The Dormitory Authority of the State of New York issued $100 million in bonds to finance campus improvements at the New York Institute of Technology (NYIT).
The bonds mature between 2027 and 2054, yielding between 2.86% and 4.24%. They received a rating of Baa2 from Moody’s Investors Service and BBB from S&P Global Ratings.
The authority will loan the bond proceeds to NYIT, a private research university with campuses in Long Island and Manhattan.
The rating incorporates the university’s “good enrollment diversification, consistently positive operating margins, and relatively large operating scale,” Moody’s analysts wrote.
The issuance is aimed at supporting NYIT’s ambition to become a nationally renowned research university within the next five years. The bond proceeds will fund the major renovation of a former classroom building to create a new, 20,000-square foot biomedical research center at its Long Island campus. NYIT expects the center to open in the first quarter of 2025 and boost research activity soon thereafter. “The state-of-the-art facility is anticipated to expand the institution’s research footprint and further its strategy to become a Carnegie-classified Research 2 university by 2028,” the school’s website reads.
The Carnegie Classification system was designed in 1970 to identify groups of comparable institutions, according to the nonprofit American Council on Education, which runs the classification system. Doctorate-granting universities such as NYIT are divided into three tiers, with R2 representing schools that have “high research activity.” (R1 schools have “very high research activity.”)
The issuance will also support other renovations, including to its infrastructure, classroom, and athletic facilities.
The state dormitory authority finances low-interest rate bonds on behalf of many of New York’s private universities. The bonds are special limited obligations of the authority and general obligations of the institute, secured by its revenue.
Morgan Stanley & Co LLC served as underwriter on the issuance, purchasing the bonds for more than $109 million.