A meeting of the Executive Committee of the Purdue University Board of Trustees convened at 10:00 a.m. on Monday, July 11, 2022, in Stewart Center, Room 326, on the Purdue University campus in West Lafayette, Indiana.
Committee members present in person or by means of electronic communication pursuant to the Electronic Meeting Policy were: Michael Berghoff, chair (conference call); Gary Lehman, vice chair; JoAnn Brouillette; and Sonny Beck (conference call); Vanessa Castagna was not in attendance.
Officers and administrators in attendance were: Steve Schultz, general counsel; Cindy Ream, corporate secretary and senior executive assistant to the Board; Michael Cline, senior vice president for administrative operations; Chris Ruhl, chief financial officer and treasurer; and Nicole Michienzi, Senior Director, Capital Markets.
Pursuant to Article V, Section 1, of the Bylaws, during intervals between meetings of the Board, and subject to such limitations as may be required by law or specifically imposed by action of the Board, the Executive Committee has the authority to exercise all powers of the Board.
I. CALL TO ORDER
Chairman Berghoff conducted roll call and confirmed a quorum of the Committee was present.
II. APPROVAL OF RESOLUTION FOR ACQUISITION OF ASPIRE PROPERTY AND RELATED ACTIONS
Chairman Berghoff introduced the meeting’s sole agenda topic with a reminder that it had been previously discussed at the Board of Trustees meeting in June—on that occasion as a request for Purdue Research Foundation’s assistance in acquiring Aspire at Discovery Park from Balfour-Beatty, which had put the property out for bid. He further stated that the purpose of this meeting is to consider adopting a resolution approving the follow-on acquisition of the Aspire Property from the Foundation and authorizing the financing of the purchase. Chairman Berghoff then asked Mr. Ruhl to provide the committee with a summary of the proposed transaction.
Mr. Ruhl noted, regarding the point made by Chairman Berghoff, that the prior action in June had merely authorized taking a first step toward eventual Purdue ownership of the Aspire property. He explained this acquisition will require state approvals, but given the timing of public agency meeting calendars over the summer, it was necessary to request the Foundation’s assistance with the interim purchase to enable a timely close and transition of operations from the seller based on its timetable. Based on that request, PRF moved forward a submission to Balfour-Beatty, and its bid was accepted. Now, the purpose of this meeting is to seek formal approval for the University’s purchase of the land and Aspire facility from PRF and authorization to secure financing for the acquisition.
Mr. Ruhl proceeded to explain that, as noted in the memo provided to the Committee in advance of the meeting, the property to be acquired includes 4.8 acres of land plus housing complex of approximately 387,000 square feet. He noted that the authority granted by the resolution would enable the Purdue team to commence the state approval process, which commences later in July with the Indiana Commission for Higher Education, followed by the State Budget Committee and State Budget Agency later this fall
Mr. Ruhl reminded the Committee of the reasons management continues to believe, as it had explained at the June board meeting, that Aspire is the best option to address the growth in the undergraduate student body and strong demand for University housing: (1) it provides the fastest solution, affording immediate owned housing stock capacity once Purdue Housing takes over Aspire operations in another month or so; (2) it provides the most flexible solution, with existing amenities and alternatives in terms of room typology mix and density; (3) it provides the most affordable solution, with the lowest per bed cost versus other alternatives like continued master leasing or building new construction in a volatile market; and (4) it provides a student-friendly location that is adjacent to current housing and dining facilities and a centerpiece of the Discovery Park District.
Mr. Ruhl indicated that Ms. Michienzi had been orchestrating the effort to explore financing options and develop the proposed plan of finance, and she is available to field questions. He proceeded to summarize the plan to fund the total $155 million purchase price with a combination of Housing/Dining reserves and tax-exempt debt issued either through a private placement or public market bond sale. Ms. Michienzi has been actively coordinating with the Foundation’s staff on the task of seeking interim financing, and following state approval, the University will seek to take out the interim Foundation with a more permanent University borrowing when market conditions are optimal. Mr. Ruhl and Ms. Michienzi then answered several follow-up questions from members of the Committee.
After further discussion, and upon proper motion duly made and seconded, the Executive Committee, acting on behalf of the full Board, voted unanimously to approve the Resolution for Acquisition of Aspire Property and Related Actions. A copy of that resolution and other supporting materials will be filed with the minutes.
III. ADJOURNMENT
By consent, the meeting adjourned at 10:20 a.m.