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An active undergraduate chapter of Delta Upsilon Fraternity, if a separate effort to re-establish a DU Chapter is successful during the academic year beginning in the fall of 2010
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Home for an ISU Learning Community, such as the ISU Entrepreneurship Learning Community (currently housed in Buchannan Hall)
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A Bed and Breakfast with coffee shop in dining room area
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Apartments with restaurant on main floor and café on lower level
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Active undergraduate fraternity or sorority house for another Greek organization
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Other concepts that may combine some of the above
Obviously, the hope would be that we can develop a model that would ultimately lead to the re-establishment of an active undergraduate chapter of Delta Upsilon. However, this rebuilding of the ISU Chapter of Delta Upsilon may take several years to accomplish, and it will be important that the use of the structure is financially feasible immediately upon completion of a major renovation project.
Financial Model for 117 Ash, LLC
One of the problems of the current financial model for 117 Ash Avenue centers on the fact that the Colonnades Corporation, which is the not-for-profit corporation representing ISU Alumni of Delta Upsilon Fraternity and the legal owner of 117 Ash Avenue, has always been run by a group of DU alums. As much as these alums have cared for our DU home, most of the volunteers have lived away from Ames and have been busy raising families and building their careers. No member of Colonnades ever had any personal “skin in the game” as it related to filling or maintaining the house.
The financial model for 117 Ash, LLC is different. Our hope is to find a relatively small group of Iowa State DU alums (25 to 50) that will be willing to invest either $15,000 (Class B Membership Unit cost) or $50,000 (Class A Membership Unit cost) into a “for profit” venture that will lease the house back to an organization (hopefully, a newly reorganized Chapter of Delta Upsilon Fraternity) that will pay rent to 117 Ash, LLC. Because we will have “skin in the game”, the owners of 117 Ash Avenue should be able to make this model work the same way that any other successful landlord in the Ames area has leased property.
The accompanying “117 Ash, LLC Financial Analysis” lays out the renovation cost assumptions, the potential equity structure model, the proposed revenue and occupancy projections, the estimated operating and financing expenses, and the cash flow and income projections for a 15 year period. You will note that this analysis shows a potential annual rate of return of 4.8% annualized over a ten year period. This may not sound “great”, but it is also exclusive of any State or Federal Tax Credits, which could amount to more than 50% of a Class A Member’s investment in 117 Ash, LLC. Of course at this time this analysis is just an estimate based on numerous variables. Actual results will depend upon those variables.
The intent is to allow all interested DU Alums to participate in this effort in some manner or another. Major investors of $50,000 or more will be rewarded with a larger percentage of the potential tax credits. However, investors at the $15,000 level will still share in credits, too. And, brothers who wish to form their own partnership may also decide to pool lesser amounts of money to buy a Class B Membership Unit.
Some brothers may not want to “own” a part of the house. They can still just “donate” to Colonnades, who will be represented on the Management Committee for 117 Ash, LLC and is also desirous of owning a portion of the investment. And, because a major portion of our re-investment in the house will be for study rooms and educational purposes, we are hopeful that other specified donations can be channeled through the DU International or ISU Foundation to be considered as “tax deductible”.
Most importantly, however, is the fact that these seemingly small returns will allow for the preservation of our cherished DU home at 117 Ash Avenue. The property can be owned by a group of caring Iowa State and DU alums. It will make it possible for all of our DU brothers to enjoy sharing time together in a property of which they can be proud when they come back to visit Iowa State. DU brothers will now have a chance to own a piece of their Iowa State heritage! This is not an offer, if you are interested, more information will be provided upon your request. For additional information contact Jami Larson at jlarson101@aol.com
Sunday, September 05, 2010 
