Highlighting more from our podcast series we created to commemorate The McKnight Group’s fifty years of church building and design, we look more in-depth at some of the ups and downs throughout our history. In our last post, we shared excerpts from the podcast entitled “Tough Times,” which addressed the interest rate spike that occurred during the early years of the company. In this post, we’ll look at more recent challenges, including the impact that COVID-19 is still having on church design and building projects across America.
The Impact of the 2008 Recession on Church Building Projects
The early 2000s were incredibly good years for The McKnight Group. In founder Homer McKnight’s words, “We were at our peak as a company. We were doing about 25 churches a year.” At that time, Homer was also beginning to transition leadership to his son, David McKnight, and Philip Tipton.
Then disaster struck. As Homer put it, “In one fell swoop, with the financial crisis that ended in the collapse of the banks, we did not sign another church loan for almost three years.” Many churches had to pause their church design processes. Fortunately, there were enough church building projects in the pipeline that The McKnight Group had work on the table, but they worked at a declining level over those three years. The future was suddenly very uncertain.
Shifting to Church Design and Remodeling Projects
The longer-term impacts of the 2008 recession also changed church design and building in broader ways. As Philip Tipton points out, “churches really stopped building in a significant way. They did continue to commission church design during that time. We had a lot of churches that were still dreaming, and planning, and putting thoughts together about what they wanted to do when they were able.” Churches also became much more hesitant to go into significant debt to finance a new church building.
This was also the time when denominational funding became critically important. The Dodd-Frank Act reconfigured how churches are appraised. This made it much more difficult to get traditional bank loans for the true cost of a new church design. As a result, more church leaders are turning to remodeling their church building or designing additions to meet the needs of an updated church vision. Churches are also moving into vacated existing buildings, such as bankrupt big box stores, office buildings, and even other churches that have closed down, rather than designing a new church building from scratch. (Listen to the podcast to hear one story of a church that was able to purchase 20 acres and multiple buildings of existing space for $5 a square foot!)
Keeping the Faith During COVID-19
The McKnight Group did of course recover from those challenging recession years, but more recently, COVID-19 has proved challenging for the church design and building process. Again, some churches are pausing their church design and building projects. Others are proceeding with church building projects in order to be prepared for when people can worship together again in person.
The podcast details what thriving churches are doing right now – seeking answers. “Certainly, churches that have been prepared to reach their community outside of the church building walls or use their buildings for tools to serve their community, have a leg up. They’re more used to and already have programs and ways into their community to serve and help those communities.”
Obviously, reaching their church communities through existing church building technology is a big factor also. When we started doing our free i3 webinars to help church leaders plan their church design and building projects, we didn’t have COVID-19 in mind. But it’s good to know we can still support churches in thinking about their buildings as a tool for ministry during these tough times.
We invite you to listen to the entire “Tough Times” episode to hear more about how The McKnight Group and its leadership have kept the faith during challenging periods of our 50-year history.