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Journey Christian Church

Adaptive Re-Use

A North Point Strategic Partner Church located in Midlothian, VA

Growing, growing, growing

Journey Christian Church, a North Point Strategic Partner Church located in Midlothian (Richmond), VA, was the 21st Fastest Growing Church in America when we met them in 2014. At that time, the lead pastor had taken over the church and blown out the capacity of the existing facility, so the church was paying a mortgage on a church property and renting out the 900-seat auditorium of the high school across the street. Journey had been approached with the opportunity to purchase a 40-acre tract of land within walking distance of its location, and contacted us to help them procure funding for a future project.

We conducted a one-day, on-site Vision Feasibility Analysis to help them pursue options. Upon completing a pro forma for the church based on the adult and family attendance, we quickly learned that the land development project would potentially cost them north of $14MM (including the land purchase) to build out a 40,000SF facility, and that 40,000SF was far less than what they needed to get into the building, accommodate the ministry needs of the congregation, and ultimately put them in a financial position to take on more projects as a result of the ministry demands on the church. With that in mind, we recommended that the church look at other options, including a 110,000SF Costco building we found for sale a few miles away on 13 acres with 1,000 parking spaces, listed at the time for $4.5MM. We pursued the Costco building, and ultimately helped the church purchase the facility for $2,750M ($25/SF).

 

A solid financial strategy

As we were putting the building under contract, we began our work in assisting the church with selecting an architect and fundraising consultant based on the financial strategy we had put in place for them. We helped to manage the due diligence process, including conducting a Property Condition Assessment, inspection, cost analysis, concept floor plan, exterior renderings, etc. along with the help of Equip Studio, an architecture firm based in Greenville, SC. We also engaged with a total of 10 banks during that time, which resulted in 7 offers to lend for both the acquisition and development of the Costco building, as well as the refinance of their existing debt tied to their old facility, which was put on the market for sale.

During the design process, we assisted the church in creating a total budget for the project and engaging a local General Contractor to assist in the pricing process during design. Throughout the project, we were able to identify over $2MM in cost savings opportunities, and the church moved forward with construction of a 55,000SF, 900-seat with a total project budget of $5,500M, including all-new MEP systems, major roof repairs, and all soft costs. This means that JCC was able to get 15,000SF more for over $6MM less, and is able to move into their new facility 2 years sooner than the originally proposed land development project.

The lending institution selected provided the church with a 7-year fixed rate at 3.95%, with a 5-year fixed rate interest only period. The reason for this was to allow JCC to be able to move into a Phase-2 project, scheduled within 2 years of Phase 1, without having to go back to the bank(s) or disturb the current debt structure in order to facilitate that future growth.

Under Construction

Journey is currently under construction and is looking to move into their building in January of 2017.

Services Provided:

  • Vision Feasibility Analysis
  • Long Term Financial Strategy
  • Relocation
  • Property Purchase
  • Adaptive Re-Use Project
  • Relocation
  • Budget Control
  • Program Management and Owner’s Rep Services
  • Lender Engagement and Negotiation
  • Project Funding