Sunday, June 14
10:30 a.m.
Following the Worship Gathering
PROPOSED LAND SALE AND DEVELOPMENT
The church is proposing to enter into a contract to sell approximately 6.2 acres of our current 15-acre campus.
Over the past decade, ACC has experienced declining membership and giving, creating increasing pressure on our operating budget and our ability to maintain our facilities. While we have continued supporting ministry operations and meeting our mortgage obligations, we have not adequately funded long-term building maintenance reserves.
A recent facilities assessment commissioned by the Building Committee identified approximately $3 million in anticipated repair and replacement needs for short-lived building components such as roofing, HVAC systems, plumbing fixtures, and flooring. Of that amount, approximately $1 million represents deferred maintenance requiring immediate attention.
The proposed sale price for the property is $3.48 million. After closing costs, ACC expects net proceeds of approximately $3.27 million. Those funds would first be used to retire the church’s remaining mortgage balance of approximately $1.3 million. Remaining proceeds would be directed toward deferred maintenance and rebuilding the reserve fund. Eliminating the mortgage would also allow ACC to redirect approximately $150,000 annually toward future building maintenance and capital needs. The Leadership Team believes this would significantly improve the church’s long-term financial stability and ability to sustain ministry in our current facility.
LEARN MORE
The Arvada Covenant Church Leadership Team invites you to attend one of the informational Town Hall Meetings. These gatherings are intended to help prepare for the June 28 congregational meeting, where members will vote on whether to approve the proposed sale.
Thursday, June 18
10 a.m.
During Senior Coffee
FREQUENTLY ASKED QUESTIONS
The church is proposing entering into a contract to sell approximately 6.2 acres of our current 15-acre campus. The purchase contract is very nearly fully negotiated, and we expect to have the final version prepared prior to June 14.
The buyer, Folsom Capital Group, LLC (or approved assigns), intends to build a residential townhome community consisting of up to 90 for-lease units. This development will be consistent with the conceptual site plans, layout, and architectural renderings currently being shared with the congregation. To help visualize the project, there are stakes placed on the land that approximate the location of the corners of the buildings that correspond to the site plan.
The purchase price is $3,480,000, which is equal to our full asking list price. The buyer is proposing to construct high-quality, build-to-rent townhomes. Upon contract signing, the buyer will have 15–18 months to complete architectural planning, due diligence, and obtain the necessary municipal approvals from the City of Arvada and the Colorado Department of Transportation.
A formal Broker Opinion of Value completed by our marketing agent, CBRE, in October 2023 established a market value range of $2,790,000 to $3,480,000.
The Property Task Force (PTF) engaged CBRE in early 2024 to broadly expose the property to the competitive market, allowing us to thoroughly evaluate a wide variety of potential uses and buyers.
The process generated interest from primarily townhome developers, but we received interest and proposals/offers regarding senior living, market rate apartments, workforce housing, hotel, and recreational uses (see table below). The Task Force evaluated opportunities based on multiple factors:
The PTF believes the current contract at $3,480,000 is the result of full exposure to the marketplace and it is a market rate and termed offer.
Folsom Capital Group, LLC is the entity that submitted the offer. Our primary point of contact has been Chris White, an experienced residential developer with a background in housing and development projects. The buying entity will be a newly formed, special-purpose entity created specifically for the development of the project, involving Chris White as the principal developer, with financial backing and oversight by the capital partner.
Equally important, the church required the involvement of a major institutional development and capital partner. That partner is anticipated to be RangeWater Real Estate (or an equivalent institutional partner acceptable to the church). RangeWater Real Estate is a nationally recognized multifamily development and property management firm founded in 2006. Publicly available information indicates the company has developed or acquired more than 35,000 residential units and manages approximately 100,000 housing units across multiple states, representing more than $6 billion of real estate. A strong capital partner’s mandated participation provides institutional oversight, significant development expertise, capital market credibility, and confidence regarding execution and financial capability throughout the projected 15–18 month process. Moreover, the offer price was most competitive.
As we have shared previously, commercial land transactions take a significant amount of time. The contract defines the explicit stages as follows:
It is possible that the initial Inspection Period could be extended for a sufficient reason, and it’s unknown if the Extension Option will be required. The schedule reflects a potential closing date between 16 and 17.5 months after contract signing, which is typical for transactions of this nature
Although the buyer is responsible for managing the development process, the church has agreed to cooperate in several reasonable ways during the contract period. These include:
- Entitlement Cooperation: The church will cooperate with the buyer as it pursues required city approvals for the proposed project.
- Design Coordination: The church has agreed to the preliminary site plan and design concepts shared to date. If material changes become necessary due to city requirements or engineering issues, those changes will remain subject to the church’s reasonable review and approval rights.
- Replating and Parcel Creation: The church and buyer will work together to formally subdivide the property into separate legal parcels through a replating process.
- Shared Use Agreements: The parties will negotiate and finalize several long-term operating agreements, including (i) a Joint Use and Maintenance Agreement (JUMA) governing shared items such as driveways, drainage, utilities, and maintenance responsibilities; and (ii) a Memorandum of Restrictions intended to ensure the development remains compatible with church operations and the surrounding community.
As with any commercial development transaction, several factors outside either party’s direct control could impact the project including:
- Governmental Approval Risk: The City of Arvada could deny or materially modify required approvals or entitlements for the proposed development.
- Moratoriums or Infrastructure Constraints: New restrictions involving utilities, water, drainage, traffic, or building activity could materially impact the feasibility or timing of the project.
- Unresolved Agreement Items: The parties must still finalize certain shared-use and operational agreements, including the JUMA and restriction documents.
- Environmental or Site Conditions: Unexpected environmental, soils, drainage, or infrastructure issues discovered during testing could impact development feasibility.
- Market and Financing Conditions: Broader economic conditions, financing markets, construction costs, or capital availability could also affect the project timeline or viability.