Groton — Charter Oak Federal Credit Union announced Tuesday that it will provide a $1.5 million loan for the renovation and expansion of the Interdistrict School for Arts and Communication in New London.

The improvements will equip the school with new physical education, performance and community space.

“This $1.5 million loan package will allow the ISAAC school to meet its growing needs for decades to come — and benefit all its students and faculty,” Brian Orenstein, Charter Oak’s chief executive officer, said in a statement.

ISAAC, a public chartered middle school, is located at 190 Gov. Winthrop Blvd.

“We are thrilled to get this project off the runway,” Gina Fafard, the school’s executive director, said. “Our students and families will benefit greatly from this community space. We feel this is a major contribution to the continued enhancement of downtown New London.”

School and city officials and local legislators marked the start of the project at a June 14 groundbreaking. Charter Oak and school officials closed Aug. 7 on the financing package.

The project will include demolition to make way for a larger gymnasium, a school assembly area and space for the school’s music program, an essential part of ISAAC’s creative arts-and-communications curriculum.

The Carlin Construction Co. of New London has been awarded the construction contract. The project architect is Lindsay Liebig Roche LLC of New London.