NP has more success negotiating with lenders than newly-formed student groups do. Lenders, including banks, community development loan funds, other cooperatives and individuals generally feel more comfortable lending to an established organization like NP, with its proven track record of development and management, than directly to a new co-op.
Most small businesses fail in the first years of existence. Furthermore, small co-ops often cannot sustain the myriad management tasks a co-op housing organization needs to perform. Management Agreements with NASCO Properties, which are a necessary component of ownership through NP, guarantee that property taxes, mortgages, and insurance are paid and ensure the security of all these projects. NP works with member co-ops on organizational development as well, helping co-op groups grow into responsible businesses capable of self-management when the time is right.
Before the creation of NP, newly-organizing student groups relied solely on government financing, goodwill of established student cooperatives, and other benefactors to arrange risky financing for co-op start-ups. With ownership of some buildings at a central level, new groups have access to financing options using NP's accumulated equity. Over time, growth in the NP equity pool will enable many more student co-ops to be established, and will increase the affordability of student co-op housing.