fundraising and financial resources on getting bank financing, we were forced to be limited on what we could invest in the maintenance and upgrades to the house—we no longer have such constraints. With a monthly cost structure fully supported by member/tenant rents and fees, we want to invest alumni donations in the property to make it more appealing for members, alumni, parents, and guests. You can see Scott Long’s letter in this newsletter for a list of early projects we would like to tackle.

As part of the last fundraising, one generous brother has graciously seeded $5,000 to start a capital and maintenance fund. We are now looking for a broad base of alumni to add to that in whatever denominations they can. No donation is too small, and all monies raised from alumni will go into this fund. This includes our recurring monthly donor program, where many pledge their bond number. Brother Howard Gorrell 1408 started this program nearly six years ago, and it has become a nice bit of cash flow to aid in the repairs and maintenance that come with an older property.

Thank you all once again. Leading the financial piece of this project has been challenging, but the current rewards we are seeing have made it all worthwhile. I hope to see many of you at this year’s Founders Day.

Yours in the Bond,

Brian Bastock 1657 House Corporation Treasurer Bbastock33@gmail.com 440.212.3153