It took Harvard only one day to sell an unusual $245 million package of bonds, put on the market yesterday morning, according to University officials. The money raised will finance all construction and renovation underway on campus, as well as several major projects planned for the near future.
"It's all sold," said Financial Vice President. Thomas O'Brien. "Everything went smoothly." O'Brien and other Harvard officials have estimated that the sale of the long-term, tax-exempt bonds was the largest transaction of its kind ever undertaken by a Massachusetts educational institution.
The bond sale was handled by a consortium of prominent New York investment firms, who apparently had no trouble finding buyers for notes that will mature in 30 years, at an interest rate of slightly below 7 percent.
Most transactions comparable to Harvard's are completed within a 48-hour period, said Rich Garonzik, an underwriter for Goldman-Sachs, one of the firms managing the sale.
Garonzik added that a variety of private individuals and large firms purchased Harvard bonds but that specific information on the identity of buyers is not available.
Harvard officials said earler this week that the University made the sale at this time to take advantage of current low interest rates and to spread out payment for construction projects now totalling $195 million.
Harvard will now be able to pay back a single centridized debt over 30 years, rather than scrambling on a case-by-case basis to keep up with sizeable construction bills, the officials explained.
Projects financed by funds raised yesterday include the $50 million renovation of the Houses, the Fogg Art Museum and Kennedy School of Government expansions, and renovations on scientific laboratories.