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Closure and sale to Iona College
On January 28, 2021, Concordia College New York (CCNY) announced that it would close at the end of the summer term and sell its Bronxville campus to Iona College, making it the third Concordia to close since 2019.
In a joint statement, Iona said it would use Concordia’s campus to develop its health sciences programs.[2, 3] Several months later, in July of 2021, Iona announced a $20 million gift from NewYork-Presbyterian Hospital to establish the NewYork-Presbyterian Iona School of Health Sciences on the former Concordia campus.
On October 4, 2021, CCNY submitted to the Westchester County Supreme Court a petition to sell its main campus to Iona for $30 million. According to the petition, most of the proceeds from the sale will go to paying off CCNY’s debt to the Lutheran Church–Extension Fund (LCEF), which exceeds $25 million.
The petition identified the LCEF as CCNY’s “only significant secured creditor”, saying its outstanding loans were “secured by first mortgage liens recorded in the Westchester County Clerk’s Office against the Petitioner’s Campus Real Estate.”
On October 20, 2021, two weeks after Concordia filed its petition to sell its campus to Iona, 27 former faculty and staff members filed an objection with the Court seeking to hold up the sale. They claimed the $30 million sale price was artificially low and asked the Court to schedule an evidentiary hearing to determine its fair market value. The Court is still considering their objection.
LCEF mortgage agreements
CCNY and the LCEF signed a series of mortgage agreements between 2006 and 2020. In each agreement, CCNY posted as collateral different combinations of its main campus properties at 171, 182, 187, and 193 White Plains Road in order to get financing from the LCEF.
CCNY continued to sign mortgage agreements with the LCEF in 2021, after the school announced it would close and sell its campus to Iona. All of these agreements added additional layers of LCEF security over CCNY’s main campus property, and extended the LCEF’s secured interests to additional properties that weren’t included in the pre-2021 mortgages.
On February 23, 2021, CCNY president John Nunes signed a $2.95 million mortgage with the LCEF, which in exchange gave the LCEF a secured interest in 15 properties on- and off-campus. This mortgage covered the four main campus properties (at 171, 182, 187, and 193 White Plains Road), as well as 11 additional properties that don’t appear in any prior agreements.
On the same day, Nunes signed four mortgage modification agreements which “spread” prior mortgages from 2014, 2017, 2018, and 2019 over the same 15 on- and off-campus properties. CCNY did not receive anything in consideration for spreading these mortgages over its additional properties.
The properties newly covered in the 2021 mortgage agreements are a combination of land, athletic fields, and off-campus housing. All of these properties have since been sold, are under contract, or are included in the proposed campus sale to Iona as outlined in CCNY’s petition to the Westchester County Supreme Court.
CCNY originally stated that it would sell its campus to Iona at the end of 2021 summer term. However, it did not submit its petition to sell the main campus property until October 4, and as of now it still has not sold the campus to Iona.
CCNY did manage to sell several off-campus houses in August and September of 2021. New York State law says that non-profit organizations can execute smaller transactions like this without prior review by the Attorney General or New York State Supreme Court.
On August 31, CCNY sold three houses at 16 Hobart Street, 225 White Plains Road, and 230 White Plains Road to three different LLCs for a combined $2 million.[9, 10, 11] Two weeks later, on September 16, it sold another house at 205 White Plains Road to a fourth LLC for $999,000, narrowly avoiding the “mansion tax” New York State imposes on real estate purchases over $1 million. The LLCs which bought these four houses all list the same address on the sale deeds, and filings made with the New York Secretary of State suggest all four LLCs are run by Gregory Holcombe, whose children attended The Chapel School on CCNY’s campus years ago.
Another home at 214 Midland Avenue in Tuckahoe sold on September 29 for $500,000 to an individual named Laidon Zekaj. Zekaj works for Batska Consulting Group, a construction services firm that lists among its clients NewYork-Presbyterian Lawrence Hospital in Bronxville, as well as other NewYork-Presbyterian hospitals in New York City.[14, 15] The property next-door, at 212 Midland Avenue, is also under contract for $495,000.