Thursday, May 19, 2016

Treasurer plans to pay off University's extensive debt with property revenue - Avery Anapol, GW Hatchet

GW’s total debt has steadily increased over the past eight years, but Executive Vice President and Treasurer Lou Katz said capital projects that bring in revenue, like parking garages and new academic buildings, have matched the debt increase. Katz said that over the next five years, the University will begin to pay off outstanding debts without investing in as many capital projects. He said GW had not previously paid off these debts because the interest rates were low, and the University’s loans are fixed-rate – meaning that the interest does not fluctuate for the time they have the loan. The University paid off a $200 million bond in full using on-hand cash in July 2015, according to Katz. Katz said low interest rates will allow the University to extend the maturity of some debts that will come due in fiscal year 2019 from 10 to 30 years, which officials will have more time to pay off. “We try to ladder what our maturities are so all debts are not coming due at the same time,” Katz said. “We believe this is a very secure debt strategy.”

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