After seven years of leasing space at the Albert L. Schultz Jewish Community Center in Palo Alto, the Mid-Peninsula Jewish Community Day School is about to get a home of its own.

A $1 million grant from the S.F.-based Jewish Community Federation's Endowment Fund has enabled the school to secure a 1.5-acre building site immediately adjacent to its current space at the ALSJCC.

Estee Solomon Gray, immediate past president of the school's board of directors, said the grant has helped save the school from a crisis: The lease on two of the six classrooms it rents from the city of Palo Alto expires in June, 1999, with no hope of renewal.

The remaining four classrooms are on a long-term lease from the ALSJCC.

"We have to be in the new building by the time the lease on those two classrooms expires," said Solomon Gray. "The grant took us from an uphill struggle financially to a feeling of `Yes, we can do it.'"

The rapidly growing day school, originally seed-funded by the JCEF to serve 31 children in kindergarten through second grade, now serves 139 children through fifth grade. It attracts students of various levels of observance and economic backgrounds, and has waiting lists for the fall.

Calling the endowment grant one of the largest in recent years, Bernard Osher, JCEF committee chair, said the $1 million figure represents about 10 percent of the building's budget for the project, providing the early funding that will enable the school to obtain additional funds from donors.

The grant has prompted former Redwood City resident Henry Lehmann to write a thank-you letter. Lehmann, now of Baltimore, has two grandchildren attending the school.

"This has set an example to other federations around the country on how to support major new Jewish educational projects," he wrote.

Endowment committee member Laura Heller Lauder said the grant reflects the federation's overall funding priorities, which put a premium on Jewish education.

"Our vision is that the new day-school building will become more than just an elementary school. It has the potential to also serve as a center of adult Jewish education and resource for the entire area," she said, noting that similar day-school/JCC campuses operate successfully in other cities.

The day school's new facility will contain 12 classrooms capable of serving 240 students in three structures surrounding a large, enclosed courtyard. The school will continue to rent four classrooms from the Schultz JCC and share its auditorium, athletic facilities and meeting rooms. In return, the ALSJCC and other Jewish organizations will be able to make use of the school's new space on nights, weekends and in the summertime.

A number of Jewish organizations, including the JCF, Jewish Community Relations Council, a Sephardic congregation and a secular Sunday school currently share space with the school at the ALSJCC.

"It's so wonderful for our kids to be able to continue going to school in the heart of the community," said Solomon Gray.

In addition, it is located within two miles of Stanford, which has a department of Jewish studies and a Hillel, and a number of Jewish congregations.

"The school is really in the hub of the South Peninsula Jewish community," said Heller Lauder.

The grant to the Mid-Peninsula Jewish Community Day School was one of 16 totaling $1,940,010 million recently allocated by the JCEF committee to local, national and overseas Jewish organizations and projects.