One of the most important decisions in the life of a church is knowing when to move into permanent space, and maybe more importantly, how to move into permanent space. We have seen so many fast-growing churches see a shift in their culture from reaching people to paying bills, and it almost always comes back to the multimillion-dollar decisions made over permanent space. So, in this article, we are going to focus on when to move from portable to permanent environments, and how to do it. 

The Benefits of Portable Space 

Portable space is not a bad thing. In fact, it’s a great thing when it comes to building the culture of your church. Every client we have helped move from portable to permanent space has had the same lament after the move: “we lost something about our identity”. Being in portable space is the absolute best time to engage people in the mission of the church. There are more service opportunities in portable space than there are in permanent space, which provides more people an opportunity to be a part of the story and not feel like a product of the story. 

Flexibility 

The most valuable commodity in the life of a growing church is the ability to pivot. Flexibility is everything. Larry Osborne has said, “you have to have an exit plan that is as strong as your implementation plan.” When you’re in portable space, you can pivot more easily with locations, staff hires, programs, and the like. As Jim Collins would say,  this helps you shoot musket shots before you line up the cannons. 

Portable space provides you with the opportunity to innovate and iterate, to see what is working and who is working. Once you get into permanent space, it gets harder to move walls and spaces. 

Why move to permanent space?

Site control. My mentor, who has been very successful as a real estate developer here in Atlanta, told me that while location is the number one rule of real estate, site control is easily number two. The obvious problem with portable space is a lack of control of what happens and when. If a law changes or a new principal comes into a school, they have the right to ask you to leave, or take over space on certain Sundays, which is detrimental to a church who is looking to create a consistent experience and impact. This leaves you with weeks, months, or even a year to find a new, comparable space in the area where your current congregation lives. 

The second reason to move into permanent space is growth. In certain markets (i.e. South Florida and the Northeast) some people have said that people don’t consider you a “real” church until you have your own space. But the bigger reason is simply experience, specifically with young families. We live in a time where kids are bringing parents to church. What I mean by that is that we as a whole we as a Church taught and even rewarded people sitting at home and watching our services online during the pandemic. So what is the number one reason that parents get off the couch and come to church to hear the same sermon in person they could listen to online at their convenience? When their kids are excited about going to church. 

We have consistently seen churches and campuses with 25% of their attendance in kids bump to 30% to 35% as soon as that church moves into a permanent space, which of course also creates an enormous amount of growth in adult attendance. Parents want safe, dedicated, transparent, and fun space to put their kids while they are in service, and that is much more easily accomplished in a permanent space. 

So when do you know it’s the right time?

There are both qualitative and quantitative answers to this question. When we are working with churches, the starting point to answer this question is a reframing of the objective:

When it comes to church real estate, we are not funding buildings. We are funding ministry capacity. 

Our two rules for funding ministry capacity are this: 

1. We can afford this today even if we never add another person 
2. We are creating enough capacity where the capacity we are potentially creating pays for itself. 

If you have not maxed out your capacity in seats, parking spots, and kids within at least two services, I would recommend staying portable. However, if you are feeling cramped in your space and feel that you have completely maxed out your potential, then here are some things to think about. 

Funding Model 

We hosted an event with the CFO of Chick-fil-A, and I will never forget something he said: 

"Without margin, there is no mission” 

One of the keys to going permanent is being sure that finances are a servant to the ministry and not its master. We strive to help churches get to a point where their campus(es) create a self-funding model, where the church moves from an externally funded model (capital campaigns and debt) to an internally funded model (self-sustaining campuses). We do that by evaluating the financial model in three tiers: 

• L1: Supported (a campus supported by a broadcast or L3 campus)
• L2: Sustaining (a campus that pays its own bills and share of central expenses) 
• L3: Supporting (a campus with surplus to support future L1’s) 

The most important question in this model is whether or not you can move from portable to permanent and get to an L2 status in two services, whether you are evaluating a campus or your first permanent location. The third service and beyond are what create the surplus for future growth, but should never be necessary for simply paying the bills. If that is not the case, then a permanent location becomes a short term solution with long term problems. 

When you have enough margin in your budget to fund your future mortgage payments

One of the biggest….. No, wait…. The absolute biggest deterrent for churches being able to move into permanent space is that they are not budgeting for that permanent space now. 

You know you are ready to move into permanent space when you have already demonstrated the financial means necessary to do so. In short, if you are only creating $100,000 in margin and need a $200,000 annualized debt payment, you are not ready. Begin budgeting for permanent space 2-3 years before you are ready for it. 

When you are turning people away 

We, as a Church, are not in the real estate business. We are in the business of introducing people to a growing relationship with Jesus Christ. Real estate is simply a tool we use to accomplish that mission. 

One of the major benefits of filling up the portable space you are in before jumping into permanent space is that when you cast the vision for needing more room, no one is going to argue with you. Side benefit, it helps a lot with fundraising. 

My advice would be to not consider moving into permanent space until you add a third service in portable space because you feel like you are having to turn new people away, whether it’s due to seats in worship, childrens’ ministry, or parking. If you have not yet reached that point, grow where you are. 

When the clarity of your strategy is defining your opportunities 

One of the biggest mistakes we see churches make is allowing for opportunities to define strategies. What do I mean by that? I see a lot of churches see a space pop up and try to figure out how to make it work, versus having a clear picture of affordability, funding, program, location, etc. As an example, we’ve seen so many church mergers where a “free” building (which usually ends in millions of dollars of costs to renovate) put them in a situation where they’ve borrowed a bunch of money for a building that doesn’t work for them. 

It’s extremely important to know the number of seats you need, which affects your children’s ministry spacial requirements and parking, ceiling height, locations, flow, cost to return, debt, etc. so that your strategy is actively qualifying opportunities that arise. Otherwise, you will end up in a building that caps your growth. If you don’t know what you need or how you will pay for it, how do you know whether or not it’s a good opportunity? 

At Ministry Solutions Group, we strive to help churches gain the clarity they need to move forward, and we do so within our Clear Path Forward process. If you and your team are interested in bringing clarity to your strategy of expansion, we would love to have a conversation! Click on the link below and we will get back to you immediately.