2 Church Growth Trust

2

Church Growth Trust

1. Who are we and what do we do? Church Growth Trust’s vision is to safeguard independent church properties for future Gospel use. We are also passionate about making sure the buildings are as good as they can be for modern church use. The best way to do this is by both supporting and guiding occupiers of our buildings in their use of the buildings and by working closely with them when they want to improve a building to make it better fitted for its Gospel use. There is no “one size fits all” approach. Each project is unique in content. However, we have an approach which has been tried and tested over a number of years. This helps both parties to keep on track from start to finish and to know what is happening through the day to day life of the project. What follows is hopefully a helpful explanation of a building project when working with us.

2. Ownership – “Explain how the building ownership works” Church Growth Trust owns its buildings, either as a freeholder or as a sole trustee. Essentially this means that the Trust is in control of the property and that when looking at a project the tenant/occupier needs to understand that at no point can the Trust grant any interest in its property other than a tenancy. There can be no sharing of equity where a church owns a share in the property.

3. Funding and gifts for the project – “How are we going to pay for this?” Church Growth Trust understands the issue of ownership and equity can be a difficult message to share with a fellowship AND then to expect generous financial support for a project. Church members often expect to see something tangible

and of value as a result of giving money to a project. It is something they can see and show others. This aspect can be harder still when the owner appears, to the outsider, to be having its building enhanced at someone else’s expense and that rent may also be paid by the church on top. Paying a rent seems to be almost adding insult to injury. This arrangement does not have a modern equivalent in the “normal” property arena and can be a hard concept to grasp even for experienced property professionals.

However, Church Growth Trust does not treat property in the way that other property organisations do. All its properties have been gifted to it because the previous owners saw Church Growth Trust as trustworthy and reliable long-term stewards in the care of their independent church properties. This is the perspective that each tenant/ occupier needs to take when planning a building project. Both parties want the same thing: for the Gospel to be proclaimed now and in the future from a building in its best possible shape to do so. This is achieved by combining those gifts that God has given each party, including people to pray, church leaders and the body of believers to reach the local community, a building, finance, and technical skills.

Both the church and Church Growth Trust are standing on the shoulders of generations of generous faithful servants of God as we come together to build upon their legacy. We pray that this can be grasped early on in a project, as it will strengthen the co-operation and focus of the parties as the project moves forward.

Church Growth Trust recognises financial contributions that you make to improve the property. We normally do this by giving a proportionate rent reduction in order to buy back the value of the improvement. It is important to remember three things at this point:

• Not all works to a building are “improvements”. For example, changing a carpet due to wear and tear is not an improvement.

Equally, changing a stainless steel sink for an enamel sink is not an

improvement or a wear and tear replacement. It is simply a choice based on taste and this does not create additional value.

• The value of an “improvement” is the increase in value of the property, not the cost of the works. For example, if new UPVC double glazed windows were fitted to replace single glazed metal windows, the cost may have been £8,000, but the increased value to the property may only be £2,000.

• You will not be paying a full market rent, as Church Growth Trust always lets its buildings to churches at a discount. At most you will be paying 50% of market value, so some of the value (of the improvements) to be bought back will be reflected by the discount that we are already giving. For example, if you are already receiving a rent concession of £6,000 per year below the market rent, the value of the new windows mentioned above could be purchased as part of the one year’s rent concession.

4. How long can we have on our lease? Church Growth Trust’s normal policy is to grant five-year tenancies, which allow us and you to review the letting arrangements regularly. The five-year tenancies are normally renewed. Where you have invested substantially in the property and want a longer-term commitment (and where the value of the improvements need to be purchased over a longer period), we would be willing to grant a longer lease. Sometimes where grant funding has been obtained, the grant funder may require a longer lease to be in place (e.g. funders will often ask for a minimum of 10 years). Our policy is to grant a maximum of 20 years on a lease. Normally a 10-year lease or longer would only be granted if a minimum of £50,000 had been spent by the church.

Leases for seven years or longer need to be registered with the Land Registry. For this and other reasons longer leases are drawn up by our solicitors (shorter leases are produced in-house at no cost). The cost of drawing up the lease will normally be charged to the church.