For many nonprofit organizations, real estate is more than a place to operate. It can be one of the organization’s most significant assets and, when used strategically, a source of capital to support growth, strategic initiatives and the services they provide to their communities.
Accessing that value, however, isn’t always straightforward. Juniper Capital has seen a growing trend of nonprofit organizations turning to private lenders to leverage their real estate holdings for liquidity, growth and support of their service offerings. Yet, because of their financial structures and the typical lack of a personal guarantee, nonprofits can have difficulty finding financing that allows them to leverage their real estate assets. These challenges have become more pronounced in the current lending environment. This is where Juniper takes a different approach.
“We lend based on the underlying collateral, not simply the specific entity or organization. We’re proud to work with nonprofits because we know the important role they play in our communities. Many nonprofits have a difficult time finding lenders willing to work with them, and we’ve always taken a community-centric approach to lending. When we can structure a deal that works for both sides, it’s something we’re proud to be a part of.”
Kurt Ursich, President, Juniper Capital
Looking at the Deal, Not Just the Organization
Juniper’s lending model is built around understanding the individual circumstances of each transaction.
That means looking beyond the type of organization seeking financing. Whether a borrower is a nonprofit, a business or another type of organization, the fundamental questions remain the same: What is the underlying real estate worth? How much leverage makes sense? What is the borrower trying to accomplish with the capital? And can the financing put the borrower in a stronger position to achieve those goals?
“We’re really looking at whether the deal makes sense for both sides. What is the borrower trying to accomplish? Does the property support the loan? And can we structure the financing in a way that helps the borrower succeed? If they succeed, we’re successful too.”
Matthew Akers, Vice President, General Counsel
Those considerations help Juniper determine whether a transaction makes sense for both the borrower and the lender.
It’s this relationship-driven, community-centric approach that allows Juniper to consider circumstances that may not fit a conventional lending template, while maintaining a disciplined focus on the property, financing structure and borrower’s ability to succeed.
Juniper has significant experience working with nonprofit organizations to address these challenges. Two recent transactions illustrate how that approach can work in practice.
Putting Real Estate to Work
Supporting the Boys & Girls Clubs of Portland
The Boys & Girls Clubs of the Portland Metropolitan Area needed additional liquidity to pursue several key strategic initiatives. The organization used two of its existing club facilities as the foundation for a cash-out refinance with Juniper.
The financing provides access to capital that can support the organization’s broader objectives while allowing it to continue using the facilities to serve its community and help facilitate the mission of enabling young people to reach their full potential.
For Juniper, the transaction demonstrates how an organization’s existing real estate can become a resource for pursuing its broader mission and strategic goals.
Creating Flexibility for Seattle Jewish Community School
In Seattle, Seattle Jewish Community School was looking for working capital to pursue several growth initiatives. Juniper provided a low-leverage cash-out loan, allowing the school to leverage its existing real estate while maintaining a conservative level of debt.
The transaction also demonstrates another aspect of Juniper’s model: common-sense underwriting. Rather than imposing prohibitive underwriting requirements, Juniper evaluated the school’s individual circumstances, structured an appropriate loan and closed quickly.
The organization and its needs were different from those of the Boys & Girls Clubs, but the fundamental lending process was the same: understand the borrower, the asset and the objective, then determine whether the transaction makes sense.
Supporting Organizations that Strengthen their Communities
For Juniper, these relationships reflect the company’s broader connection to the communities it serves. Juniper believes strongly in the importance of education and community and is pleased to have been a partner to these organizations.
The Boys & Girls Clubs and Seattle Jewish Community School serve very different purposes and communities, but both benefit from access to capital that can support their continued growth.
For nonprofit organizations with significant real estate holdings, the right financing can provide more than liquidity. It can create flexibility to pursue strategic initiatives, invest in facilities, strengthen operations or expand the services they provide.
At Juniper, finding the right financing starts with understanding what the organization is trying to accomplish. The question isn’t simply whether a borrower fits a traditional lending profile. It’s whether the property, financing structure, objectives and overall opportunity make sense for both sides.
When they do, Juniper works with the borrower to find a way forward.
