Church saves on new space

Lifepointe Church in Raleigh started looking for a permanent location for its congregation five years ago.

Founded in 2004 in a movie theater on Six Forks Road, the nondenominational Christian church has grown quickly.

Today it includes more than 800 members who attend Sunday services at Durant Middle School in North Raleigh and at a satellite facility on Western Boulevard in West Raleigh.

In September, the church will begin offering Sunday services downtown at the Lincoln Theatre.

Five years ago, Lifepointe had the same problem many growing churches had. It couldn't find a suitable property in its price range because of all the competition from developers.

Now that's all changed.

"We went from having no options to having many options over the last year," said Donnie Williams, 44, the church's lead pastor. "We had decided to stop looking and just be portable, and then all of a sudden, many options came our way."

Late last month, the church paid $1.2 million for a 5-acre tract on Durant Road that includes a 20,000-square-foot manufacturing facility. The seller was Duraw Manufacturing, an electronics components maker that went out of business.

Later this summer, Lifepointe expects to close on an adjacent 10-acre parcel now owned by Luck Stone, a Richmond, Va.-based company that produces crushed stone for new residential and commercial construction.

Luck Stone paid nearly $2 million for the property in May 2007. It's listed for sale at just under $1.5 million.

The church plans to build on the land. Phase one involves gutting and renovating the manufacturing facility, which is expected to begin hosting services in early May.

"It saved us, probably at least a million dollars over anything comparable we would have bought five years ago," Williams said.

Thriving nonprofits likeLifepointe have been among the major beneficiaries of the economic downturn, which has drastically reduced demand for all types of real estate.

Some are simply leasing vacant industrial or retail space. Many are using the depressed market as an opportunity to become property owners.

Some examples:

Holy Trinity Church, a 6-year-old congregation, paid $695,000 in September for a 1.5-acre parcel in downtown Raleigh that fronts Peace Street.

The Summit Church, a fast-growing Baptist congregation in Durham, paid $9.5 million for 23 acres near Miami Boulevard and Alexander Drive.

Raleigh Charter High School, one of the nation's top-ranked public high schools, paid $6.375 million for the United Methodist Office Building at 1307 Glenwood Ave. in Raleigh.

And Vintage 21 Church has under contract an 8-acre tract on New Bern Avenue just east of downtown that is currently owned by the Raleigh Rescue Mission. The church expects to close on the property this fall.

Nonprofits are financing these purchases in a variety of ways. Summit sold bonds. Holy Trinity paid cash.

Lifepointe borrowed $2.55 million from Christian Financial Resources, a Florida nonprofit that provides lending and investment advice to churches and other religious organizations.

The church also recently took ownership of the building on Western Boulevard where it holds services. The property, which was a donation from Capital City Church, is 90 percent paid for.

"We were able to do this because, No. 1, the price we were paying put together with our cash flow, which is really good," Williams said. "Our cash flow is surprisingly increasing.

"At a time when everything else is decreasing, our offerings are going up."