Since 2003, Building Hope has provided over $200 million dollars in direct loans and credit enhancements to charter schools supporting more than one billion dollars in project costs. As with all our programs, the Facility Financing Program works with high quality public charter schools to ensure that they have their facility needs met.
Through our Facility Financing Program, Building Hope assists charter schools:
- Purchase land and build a new facility
- Renovate a leased or owned facility
- Guarantee a lease
Existing schools are evaluated based on their financial and academic results compared with other public schools serving similar populations. New schools are evaluated on their proposed curriculum. Regardless of whether the school is existing or new, schools are also evaluated on the experience and strength of their leaders and board, financing projections, enrollment plans, community support, and specific transaction details.
As a national, nonprofit organization, Building Hope is able to lend money and provide credit enhancements at below-market rates. This creates immediate savings to the school that can then be directed to support the school’s programs and result in higher academic outcomes.
Building Hope provides both senior and subordinated loans for a period of three to five years. Typically, we obtain a security interest in the property being financed or seek another type of collateral to secure the loan. Many of our transactions involve multiple lenders where Building Hope leverages financing sources by providing the last dollars needed to complete the project. Loans can be used to bridge longer-term financing options, grant funds or New Markets Tax Credit equity.
Building Hope provides lease and loan guarantees to facilities financing and leases for public charter schools nationwide. General terms include a guaranty period of three to five years and an annual reduction in the guaranty. Credit enhancements are supported in part by a grant from the U.S. Department of Education Charter School Program. Preference is given to new schools that have been operating less than three years and/or at least 50% of their students are eligible for free or reduced-price lunch.