A construction comeback!

Time — and, of course, the Great Recession — have altered the ways church building campaigns are done. Here, several stewardship experts weigh in.

By RaeAnn Slaybaugh

levelRSI Stewardship Senior Vice President Morgan Boardman, CFRE, and his team felt the Great Recession firsthand — and adjusted accordingly.

Between 2008 and 2011, in the midst of the recession, his firm’s construction campaigns fell from 74 percent of the business (2004-2007) to 61 percent. During this same period, RSI’s debt campaigns grew to represent 28 percent of the business, compared to just 16 percent from 2004 to 2007.

Then, from 2012 and 2014, RSI saw a rebound in construction campaigns: 67 percent. Simultaneously, demand for debt reduction campaigns decreased to 20 percent. Given these figures*, a rebound in church construction campaigns is clear.

Meanwhile, at The Charis Group, most (if not all) of the firm’s campaigns were for debt reduction after the crash of 2008, according to President Mark Brooks. “Churches either couldn’t get loans for new construction, or they simply put it off given the economic climate,” he explains. “That has changed, especially in the last year.”

Today, Brooks estimates 70 percent of his firm’s campaigns are for some type of construction. “There’s a feeling that — although our economy is still not 100-percent back — we’re nonetheless in a better position.”

Chuck Klein, president of Impact Stewardship Resources, Inc., has experienced a similar bounce-back. Immediately following the economic meltdown of 2008 and 2009, as much as 80 percent of the campaigns his firm led were for debt retirement. “A lot of people had balloon notes and excessive debt, so campaigns were a necessity.”

Now — thanks to a more reliable economy — about 75 percent of the campaigns he and his team lead are for new construction. “Churches went into a wait-and-see mode,” he recalls. “Many put off construction for as much as six years.”

Some things change …

imsis800-052Now that construction campaigns are back on the radar, it’s a good time to evaluate how they’ve adapted — not only post-Recession, but over the past few decades. For example …

The “right time” might not be obvious. Joel Mikell, president of RSI Stewardship, points out that some of his firm’s most successful giving campaigns were conducted between 2009 and 2011, in the midst of the Recession. To this end, he cautions church leaders against waiting for “a better time” to start a campaign.

“There will always be reasons to wait,” he acknowledges. “However, if the project is ‘right vision’-driven, God will provide the resources. Resources follow vision.”

The cost of construction is managed better, now. Mikell says debt avoidance is a driving factor in today’s church construction campaign. “There will always be an element of faith and trust when it comes to church finances,” he acknowledges. “But the hard lessons learned in 2008, 2009 and 2010 have not been forgotten.”

Consultants are more behind-the-scenes. According to Paul Gage, president of The Gage Group, the role of a capital campaign consultant is far less visible to the church body than it once was.

“Today, campaigns are designed for the senior pastor to be most visible person to lead church in prayer, presentations and preaching,” he explains. And in larger churches, church staff — not laypeople — are taking on key campaign positions, Gage adds.

Technology and social media are on the scene. For Brooks, technology is the most prominent change affecting today’s church construction campaigns. “We’re now a smartphone-driven society,” he points out. “Givers want to know, ‘Can I make a pledge to your capital campaign on my smartphone?’”

Even so, in Klein’s experience, few church leaders take full advantage of social media in a campaign context. That’s why his team began several years ago to make the web, Facebook and Twitter a centerpiece of its campaign communication strategies. “Now, mobile technology is huge,” he adds. “You can reach your people with a simple mission / vision message with a click of a button.”

Churches are seeking and embracing new capital funding strategies. According to Gage, capital campaigns have primarily been associated with larger building projects; however, with the five-year slowdown in new construction, churches are looking for alternative approaches to raise funds. “We’re experiencing more one- and two-year giving programs with the focus on bundling smaller expansion projects, with local and global compassion initiatives,” he explains. “Instead of using the term ‘capital campaign,’ churches have embraced newer branding, such as Generosity Initiatives and Heart for the Kingdom.

Some things stay the same …

While stewardship experts have adjusted their approaches accordingly over the past few decades, they agree some tried-and-true drivers of construction campaign success remain — regardless of what’s happening with the economy or technology.

A clear purpose. “The vision and purpose for the project should be focused on ministry impact and life change as opposed to bricks and mortar,” Mikell explains. “The call to give is more about investing in people than in a campaign goal.”

Brooks echoes this sentiment. In his experience, the most successful construction campaigns link the project back to the church’s vision. To this end, he says a church executive must always be prepared to answer two questions at the forefront of donors’ minds: the “heart question” — Does this project make sense? — and the “head question”: Can you pull it off?

“They’re asking what your plans are,” he explains. “They want to know those plans are well-thought-out and won’t harm the missions and ministry budgets of the church.”

A well-informed — and united — church body. Though it can be difficult to measure such intangibles as these, Gage has a benchmark in mind: when 70 percent of qualified church donors make a financial commitment to the campaign. “This will position the church to achieve its spiritual and financial goals,” he says.

To ensure these levels of buy-in, Brooks says time is of the essence. “The best campaigns are those that start early and stay on task through the end.”

A diversified communication strategy. For Mikell, including all demographics in the campaign experience has proven very successful. “Different age groups consume information differently,” he says. “There can be no-one-size-fits-all.”

Generally, he says, older church members still want something they can hold in their hands and read. Younger members will want campaign information primarily in a digital format.

Despite differing delivery mechanisms, he urges church executives to follow up and create a conversation with these groups. “Once information has been communicated, people of all ages will want an opportunity to interact and give their feedback.”

Large gifts make a large impact — but church-wide engagement is critical. Experts agree that large-lead gifts will comprise a substantial portion of the campaign gifts. To this end, engaging financial leaders requires church executives to addressing this group’s unique questions and insights.

“In the local church, people with resources want to give — and give generously — to the vision, especially if the focus is on life change and ministry impact,” Mikell says. “However, neither a colorful communication piece nor a beautifully designed website will be enough to inspire them to invest significantly. They respond best to a meaningful conversation.”

Yet, as Klein points out, this is just one aspect of a healthy construction campaign. “A successful campaign needs to maximize key donor potential and engage, inform and challenge the entire church,” he advises. “Gone are the days of just reaching out to a handful of key supporters or making a simple broad sweeping appeal to everyone.”

Results still matter! Gage asserts that with new construction on the rise, capital campaigns are “without question the most effective approach to raising maximum funds.” Although generosity initiatives and capital campaigns are organized the same way, he says, the goals and financial results are different.

“When a major building project is introduced, a church will raise more money,” he explains. “For decades, churches have communicated vision, ministry impact and change lives; however, when a campaign is connected to a new building project, we see larger gifts and better participation, resulting in more money for buildings and ministry.”

*The balance of these figures (2004-2014) is represented by capital campaigns for renovation projects.
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