Congregational Vote April 27 & 28, 2019
- Sales of ACAC’s Warehouse building to Urban Impact Foundation (UIF).
- 10-year lease of ministry space to UIF.
- Expand scope of HUB project to add another floor.
Who is UIF and why is their relationship to ACAC so important?
Urban Impact Foundation (UIF) was started as an extension of the vision God gave Pastor Rock for ACAC over 34 years ago. As we assessed the magnitude of the need in the community around ACAC, we knew we could never fund all the ministry needed by through our church offerings. Our peopl are incredibly generous, but they are not wealthy! We also recognized there are charitable foundations desiring to invest in the needs of communities that will not fund church initiatives. I think you understand why. Every church in existence would be knocking at their door, and frankly, many of them would not be prepared to use the funds wisely.
It was out of this recognition that, in 1995, we decided to form UIF as a separate 501c3 non-profit corporation. The goal was to invest in the lives of the community children and youth with programming in the arts, athletics, and academics, thereby breaking cycles of poverty and despair and affording these young people the opportunity to know Jesus. Pastor Ed Glover, our youth pastor at the time, was tasked to head UIF. We funded his full salary for one year, then observed a decreasing subsidy schedule as he secured funding through grants and gifts.
The strategy has been eminently successful. UIF programs reach into the North Side communities to touch over 1,900 children in the last year alone. Many of these kids are unchurched and come to faith in Christ through a relationship with one of many UIF “urban missionaries.” Over the years, as UIF has grown and matured as an organization, so has its partnership with ACAC. Today, the leaders of both organizations see this relationship as vital to continuing and expanding our Kingdom impact on the North Side into the next generation.
Why is it important for UIF’s staff and offices to remain on our campus?
Although UIF has many church partners, ACAC is the natural church home for so many of the unchurched children and families participating in UIF programs. Recognizing this, our two respective staffs continue to work hard to build the “relational bridges” needed for this to happen. Were UIF’s headquarters to be moved off our campus, out of sight could easily become out of mind! In addition, so many of UIF’s programs are run out of ACAC’s ministry spaces, that close coordination and collaboration between our respective staffs is imperative. The continued close proximity of our staff members on ACAC’s campus facilitates all of this.
When we propose selling the “Warehouse” building to UIF, exactly what building are we talking about?
ACAC’s “Warehouse” building sits on the west side of our campus directly behind our sanctuary. It is an unheated building with an unfinished interior that currently is suited only for use as a storage facility. The exterior of the building is also in clear need of refurbishment.
Why sell the Warehouse to UIF?
Since ACAC purchased the Warehouse in 1998, its one and only use has been for storage. That would continue to be the case were it not sold to UIF. It was not slated for renovation as part of our current campus redesign plans. Neither is the footprint of the building considered critical to some other future project on our campus. For example, architects have assured us that the Warehouse site would not be needed should we proceed with plans to build a parking garage. In fact, even if we decide at some future date to enlarge the size of our sanctuary, such an expansion would leave the Warehouse building intact.
The Warehouse will work wonderfully, however, as a separate, identifiable headquarters building for UIF on our campus. It will also provide UIF with the space they need to grow. Significantly, UIF leaders are convinced their donors will embrace the challenge of raising the estimated $1.9M it will take to renovate and beautify the building.
From a functionality standpoint, the Warehouse would provide UIF with their own front door into the community, i.e. on-street access onto the Allegheny Center circle. However, the rear of the building would also allow for direct access into our program spaces via ACAC’s new HUB building.
What other options have been considered?
Many other on-campus options were considered as potential UIF headquarters sites over a two-year period, only to be rejected for various reasons. One key issue was that UIF’s donors (naturally) wanted to own, rather than lease, their permanent headquarters building. Of course, ACAC leaders weren’t looking to sell any of our well-used ministry buildings.
Also, perhaps we overlooked the Warehouse as a possible solution, because it doesn’t currently look the part of an attractive headquarters building. However, all the architects and designers we have brought in as part of the larger campus redesign effort have commented on the potential of the Warehouse to be great space for such a purpose.
Is the price for the Warehouse fair?
As part of their due diligence efforts surrounding this transaction, UIF had the Warehouse independently appraised at $325,000. Of course, because of its location as a fixture on our 2.2 acre campus, the building has greater value to ACAC, or to UIF.
What is the plan for the Warehouse if it isn’t sold to UIF?
