SUBJECT: Alpha Phi Lease Modification
Alpha Phi organization is borrowing funds from a local bank for some building improvements. The existing lease agreement, made in 1923, prohibits the organization from encumbering the leasehold estate. This provision makes it very difficult to secure financing given current banking regulations. The proposed improvements are desirable and the organization should be commended for moving forward with this project.
In order for the loan to be finalized, the lease must be revised to permit the organization to borrow money and encumber the property improvements. Attached is a draft lease agreement prepared by University Counsel which, if approved, would extend the current lease period to 2029 and permit the Lessee to encumber its leasehold estate.
President Farley recommends Board approve the new proposed ground lease with the Upsilon Chapter Alpha Phi Corporation permitting it to encumber its leasehold estate for securing financing to make improvements to its property.
(date) Jerry B. Farley, President