NYU gives its stars loans for summer homes

Tim Goral's picture
Wednesday, June 19, 2013

Follow one of Fire Island’s quaint footpaths away from the ferry dock, past modest cottages and better-appointed vacation homes, to an elegant modern beach house that extends across three lots. A composition in bold, unadorned planes, it has a perimeter of green and two separate entrances, each outfitted with the long ramps that are the local custom.

Its most interesting feature, however, is not architectural, but financial. The house, which is owned by John Sexton, the president of New York University, was bought with a $600,000 loan from an N.Y.U. foundation that eventually grew to be $1 million, according to Suffolk County land records. It is one of a number of loans that N.Y.U. has made to executives and star professors for expensive vacation homes in areas like East Hampton, Fire Island and Litchfield County, Conn., in what educational experts call a bold new frontier for lavish university compensation.

N.Y.U. has already attracted attention for the multimillion-dollar loans it extends to some top executives and professors buying homes in New York City, a practice it has defended as necessary to attract talent to one of the most expensive cities on earth. Mortgage loans to Jacob Lew, a former N.Y.U. executive vice president, part of which was eventually forgiven, became an issue during Mr. Lew’s confirmation hearings as treasury secretary this year.

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