Multi-tenant Nonprofit Centers are buildings that house multiple organizations and provide healthy, efficient, quality, mission-enhancing workspace. More than just offices, these facilities can become sustainable centers for strength for communities to dream together, work together, and grow together.

Nonprofit centers come in all shapes and sizes and serve many different kinds of communities. All centers, however, share three basic features:

  • Composed of multiple (2 or more), primarily not-for-profit, tenant organizations
  • Exist as a physical site (one or more buildings)
  • Provide affordable, stable workspace, build capacity for the nonprofit sector, and support the various missions of its tenant organizations.

Why is Space Important to the Nonprofit Sector?

The ability of nonprofits to provide quality affordable social services depends on their ability to develop and maintain crucial infrastructure resources. More than ever, nonprofit organizations find it increasingly difficult to secure and maintain quality workspace that is stable and affordable and also enhances the mission and operations of tenant organizations. Some of the key reasons for this include:

  • Economic Hard Times - Funding from foundations and corporate sponsors has decreased, especially to groups who already tend to receive a smaller portion of the pie, such as those serving immigrants, advocates for social justice, or youth service providers.
  • Lack of Real Estate Focused Support Services and Advocates - There are very few, if any, organizations dedicated explicitly to the office and program space needs of the nonprofit sector. To date, infrastructure support for nonprofits has been focused on management and organizational development, fiscal sponsorship, fund development, and more recently, information technology.

How Do Nonprofit Centers Enhance the Nonprofit Sector?

Collaborative space and shared services help built a thriving and sustainable sector in a number of ways:

  • Increasing visibility
  • Lowering overhead costs
  • Transforming expenses into investments
  • Pioneering new initiatives

They benefit organizational tenants through providing:

  • Stability
  • Affordability
  • Mission enhancement

They strengthen individuals and diverse communities through:

  • Increasing direct program and service delivery
  • Creating new hubs of economic activity
  • Providing community resources

Resources on Making the Case for Nonprofit Centers >

Strategic Considerations

Through our work across the country we have identified six interdependent strategic issues that are important to consider in creating and operating nonprofit centers.

Planning and Feasibility

Vision and Purpose

At the heart of every successful center is a shared identity based on a clearly articulated unifying mission and set of objectives. Once defined, the identity of the center provides the cornerstone for all other strategic decisions about facilities, financing, services, tenants, and governance. Most centers fall under one of these categories:

  • Affordable, stable space
  • Multi service centers
  • Programmatic theme centers
  • Community economic development and/or historic preservation centers
  • Foundation-created centers

Development Process

It all starts with the vision and purpose of your project. Then you move into a parallel process of identifying real estate options, such as development partners and funders as well as governance and ownership options. The key aspect in this stage is to have an agency that takes on the role of keeper of the vision and lead project manager.

Planning and Feasibility Resources >

Ownership and Governance

Strategic decisions made at the Center depends on your ownership and governance structure. Ownership and governance structures vary, depending on various factors:

  • Vision and purpose
  • The level of tenant participation or sense of community
  • Finance

In general, the more cooperative governance approaches tend requires more tenant participation but are more cumbersome and challenging to manage and finance. The more traditional real estate development approach will be more streamlined and efficient but will require more effort to develop a community feeling among the tenants.

Ownership and Governance Resources >

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Financing and Fundraising

Creative, solid financing is one of the key factors in developing a stable center with affordable leases. Things to consider in your financing and fundraising:

Types of Funds Required

There are many different types of funding required to develop and operate a center.

  • The purchase of a building
  • Development and renovation funds
  • Tenant improvements
  • Ongoing building management operations
  • Periodic capital improvements
  • Program and service delivery
Funding Sources

Usually financing a center will require a combination of sources such as:

  • Capital campaigns
  • Traditional bank financing (mortgage)
  • Community loan funds
  • Private loans
  • Program Related Investments (PRIs) from foundations
  • Historic tax credits
  • Tax exempt bonds
  • Organizational reserves

Ongoing financial management considerations:

  • Insurance (liability and property)
  • Accumulating capital reserves for renovations, expansions, tenant improvements, and repairs
  • Staffing costs
  • Loan repayment deadlines
  • Refinancing
  • General/annual maintenance costs
  • Unexpected program or project opportunities
  • Tenant vacancy reserves
  • Rental market fluctuations

Financing and Fundraising Resources >

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Real Estate

The most obvious characteristic of a nonprofit center is the building. Many strategic decisions in this area--such as location, renovations and improvements, space allocation, layout and design--apply to any nonprofit organization.

Key considerations include:

  • Location
  • Buy or lease
  • Rent pricing
  • Renovations
  • Space allocation

Facility issues include:

  • Space layout and design
  • Reception areas
  • Program delivery
  • Shared multipurpose space
  • Exhibit space
  • Tenant services

Real Estate Resources >

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Building Operations

The fundamental business of a nonprofit center is mission-driven property management. Achieving stable, affordable, mission-enhancing space and developing a collaborative community of tenants begins after the trash is taken out, the gutters are cleaned, and the heating/cooling system is operating at maximum efficiency.

Property management issues include:

  • Over extending Your organization
  • Facility operations
  • Staffing and support

Leasing and tenancy issues include:

  • Tenant selection criteria
  • Space
  • Marketing

Building Operations Resources >

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Programs and Services

Creating and supporting the community of organizations that inhabit a center is both rewarding and challenging. There are great opportunities for cooperation, operational cost savings, and synergy as well as headaches trying to broker buying coops, mediate conference room scheduling conflicts, and inspire program participation.

As with all of the other strategic considerations, it is essential to align your menu of shared services with the vision and purpose of your center. For example, if your goal is to create a center with coordinated client services, you will need more hands-on program management to facilitate tenant interaction and shared services than if you are simply providing affordable office space.

Service Philosophy and Delivery Plan

Providing or supporting shared services is not a simple task. There are many options and considerations: 

  • Service philosophy
  • Who provides the services?
  • Extending your boundaries beyond the center
  • How do you pay for these services?

Some typical services nonprofit centers:

Most centers provide some kind of shared facilities and/or enhanced infrastructure:

  • Enhanced space and physical infrastructure
  • Shared multipurpose space
  • Exhibit space and signage

Many centers provide some kind of enhanced communications or programmatic element to their property management role:

  • Communications and outreach:
  • In-person community/professional development

Some centers extend their role into providing or facilitating operational support services such as:

  • Reception and clerical services
  • Integrated staffing services
  • Resource sharing

Programs and Services Resources >