December 14, 2000 | Read Time: 3 minutes
By DEBRA E. BLUM
A tight real-estate market is driving up costs for nonprofit groups across the country, but some charities that own property are benefiting from the high prices.
The Vera Institute of Justice, a New York research and advocacy group that works on
issues related to the judicial system, for instance, has profited from the spiraling Manhattan market.
Earlier this year, the institute sold its offices, located in an old building in lower Manhattan, days after putting the 22,000 square feet of space on the market. The buyer paid nearly $4-million for the offices, which the institute bought in 1984 for $1-million and fixed up for another $1-million.
The group is using the interest from the proceeds of the sale to rent larger space in the landmark Woolworth Building, which is located on the northern edge of the Wall Street business district.
Christopher E. Stone, Vera’s president, says that the group had so outgrown its old offices that some of its 85 employees were sitting at desks placed in conference rooms or hallways.
“We either had to lease more space, buy more space, or move altogether,” he says. “The strength of the market demonstrated that selling and moving made the most sense. We were able to move to a much higher-grade office building, in a better location, in a space even bigger than our needs are right now.”
Like the Vera Institute of Justice, Seattle Goodwill Industries has capitalized on the strong real-estate market.
Goodwill had owned the seven acres on which its facilities sit since 1930, and the building from which it operated was constructed in 1946. Improving and expanding the old facility would have cost millions of dollars — too much, the group’s leaders say, for a charity with no endowment and little fund-raising experience.
But the land Goodwill owned had become valuable real estate in a city whose economy has been propelled skyward by the growth of the high-technology industry.
The charity was getting calls from developers and others who wanted to buy the land. But Goodwill officials had decided that the organization needed to stay put so that it would be convenient for the people who come to its job-training programs and thrift shop.
Ultimately, a Seattle developer found a way to meet the charity’s needs. Wright Runstad & Company agreed to renovate and expand Goodwill’s facilities — a project expected to cost at least $8-million — in exchange for about 3.5 acres of Goodwill’s land. Wright Runstad plans to build three office buildings on its newly acquired property.
Jill Jones, Goodwill’s president, says the reason for the land-for-renovation swap was to secure bigger and better space for the charity’s operations. But, she says, the deal could have other benefits, too. The office buildings are expected to be occupied by technology workers, who Ms. Jones hopes will help Goodwill train people for careers in the computer field.
Ms. Jones sees another potential advantage to having new neighbors. “We’ll have 2,000 people next door who will probably become our donors, volunteers, shoppers, and patrons of our cafe,” she says.
