Panelists Offer Inside Look at Nonprofit Sector
Nonprofit organizations provide both opportunities and challenges in the commercial real estate industry. Whether it’s finding the best space that leverages a nonprofit’s resources or a building that can meet the unique needs and mission of the organization, CRE members can play an important role in supporting the nonprofit sector.
Members learned more about those opportunities and challenges at the CRE in the Nonprofit Sector
program on Feb. 11. Besides the insights of the panelists, the program provided a firsthand look at the headquarters of Paraquad, which offers services and programs for more than 2,500 people with disabilities.
Ann Schmelzle, a CREW-St. Louis member and Vice President – Commercial Brokerage with Balke Brown Transwestern, moderated the panel discussion.
• Aimee Wehmeier, President and Chief Executive Officer of Paraquad
• Stephen Westbrooks, Executive Director of the Southern Region for IFF
• Randy Winzen, founder of Aligned Studio.
The ability to purchase the building on Oakland Avenue presented great opportunities for Paraquad, Wehmeier noted. It was a chance to design space that was functional, as well as to expand its services. The latter included its Health and Wellness Center with accessible exercise equipment and rehabilitation services.
The building also features Bloom Café, which offers casual dining while also helping people with disabilities grow their independence through a unique job training program. And the new building also generates rental revenue with office space it doesn’t occupy.
But the older building didn’t come without challenges, Wehmeier said. Of course, the HVAC, sprinkler system and plumbing needed major work or replacement. Along the way, elevations throughout the building posed problems, and flooring often had to be completely repaired when concrete simply crumbled. Asbestos was discovered. The added costs of information technology and security also added to the budget.
Those hidden costs were a valuable lesson, as well as understanding that flexibility and strategic partnerships with contractors were essential to persevere, Wehmeier said.
Aligned Studio worked through those challenges, Winzen said.
The Bloom Café was designed to front Highway 64 so diners could also see Forest Park. A terrace surrounds the café so diners can enjoy the outdoors during better weather. Flooring is designed for wheelchairs, along with accessible ramps inside and outside the facility to ensure access.
Additionally, Aligned Studio also outfitted the space for a major tenant that provides rental revenue.
The project needed financing. IFF, a community development financial institution that provides financing and real estate services to nonprofit organizations, helped with a loan and new market tax credits.
IFF isn’t as constrained as a traditional bank or lender, Westbrooks noted. Consequently, it can fund up to 95 percent of the capital needed, with only a 5 percent equity, and the equity can include equipment or in-kind services. It also typically amortizes loans over 15 years to help nonprofits leverage their finances and cash flow.
IFF works with nonprofit organizations and low-income communities throughout the Midwest, generating nearly $1 billion in financing since its inception in 1988. Its services have included more than 33 loans in North St. Louis City, and it is working with the developers on Delmar Devine, Westbrooks said.
Photo Album: CRE in the Non Profit Sector