Before getting serious about developing a multi-tenant facility, it’s important to determine if your group or organization has the internal capacity to take on such a complex and time-consuming project. The first question to ask, though, should be: Will this project, if successful, advance my organization’s mission sufficiently to justify the major commitment of time and money required?
The idea for a multi-tenant center may have come from a board member, the executive director or another staff member, or external stakeholders. Regardless of its origin, I encourage you to spend the time up front to be as clear and specific as possible about the mission of the project. Only after you’ve done that can you determine if that purpose closely matches the overall organizational mission, whether it would be a stretch, or if it would be a distraction from your core mission.
For Third Sector New England, which has a broad capacity-building purpose and a focus on social change, the mission of the NonProfit Center – to provide stable, affordable rents, foster collaboration, and raise the visibility of Boston-based nonprofits working for social change – is a strong fit with our overall purposes.
Make Sure You Have a Clear Vision
Even if your group was formed for the sole purpose of developing a multi-tenant center, beware the trap of mission haziness. It seems a no-brainer that co-locating a group of like-minded nonprofits will result in good things. But that general concept is not the same thing as a mission upon which to build a nonprofit center.
Further clarification and a sharper focus will help you avoid later realizing that every stakeholder in the project has a different idea of what the purpose of the facility is and what outcomes are desired. It’s easy to get so caught up in the brilliance of your concept that you are blinded by the light.
Be Sure to Examine Your Internal Capacity
If your project passes the mission test, the next set of readiness questions revolves around competencies and capacity:
- Is your financial position strong? Have you done a risk analysis?
- Does the project have an internal champion with the time, the competency, the commitment and the necessary clout to see it through, given that it’s likely to have a lengthy gestation period?
- Have you documented a need for such a facility in your area?
- Have you considered the opportunity cost of devoting so much time and focus to this project? What won’t you be doing that you might have done otherwise? What might you have to stop doing?
- Do you have or can you acquire, directly or via consultants, the expertise in non-profit law, real estate development, financing and architecture/space planning needed for this kind of complex project? Do you even know what kind of expertise is needed?
- Even if you have an attorney, architect, or real estate professional on your board, don’t assume those people have the right kind of experience or the amount of time required (which will almost certainly be far more than you expect).
- And beware of potential board member conflicts of interest, which are subject to increasing IRS scrutiny. Ideally, you’ll assemble a team of people who’ve worked successfully on similar projects in the past.
- Have you organized support from the local community, including nonprofits, foundations and civic leaders?
- Have you thought about and planned for the impact the project will have on your organization, financially, strategically and morale-wise? Change inevitably causes anxiety among staff and it takes time to process, so be prepared!
- Do you intend to manage the property directly or hire a property management firm? Have you explored the pros and cons of those alternatives?
At TSNE, with the help of an outside consultant, we asked ourselves many of these questions in the late 1990s – and concluded rather quickly that we didn’t have the capacity to take on a project of this scope. What changed our minds was the serendipitous convergence of two events in spring 2001. We’d just filled a new position of program developer, and we heard about the first-ever multi-tenant nonprofit center conference, held in San Francisco in May of that year under the auspices of the Tides Foundation.
Putting It Together
Our new staff member and I went to that watershed event and came home filled with enthusiasm and optimism that we could actually make it happen. We now knew where to start, what kind of expertise we needed to gather, and where to go for help as the project developed.
That doesn’t mean everything went smoothly, but less than 3 years later, we’d acquired our wonderful building in downtown Boston. Just 6 months after that we opened the NonProfit Center.
Still, there were many ups and downs along the way, several of which could have dealt a fatal blow to the project if we hadn’t lined up internal and external support and assembled a top-notch team of savvy consultants and advisors.
Multi-tenant centers are a great concept for community-building, but before you embark on your great adventure, spend the time to cement a strong foundation, both in your community and your new building.
In the ED Forum, TSNE’s Executive Director Jonathan Spack reflects on issues facing non-profit organizations. He invites your response to his columns. Follow Jonathan on Twitter @JonathanSpack.