What is the goal of RENEW2?
A team has been established to create and launch a second church-wide, multi-year, fund-raising campaign beginning Fall 2020 to retire the remaining Project RENEW indebtedness ($675,000 as of June 2020).
Fifth Church still had $675,000 in outstanding loans in June, and this total has been reduced to $575,000 by early August thanks to an additional gift of $100,000. We’re blessed that the original campaign pledges, budget excess, and other major gifts have paid down a significant portion of these loans. Now is the time to retire the rest of the debt and position ourselves for the next chapter in our church’s ministry.
What is the current debt situation?
There are two loans that Fifth owes the RCA Church Growth Fund.
1) $100k at 3% for 24 more months. Then adjusted to CGF Base Rate.
2) $475K at a 4.375% for 24 more months. Then adjusted to CGF Base Rate.
3) CGF Base Rate is currently 4.24%
4) Maturity of both loans is 5/31/45
Why did we start construction without raising the requisite funds?
According to the Breton Group (a consulting firm for nonprofits) and the RCA Church Growth Fund, it is not unusual, today, for churches and non-profit organizations to begin construction projects before funds are fully pledged and collected. In 2016 these two organizations estimated that Fifth, based on our member demographic and collective giving history, was able to pay forthe $1.5 million projected cost through various forms of fund-raising.
The timing to build was right. Our construction partner, Michael Garrett from Pinnacle Construction, had an opening in the build schedule for our church project. Because of our partnership,we saved $200,000 or more in construction costs as follows:
○ A 5-7% overall contractor’s fee is very common for commercial construction. Pinnacle did not charge a fee.
○ Pinnacle was able to split the supervision cost between Fifth and a project at Breton Village - Fitzgerald's Men's store. The two project's ran simultaneously, saving 50% of the supervision cost ($25-35K savings).
○ Construction costs have gone up on a consistent basis over the past several years due to demand, growth in the GR Metro area, and low interest rates. A project like Fifth in the open market would easily cost 20-30% more. Building two years earlier at a 10% annual savings would amount to $300,000 saved.
What specific renovations/additions were made during this $1.5 million project?
An expanded entrance and lobby area
6,000 additional sq ft
Additional bathrooms in close proximity to the lobby
New carpeting throughout the main floor
Better access to the kitchen area from the lobby
Improved kitchen work spaces
Improved technology to support those with a hearing impairment
Sanctuary updates including a larger front stage, ADA compliance, and new audiovisual equipment
Why pursue RENEW2 at this time (pandemic, etc.)?
Overall benevolent fund need has been lower than expected, and giving to the benevolent fund itself has increased. We are able to meet our community’s current demands on this front.
We are thankful that, despite general uncertainty brought on by the pandemic, it appears that the Fifth family has not been significantly impacted financially. In other words we appear to be in a place financially where we can continue to pay off the Project RENEW loans..
We don’t want to lose momentum that has been built from the first campaign and recently boosted by an anonymous gift for Project RENEW of $100k.
Feedback from the congregation and church leadership is that they wish to get the loan paid off so that we can put more resources to new initiatives - to plant churches, grow disciples, and more.