By Kyeland Jackson —
U of L’s giving development rights for some properties to NTS, a real-estate company, for money.
The deal gives NTS development, construction and management rights to three buildings on the Shelbyhurst campus. In return, NTS will pay U of L $105,000 more to rent the buildings and increase rent for its land lease. Keith Sherman, the U of L Foundation’s interim executive director, said the agreement frees the university from debt and construction costs.
“We’ve got an obligation to go back to those partners and say, given the changing circumstances around the foundation, the real estate foundation, we’d really like to renegotiate and not be in the real-estate development business today,” Sherman said. “So all we will do related to buildings four, five and six is collect land-lease rent every month.”
The University of Louisville Real Estate Foundation announced the move Tuesday. Sherman says demand for office space in the buildings grew, citing their ideal suburban location. NTS then approached the ULREF around three weeks ago, suggesting they develop another building on that land.
But Sherman says the university’s strategy has changed and it may sell properties to support itself. U of L donors’ demand for change prompted the Alvarez & Marsal audit, which alleged the ULF misspent more than $40 million on properties. Sherman says the ULREF’s goal now is to focus on the university.
“The real estate foundation and the foundation, are acutely focused on financial stability, short term and long term, and this is just one step in doing that,” Sherman said. “If there’s a way to sell (properties) … and, again, raise some money and alleviate some of our debt and, or, repurpose that money for something that more strategically meets the university’s purpose, it makes sense to do that.”
Sherman will report the news to the full ULF board in a meeting Thursday. The agenda for that meeting is here.
File Photo / The Louisville Cardinal