Palo Alto University, a private, nonprofit higher education institution with about 1,000 students, has made its final mortgage payment to lender Comerica Bank and is now officially debt-free. To mark the event, the California university hosted a “mortgage-burning” ceremony on October 9 in the Amy M. Wisniewski Hall on its Allen Calvin campus.
Founded in 1975 as the Pacific Graduate School of Psychology, Palo Alto University purchased its current location at 1791 Arastradero Road in Palo Alto in 2008 and moved there in the summer of 2009. The same year, the university signed a swap transaction for $1.7 million, which fixed the rate of its loan at 4.7 percent.
“This is a historic moment for PAU, and could not have been done without the help of so many people, from our CFO June Klein to our trustees and our many donors who have given so generously over the years,” said Allen Calvin, president of PAU. “Because of this, we were able to pay off this debt in record time—in just four short years.”
Mr. Calvin said that he also had to recognize the bank for providing financing during a time when lending rules had tightened. “This is an example of how a bank can be good, when it is made by good people,” he said.
The university credits the move, the expansion of its degree programs and its prestigious faculty for strengthening its reputation, which has attracted more students and increased PAU’s financial security and reserves.
Robert Muzio and Thao Nguyen, two senior vice presidents of Comerica Bank, attended to the “mortgage-burning” ceremony.