Gentlemen:
We have now $961,000 in pledges and contributions to our A Reason to Be Proud capital campaign. Thank you to our brothers who have shown their support. I wanted to let you know that the national credit crunch that you have read about is impacting our project. At our last leadership meeting, Steve Courter reported last week that it looks like the banks, due to the national credit crunch and related issues, will only lend us about $500,000 or so, which is less than half of what we need for our planned project.
To meet our construction schedule, we need to sign contracts by mid-January '08 before construction can begin by the end of January and be completed by August '08.
How are the banks coming up with $ 500,000?
They subtract from our $950,000 (to use a round number) $150,000 that we have already spent on architectural and marketing expenses, or will spend by the time construction starts; then subtract another $200,000 for interest expenses (interest owed during the term of the loan) and another $100,000 for estimated unpaid donations (they assume 10 % of pledges won't come in).
They don't want to foreclose and own the house, so we are not getting any credit for the value of the house. The bids are out, prospective bidders have inspected the house and their bids are due early Jan.
Steve Courter is aggressively shopping our financial package around amongst interested banks (there are about 5 or 6 in play).The Actives will be living in Alpha Kappa Lambda for the spring semester.
On the bright side, it is not as if we only raised $500,000 total for the project. We are at the high end at $961,000 of our original estimated range for pledges (750- 1 million), but that money is paid in over 5 years. We have to pay our contractors in 2008, when the work is done. They of course won't wait 5 years to get paid.
With that said, we are poised to move forward, but we need the financing in place.
Urgent action -- What do we do now?
We need to increase our pledge level in the next several weeks to have a better financial showing for the banks, and also seek donors who may want to provide a no interest or low interest loan.
If you have not pledged yet, please do so at your earliest opportunity for this very worthy cause.
Also, PLEASE LET US KNOW OF 5-10 ALUMS WHO HAVE NOT PLEDGED YET, and WHO YOU THINK HAVE THE CAPACITY AND INTEREST TO HELP US.
The latest pledge report will be posted on the Kappa Chapter web site.
Ed Kraus will contact the top 40-50 alums we identify to have a targeted effort the next few weeks. We will contact you if any of the people we speak with want to speak with you.
Steve Brose and Dick Richardson have re-issued their Challenge Grant for the '67-'71 classes. Thanks Steve and Dick!
We reached $956,000 through YOUR efforts. I know this project has taken much more time than any of us anticipated. But we are on the verge of reaching our goals. The credit crunch is an unfortunate development, however, not an insurmountable roadblock to our success. We have the financial support to pull this project off, but we have a timing problem that we have to solve.
Our project volunteers span FIVE DECADES of Kappa Chapter alums. It has been great to renew friendships with people I knew in the house and great to work with many of you who I had never met before.
We all share the same objective of renovating the Chapter house and revitalizing Kappa Chapter.
THANK YOU FOR ALL YOUR HELP!
WISHING YOU AND YOUR FAMILY THE VERY BEST, FOR VERY HAPPY HOLIDAYS!!
Fraternally,
Bill DeGrandis , '77
Chairman, Reason to be Proud Campaign and Vice President, Alumni Board of Directors
