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Many of you are aware that a little more than 12 months ago, 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, closed the house and asked the final six DU undergrads living in the house to move out. We then started the process of finding a buyer for the property.
Preserving 117 Ash Avenue for DU Alums
Conversations among DU alums from many generations made it clear that no one wanted to see our DU home sold and then potentially demolished. Therefore, in an effort to “buy time” a formal Offer was made by Jami Larson, an Iowa State DU Alum (Class of 1974), to buy an option to purchase the property.
As Jami Larson stated in his Offer, it was presented to the corporation board representing the alumni of the Iowa State Chapter of Delta Upsilon Fraternity in order “to provide an opportunity for its members 1) to preserve the history and tradition of the Iowa State Chapter by protecting its 1934 Chapter House from the possibility of demolition; 2) to potentially allow its past members the ability to enjoy a renovated and improved Chapter House structure that would welcome each of them and their family members when visiting Ames and Iowa State University; and 3) to assist a potentially more active and rejuvenated DU Alumni organization in its efforts to re-establish a strong and respected undergraduate chapter that would be able to create similar positive, lasting memories to those that we DU alums all cherish.”
Sale of Chapter House to 117 Ash, LLC
Although the Offer was not actually exercised, Jami did agree to take over the mortgage of 117 Ash Avenue (a debt of approximately $245,000). The deferral of mortgage payments for more than a year has allowed the Colonnades time to evaluate various options for remodeling the house. And, it has provided an opportunity for a group of DU Brothers to put together a limited liability company that has now agreed to purchase the chapter house at 117 Ash for $260,000. 117 Ash, LLC, the newly created company, will assume the existing mortgage. The Colonnades will then use the net proceeds to pay off deferred interest and accrued property taxes still owed.
117 Ash, LLC is a for-profit, limited liability company (corporate liability protection with partnership tax treatment).
Working with Jami Larson, DU brother Craig Foss (Class of 1971) has been busy drafting the Operating Agreement which will govern the company. The limited liability company is intended to have an ownership base made up entirely of ISU DU Alums. In order to entice DU brothers to invest in this venture, we intend to create a financial model that will be profitable in a relatively short period of time.
Colonnades will not go away! If we are successful in bringing a strong DU Chapter back to Iowa State, the Colonnades will have an important role to play in representing the interests of the DU undergraduate chapter and our alums as one of the Managers of 117 Ash, LLC.
Future use of the Chapter House
117 Ash, LLC has been founded to 1) preserve the history and tradition of the Iowa State Chapter of Delta Upsilon by restoring and protecting its 1934 Chapter House, and 2) provide a financial return to its Members (owners) in the form of tax credits, potential profits, and other tax considerations.
With a profit motive in mind, 117 Ash, LLC must consider several different potential uses for the building once it is renovated. Possible uses that will be discussed and evaluated by its Managers during the next six months include:
- 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
- Home for an ISU Learning Community, such as the ISU Entrepreneurship Learning Community (currently housed in Buchannan Hall)
- A Bed and Breakfast with coffee shop in dining room area
- Apartments with restaurant on main floor and café on lower level
- Active undergraduate fraternity or sorority house for another Greek organization
- 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.
Short-term Financing Plan- Sigma Phi Epsilon Lease
Several work sessions have been held among DU Alums during the past twelve months to “gut” the study room and to prepare the Front Entry, Chapter Room, Trophy Room, Dining Room and Kitchen for major remodeling.
This volunteer work has been successful in making the house “livable” enough that the Sig Ep’s have expressed an interest in leasing the house for the 2010/11 academic year in nearly “as is” condition. Some minor electrical work, carpet remnants and paint will allow 117 Ash, LLC to receive $6,000 per month for 9 months. Additionally, the Sig Ep’s will pay for insurance on the building, and they will pay for all costs of occupancy (utilities, minor maintenance, cleaning, etc.)
This arrangement will not only provide approximately 40 men from Sigma Phi Epsilon inexpensive housing while their existing house receives a multi-million dollar renovation next year, it will provide the alumni of Delta Upsilon financing to start our own renovation project.
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Sunday, September 05, 2010 
