Another $863 Million Toward NYU’s Expansion
NYU has faced criticism in the past for seeking to expand its boundaries through initiatives like the 2031 expansion plan — bonds recently received from a state agency will be used to continue these efforts.
March 12, 2019
NYU, like other universities, is constantly expanding. Unlike other universities, it recently borrowed almost $863 million in bonds through the Dormitory Authority of the State of New York, according to the DASNY.
The university intends to use these bonds to finance renovations and construction projects at various NYU locations. Tax-exempt bonds make up $603.5 of the total $862.8 million. These bonds will go toward financing construction projects such as 181 Mercer St., 370 Jay St. and the Langone Health Science Building.
NYU has borrowed more than other New York universities such as Columbia University and the State University of New York. According to a DASNY press release, Columbia borrowed $325 million while SUNY received approximately $31 million last year.
The university’s expansion efforts have faced consistent backlash from some students, faculty and local community members. In 2017, locals opposed NYU’s Mercer Street expansion due to concerns about the effect it might have on natural light and air quality in the area. Prior to that, NYU was criticized after the release of its 2031 expansion plan, which would expand its physical plant by 40 percent, according to The New York Times. Greenwich Village residents were angered by the potential reduction in public land that could instead be used for playgrounds, dog parks and other communal spaces.
Out of the new funding NYU received, $83 million was financed through Green Bonds, which are tax-exempt bonds with lower borrowing costs meant to fund environmentally sustainable projects. These types of bonds allow for reduced expenditures and give investors the ability to directly support NYU’s sustainability initiatives.
NYU’s Co-Generation Power Plant produces a significant amount of energy for the university. NYU will use the Green Bonds to connect the plant with a retention tank to manage rainwater runoff in hopes of increasing efficiency. In addition, energy efficient windows will be added to 370 Jay St., and the Langone Health Science Building will have glass added to its facade and incorporate a lighter-colored roof in the hope of reducing heat radiation.
Last year, DASNY issued the university $593 million in bonds for the construction of a new NYU School of Medicine science center, improvements to academic facilities on the Brooklyn Campus and the construction of the mixed-use building at 181 Mercer St. According to the press release, the additional bonds will be used with previous DASNY bonds to further finance these ongoing construction projects.
Unlike grants, the bonds are fixed-income investments given to investors and are meant to provide the university with a low-cost means of funding their projects, according to DASNY Director of Communications Deborah Fasser.
“The issuance of bonds through DASNY provides NYU with low cost, long-term financing to support ongoing capital expenditures,” Fasser said. “The 2019 bonds will be repaid over a 30-year period.”
In a statement to WSN, University Treasurer Janine Wilcox said that the construction and renovations financed by these bonds help further the university’s commitment to reach carbon neutrality by 2040. The bonds also allow the university to work towards sustainable construction practices and infrastructure improvements that will reduce the university’s energy consumption while borrowing on a tax-exempt basis.
“In general, all of NYU’s construction efforts endeavor to follow sustainable building practices,” Wilcox wrote. “It is our goal that all future new buildings achieve LEED Certification at the Silver level or above.”
Email Marie-Louise Onga Nana at [email protected]