2023 Church Design Forecast : Trendspotting
The shape of things to come
Many things have changed in ministry over the last 2 years , leading to some new and exciting opportunities .
Construction activity slowed during the pandemic and now appears to be on the rebound . Lending requests for new projects , renovation and expansion have increased and churches are primarily investing in three different types of venues :
# 1 : Retrofitting existing church facilities as part of church acquisitions or mergers During COVID , and to this day , churches facing challenges sometimes are approaching larger and more stable ministries with deeper resources for leadership and guidance . Some ministries that were challenged weren ’ t necessarily in a position to take the steps to grow or found it difficult to adapt to their new normal . It has become more common for larger churches to adopt the smaller ministries into their family — including the real estate and retrofitting the facilities to help meet ministry needs .
# 2 : Satellite expansion , smaller venues Satellite-campus expansion has been a part of the church operating model for many years . Smaller venues have become popular as more people have expressed interest in small groups than in mega venues with thousands gathering on a Sunday . Smaller venues that are active in their local communities have been a more popular expansion strategy to achieve growth . Limiting the size of these facilities can allow leadership to reach communities more effectively and provides more flexibility with budget .
# 3 : Buying and retrofitting non-traditional facilities for church use If a church seeks to expand in another city ,
Lewis Senior Relationship Manager Thrivent Church Financing
it may not do so by making the home church bigger . Rather , finding a vacant or underutilized commercial space and making it work for church use could be a more economical approach , particularly from a cost-per-square-foot standpoint . In fact , repurposing an existing space can literally cost half as much as building from the ground up . As an example , we recently funded the repurposing of a 40,000-squarefoot furniture store . Though unconventional , it was cost-effective and well situated to accommodate the needs of a growing congregation and provide room for continued growth .
But before you build , renovate or reimagine … Whatever expansion approach your church chooses , there are some factors to consider :
Do you actually need all that space ? Carefully consider purchasing more square footage than is feasible or necessary . If your church needs 10,000 square feet and you ’ re purchasing 100,000 square feet , it will drive up maintenance costs . Does your ministry have the financial strength to take on this additional obligation ? And while the vacant strip mall with the potential for lease income may seem attractive , churches generally aren ’ t skilled landlords or property managers . If the space needs renovating , you will also want to make sure to have finances lined up for the project . A Guaranteed Maximum Price ( GMP ) contract with your contractor for any anticipated work can help mitigate construction risk so the church protects itself against any unanticipated changes to project costs .
Is the building you ’ re interested in purchasing attached to other buildings ? If so , shared maintenance costs and the strength of the association will be important factors to consider . Is the roof shared with other spaces ? Is your church responsible for the HVAC and plumbing ? If you meet in a mall , for instance , what if mall management or other tenants go out of business ? If the expenses are shared , could the church end up with a disproportionate cost ? Even if a church itself is healthy , the success or failure of a third party can impact the church and everything attached to the church .
Zoning and parking considerations . Whether or not there ’ s enough parking is a top concern . Will the church own sufficient parking to meet municipal zoning requirements ? Is the property to be acquired zoned for assembly ? For example , if your church is considering purchasing office space , it ’ s unlikely that there will be enough parking for church use . The other important consideration is what improvements will be required for the property to meet all ADA requirements for assembly use .
Above all : don ’ t build until your loan is in place ! Do not start construction until sources and uses of funding are in balance and the lender ’ s mortgage is recorded . If construction begins before the loan is in place , the title company will not be able to provide the lender with its required title coverage for a first lien ahead of any potential mechanics liens . Additionally , the church should not sign and start a contract it cannot fulfill without having its loan in place . Unless your church has sufficient funds to pay for the entire project in cash , it is important the church consult with its lender regarding the construction timeline so all loan requirements are met prior to commencing construction .
Some things never change Real estate investment does not necessarily equate to a successful ministry . The physical building is certainly important for growing ministries ; however , expansion must be carefully planned so the ministry does not find itself over-burdened with real estate and expenses . While churches have found new ways to expand , it is important to plan carefully and consult with necessary experts so the church does not take on any undue risk that could impact their ability to serve their communities . While we don ’ t know what the future holds , one thing remains true : the Church body is resilient . And while real estate is certainly a key component of ministry , influencing lives for Christ is at the heart of what we aim to do .
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