Olentangy Campus Update
Here is an update
about where we are concerning the Olentangy Campus lease space. When we think
about our options for financing the lease space build out and our future land
purchase, we have a couple of options:
·
Option 1: Finance the lease space through a loan
against our equity from the north campus & use the Back40 funds to purchase
land (Back40 is an 18-month capital campaign that will end in May 2010)
·
Option 2: Use the Back40 funds to build out the
lease space & use our equity in the north campus to borrow money for land
when God gives us that opportunity (or commit the equity from a sale of the
north campus towards a land purchase).
When we discussed
how to pay for the lease space the Ministry Leadership Team (MLT) wanted to
take into account all of the options that may
be necessary to resource the project.
Without the capital in the bank for the build out of the lease space, we
thought it necessary to ask the church for the ability to use the equity we
have in our north campus if necessary to pay for the project. So, we would be expending our north
campus equity, while holding onto our Back40 capital commitments in case God
led us to an available piece of land.
That’s Option 1 from above.
Option 2 may make
more sense for us in light of how quickly we are filling up our current
facility space this fall. We just
had our largest attended month ever and parking continues to get tighter at the
north campus. We could utilize the
Back40 funds we have available now (approximately $150,000) and what’s left to
come in from the Back40 project for the lease space build out. Another reason this may be the best
option for us is that in general banks only like to make loans where there is a
strong equity position for them.
In our case, there’s not a lot of equity in a lease space for a
bank. By utilizing the second
option, we would still maintain the
opportunity to utilize our equity when the timing is best to purchase land. We may
be able to utilize a bridge loan from the North American Mission Board so that
we can begin the lease space build out sooner and pay it off with the Back40
commitments as they come in. It
will save us from borrowing such a
large amount of money now and keep us from making the lease build out payment
from our 2010 budget. In
essence, we are borrowing the money from ourselves instead of borrowing and
paying interest to a bank/financial institution. We are going to pay that borrowing back with the equity we
have in the north campus.
Here is the prayer request: please take some time to think about
and pray about this decision…feel free to give anyone on the MLT your feedback. We will have to make this decision as a
church body. This is a decision we
are considering at this point not one that has been made. We believe it will make the move to the
lease space much more smooth and it will fit into our budget better for
2010. We hope to hear the results
of the appraisal done on the north campus the last week of October. The appraisal will help us determine
the real value of the north campus and thus our equity.
The second thing to
pray about is that this makes your
Back40 commitment more important than ever…our pledges were above and
beyond our regular tithes and offerings.
We have seven months left to finish our commitments and we have received
approximately 55% or our commitments.
We will be building out the lease space based on the Back40 commitment
amounts, so if you need more time to finish your commitment, you need to adjust
your commitment, or would like give an extra commitment, you can contact our
Financial Director, Brian Grashel, at brian@lifepointcolumbus.com. Thanks for praying, giving and serving!
Olentangy Campus Drawing