Monday, July 12, 2004
Lincoln
Completes Sale of $40.1 Million in Revenue Bonds to Finance Construction
of 400-Bed Residence Hall and Refinance Graduate Center
Moody's Investors Service has assigned Lincoln its first ever
"A3 underlying rating" to the sale of the bonds, calling
the University's financial outlook stable and acknowledging Lincoln's
"distinctive market position" in higher education.
Lincoln
University, PA —Lincoln University, which is celebrating
its 150th anniversary as America's first Historically Black University,
has achieved a new milestone after completing the sale of $40.1
million in revenue bonds to finance two of the University's major
projects.
Lincoln's
revenue bond sale on June 10, 2004 financed the construction of
a 400-bed residence hall in two phases at the University's main
campus in southern Chester County, PA. In addition, the sale of
the revenue bonds has refinanced all existing loans including
the purchase of the University's Graduate Center at 3020 Market
Street, in Center City Philadelphia, as well as important refurbishments
on the main campus.
The A3 rating
is especially significant because many colleges and universities
are unable to qualify for an investment grade rating. Moreover,
Moody's rating is based on the company's thorough assessment of
Lincoln's financial performance, the leadership of University
President Ivory V. Nelson, Ph.D., and his management team, as
well as Lincoln's track record in achieving its educational and
financial goals.
"This
is an historic occasion for Lincoln University and underscores
the fact that as Lincoln celebrates its past and current accomplishments
and distinctions in higher education, Lincoln's best years of
achievements are still ahead," President Nelson said.
President
Nelson added: "The new residence hall fits into Lincoln's
strategic plan for expanding its student enrollment. Also, the
University has successfully refinanced its Center for Graduate
Studies and Continuing Education. This removes previous restrictions
on leasing space at the Center."
The bonds
were issued by the Pennsylvania Economic Development Financing
Authority and insured by the Financial Guaranty Insurance Company,
of New York, a bond insurer carrying "Aaa" and "AAA"
financial strength ratings by Moody's and Standard & Poor's
(S&P) Rating Services, respectively.
The construction
will cost an estimated $21.2 million. The repayment of the existing
loans costs $14.1 million. The rest of the funds will be used
for debt service reserve and other required funds, and the costs
of issuing the bonds. The University has refinanced approximately
$13.2 million in outstanding principal from two loans made by
the Educational Direct Loan Mortgage Corporation. The original
loans were used for various capital improvement projects on the
main campus, including renovations and maintenance to three dormitories
and an administrative building that houses the University's Department
for Public Safety.
The Series
2004 Revenue Bonds were issued in two parts: $30.2 million in
2004A Tax Exempt Revenue Bonds, and $9.9 million in 2004B Taxable
Revenue Bonds for the refinancing of loans for Lincoln's Graduate
Center. The six-story, 193,000 gross square feet building houses
Lincoln's six master's degree programs in administration, education,
human services, mathematics, reading, and school administration.
The building also provides continuing educational opportunities
for the Delaware Valley region and is utilized by a charter school
and other commercial tenants.
Lincoln's
400-bed dormitory will be built in two phases, each to consist
of 200 beds. The first phase completion is expected by August
2005. The second completion is expected by August 2006. Official
groundbreaking for the new residence hall will coincide with the
University's first meeting of the Board of Trustees of the 2004-05
academic year on September 18, 2004. The time of the groundbreaking
ceremony will be announced at a later date. Construction bids
were opened on June 9, 2004. However, construction of the road
has already started for the dormitory that will be located at
the rear of Lincoln's 350-acre main campus.
Founded in
1854, Lincoln University is nationally recognized today as a major
producer of African Americans with undergraduate degrees in the
physical sciences (biology, chemistry and physics); computer and
informational sciences; biological and life sciences. Lincoln
enrolled 2,000 undergraduate and graduate students for the 2003-2004
academic year. The University starts its 2004-2005 academic year
on August 25, 2004.
