It's taking more than faith for one church to keep its building on track
The parishioners of St. John the Baptist Episcopal Church in Capitola are often asked why they would leave a cute little redwood chapel within an enclave of foliage that gives a visitor the feel of being in a forested mountain top monastery. The answer has become a mantra: the church simply cannot grow on the land allotted. Adjacent plots haven’t been on the market for decades, and even that would not solve the atrocious parking problem. Yet despite the seasoned automatic responses, when faced with the question of how they are going to leave a cute little redwood chapel—by means of a three-phase multimillion dollar building project during a time when banks have an insatiable need for foreclose—the answer is much more complicated.
A pas de deux of luck and goodwill seems to be part of the winning combination. St. John’s was able to beat the rise in housing costs during the late ‘90s by purchasing a plot of land off of Seacliff Drive in Aptos in November 1992, then, by the skin of its teeth, selling the Capitola property ahead of the current slump in April 2006.
But St. John’s couldn’t move fast enough on constructing a new building, and unfortunately was forced to stay past the date when the titles were due to be transferred. The woman who bought the property had no connection to the church other than a friend or two in the congregation, however she was “more than willing to let us stay in the property at a very minimal rent,” said Mary-Nona Hudson, the treasurer for St. John’s. Still awestruck with the new owner Hudson described her as “like an angel.”
Anne Baker, the chair of the building committee, knows that aside from lucky breaks, it took perseverance and dedication to get this project off its feet. Numerous capital campaigns have brought in money; pledged donations have risen during the past five years and deceased members have bequeathed money to help the development. Phase one will cost approximately $7 million. In order to get the loans needed, Hudson estimated “about 20 parishioners” had to guarantee the bank that, “if the church can’t pay the parishioners will.” That’s not an easy decision to make when statistics from hotpads.com, a site that maps housing trends, has the foreclosure rate in Aptos at 1 in 300 homes, and Capitola at 1 in 600.
In fact, Hudson continued, “It hasn’t been as we have just zipped through it.” Despite the generosity of the congregation, there have been lots of rocky times with the bank that may not have happened five years ago. The original bank, Coast Commercial Bank, was bought out by Wells Fargo. Although extremely helpful with the inherited project, the large national bank was not about to jeopardize its own capital and have a PR nightmare because they foreclosed on a church. As a result, the hoop jumping has been tedious. Aside from the parishioners’ promissory notes, the bank required numerous financial statements, a complete pay off of previous loans in order to obtain the construction loan, and weekly conference calls to make sure everything is going according to plan.
The city has also proved to be a constant source of hoops. Because the project is considered commercial, St. John’s had to cut back some, but not all, of its green building plans, and instead purchase tens of thousands of dollars worth of commercial kitchen appliances to properly meet building codes.
As far as construction, Anne Baker put it frankly, “No matter how much you get for your current property, construction costs rise every minute.” Claims from XL Construction , the company building for the church, state that “in comparison with the housing industry, the commercial building industry has been surprisingly steadier.” However the steady market does not necessarily reduce the unforeseen factor of construction costs. According to enr.com, a website that tracks the economics of the construction trade, the Building Cost Index is up 6.4 percent year-to-date. The materials used for building has an index that skyrocketed 10.3 percent on the year. These numbers have not been good news for the parishioners of St. John’s.
But despite the obstacles, halting construction was never an option. “We don’t build a church more than once every hundred years,” says Baker. “Once you sell something, you’re committed. Maybe we had to downsize, but we still have to build it.” Although an anomaly within the current financial situation, St. John’s successes may be better attributed to a philosophy than a lucky move during a peak market. Anne Baker’s advice for successful building: “Be really clear on what purpose you are trying to serve with your project. You don’t just build for building’s sake. You constantly clarify your vision, if you clarify your purpose.” And that purpose with an unyielding vision may very well answer the “how” question.
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