Our model creates 100% financing to build new, or modernize existing assets by funding the institution with sufficient unrestricted capital by monetizing individual assets without using blanket collateralization, required by traditional funding institutions . Using a hybrid sale/leaseback/donation model which utilizes a Master Lease Agreement, Campus Capital is able to offer tax-exempt or taxable funding structures to fund the institution's renovation or expansion initiatives.  We also utilize an Operating Agreement which allows the asset’s title to be totally donated within the first few years of the lease term, without the University using upfront capital investment and allowing current operation and management to remain unchanged. Our model affords all of the benefits of ownership and allows us to finance through existing debt restrictive covenants, listed in the Master Bond Indenture. We simply use the asset as a funding vehicle before donating the title back to the institution by year six.

 

For example, Campus Capital purchases a university facility valued at $30,000,000, utilizing a 30-year Master Lease and an Operating Agreement which incorporates a 50% asset donation factor in year one and 10% in years two through six, at which time the asset is donated entirely, in fee simple. The asset donation factor would have a first-year valuation of $15,000,000 and $3,000,000 annually until fully donated by year six, producing an increasing asset on the balance sheet and retaining all of the benefits of ownership for the university. Existing depreciated assets can be turned into unrestricted capital within 90 days of document execution.