If ACAC were to retain ownership of the Warehouse, the building would continue to be used as raw unfinished storage. There are no funds in our campus redesign plans to renovate it. ACAC would probably make some modest effort, like painting the exterior of the building, to make it less of a visual distraction.
Can UIF afford the Warehouse purchase and ministry space lease agreements?
Over the course of our discussions, UIF has been very willing to “open their books” to ACAC leaders. Our interest was to assure that the purchase of the Warehouse purchase and lease of ministry space wouldn’t inhibit UIF’s ability to continue do such effective ministry in the community. In fact, the Lord has blessed UIF financially and they have grown significantly in recent years. These transactions would not compromise UIF’s financial position and, in fact, are believed to be reasonable investments that lay the groundwork for their continued work on the North Side for years to come.
What protections are in place in the event UIF decides at some future point to sell the Warehouse?
The agreement will include language guaranteeing ACAC the right-of-first-refusal to buy back the Warehouse in the event UIF wants at a later point to sell. In addition, to protect ACAC’s congregation from outside deep-pocket bidders, this covenant will put a cap on the maximum repurchase price ACAC could have to pay to re-purchase the building.
Why are we leasing ministry space to UIF (10-year lease) when right now they use the space for free?
There are at least two important considerations here. First, if they are to build their permanent headquarters here in the Warehouse, UIF believes it is vital to also ensure long-term access to the ministry spaces to run their programs. Our current month-to-moth arrangement with UIF is all based on goodwill and carries no such security. The lease, on the other hand, would provide such security for at least 10 years, plus an additional 5 years if UIF exercises its option to extend.
Second, the lease offers a fair-value way for UIF to participate in ACAC’s campus redesign project. Keep in mind, the expansion of our ministry spaces also provides a great benefit to UIF, who will share in the usage of those spaces.
How is the lease price and term being determined?
Determining the price of the leased ministry space was an interesting part of this agreement. When the HUB is completed, ACAC will have approximately 75,000 sq. feet of ministry space, all of which can be shared with UIF for their program needs. But “shared” is the key word. None of the space will be reserved 24x7 for UIF’s needs, unlike the case with a typical commercial lease.
As a result, we didn’t try to use typical price per sq. feet calculations to determine a price. Rather, we proposed the whole financial arrangement (Warehouse sale and ministry space lease) as essentially a “swap” of space. In providing UIF with 9,400 sq. feet of floor space in the unfinished Warehouse, we asked for the funds to replace that floorspace with a similar size footprint of new, but unfinished, ministry space on an additional floor of the HUB.
Why should we add another floor onto the HUB?
Our original plan for the HUB provided for two finished floors, the basement (Children’s Ministry) and the ground floor (new lobby.) For budget reasons, the second floor of the HUB was planned as an unfinished floor available for future development. Finances played a key role in constraining the scope of the HUB; the $7.8M budget for the new building was considered by church leaders a faith-stretch for our congregation, where most members are of modest means.
But the original plan had its limitations. The ministry spaces planned for children, youth and young adults were thought adequate for current needs, but challenging, perhaps, in the event of numerical growth. And on the limited footprint of our campus, where building higher is our primary option for expansion, there were serious concerns about the prospect of not being able to add more floors onto the HUB at a future time.
The HUB expansion allows us to address these forward-looking concerns. The availability of two additional finished floors offers our key ministries exciting spaces with room for immediate growth. Adding a third above-ground floor now, also addresses the concern of potentially not being able to do so in the futur, due to changes in building standards and codes.
One added benefit not yet mentioned concerns the roof of the HUB. Adding the third above-ground floor now allows us to seriously consider investing in outdoor ministry space on the HUB roof. Would we invest in rooftop facilities if we anticipated trying to add a floor at a later date? Probably not. But our architects will now be thinking about the roof of the HUB as a potentially incredible outdoor ministry space.
What about Finding Joshua? How does our Succession Planning Process factor into these plans?
Certainly, it’s fair to say that the prospects of ACAC welcoming a new leader in the not-too-distant future is on the hearts and minds of ACAC and UIF leaders as we consider the strategic significance of our ministry partnership. The presence of UIF’s headquarters on our campus, and the lease insuring our commitment to sharing ministry space for years to come, only serves to underscore our commitment to working together to impact our North Side communities for Christ.
A new Lead Pastor will not come to ACAC with decades of history to draw upon with respect to this partnership. But the commitments made as a part of this plan will help ensure that ACAC and UIF continue the hard work of doing Kingdom ministry together well into the next generation.