What can you buy with $7 in 2022? You could buy one to two gallons of regular gas, depending on the part of the country you are located in. For about $7, you could get away with one pound of ground sirloin from your local grocery store. You could even order a latte from Starbucks or a number one combo meal from Chick-fil-A — with an upsized drink (half-and-half tea with light ice for me).
Ok, you get the point. Seven dollars can buy us some things, but it sure isn’t a lot. Our money does not go as far as it did a couple of years ago. In the paragraphs below, we are not going to talk about inflation or why costs have increased. Nor are we going to pontificate on the world stage and current events of 2022.
Instead, we want to re-emphasize what it means to be a facility steward, especially in a world where prices constantly change.
Facility Stewards With $7 In Their Pockets
So, with that in mind, what can you get for $7? You can heat and cool one square foot of your facility annually. Janitorial and housekeeping also cost about $7 per square foot annually, along with general maintenance and facility upkeep.
That is pretty scant.
If you have read The 4 Buckets of Church Facility Budgeting or our blogs on what it really costs to own a facility, you know we believe churches need to budget around $7 per square foot annually to pay for efficient and effective facility operations.
In addition, you should have $2-3 per square foot annually for capital reserves, assuming you have no deferred maintenance. If you have deferred maintenance, you need a separate line item to eradicate that as well.
In a recent article by ICMA regarding houses of worship, statements were made that resonate with our team. The article focused on the redevelopment of houses of worship. To get to their point about redeveloping opportunities for churches (like we did for SouthPark Church in Charlotte), ICMA broke down the cost of operations for commercial real estate. Remember that a church facility is a complex commercial facility, not a house.
The article included the following (bold and underline text done by me):
“A second reason is the increasing costs of managing real estate, especially aging real estate. According to the Building Owners and Managers Association, it costs $12 per square foot, not including property taxes, to operate an office building; $2 per square foot to operate a warehouse building. If one assumes that a church is akin to a building that is half-office, half-warehouse, it would cost $7 per square foot, not including property taxes, to operate a church. That would mean a modestly sized 10,000-square-foot church building would cost $70,000 per year, roughly the equivalent of 100 members placing a $20 bill in the collection plate 35 weeks per year, just to support the cost of the real estate, never mind compensation for the pastor or organist or other expenses. The median size congregation of one denomination in one state I am familiar with was 49.”
While I may not agree that a church is half office and half warehouse, I think ICMA makes a compelling point. Given that most sanctuaries, worship centers, gymnasiums, and the like are far more expensive to operate than a warehouse, the $7 per square foot might even be low.
Operational Costs for Your Ministry
There is no need to debate the comparison of churches to offices and warehouses. There is, however, a real need to make sure we really understand the cost to operate our ministry facilities. If you are not spending close to $7 per square foot to operate the facility…plus…capital reserves….plus…a deferred maintenance allocation (assuming you have deferred maintenance, which 99.9% of all the churches we serve do), then you are under-funding your facility operations.
Time to have a reality check and determine if you are headed for a cliff. What you don’t know can hurt you, and our team can help. Our Facility Condition Assessments will provide you with the needed data to be an intentional facility steward. So, don't wait — get a free quote today.