The NonProfit Times - January 1, 2008 - (Page 21)

STREETSMART NONPROFIT MANAGER THOMAS A. MCLAUGHLIN Opportunity Is Knocking Here’s a sub-prime path for the future F ile this tidbit in the back of your mind and be ready to pull it out sometime during the next few months.The misery index is rising, which means that opportunity for streetsmart managers is likewise rising. It’s not the increase in social needs that comes from the combination of increasing unemployment and inflation (the so-called misery index). Although it’s true that many nonprofits experience an ascent in demand for services when the misery index goes up, that’s a perverse definition of opportunity, not the kind being discussed here. This is about the possibility of acquiring real estate at below-market prices. The convergence of predatory lending practices and high bank debt is creating conditions ripe for streetsmart nonprofit managers to position their organizations well for the future. The failure in the sub-prime mortgage market is by now well-understood, but its ramifications are just beginning to be known. Regardless of how widespread the damage might be in pinch a real estate owner feels when their economics suddenly go sour. MOTEL FOR SALE the future -- and at press time there were indications that the problem will expand -- there are almost certain to be opportunities for the shrewd nonprofit manager. Here are three stories that best illustrate the nature of the opportunity. These are different enough situations encountered by real nonprofits that readers are likely to see one or more in their own settings. All three stories have one common thread, smart nonprofit managers recognized an opportunity to solidify and advance organizational mission at a less than expected cost. All of the cases deal with “distressed properties,” a phrase that sounds like it originated in a time when people swooned and had the vapors, but which really just refers to the During the late 1980s and early 1990s, savings and loans institutions (S&Ls) ran into serious financial trouble and dumped the equivalent in today’s dollars of over $20 billion worth of real estate onto the market. These assets were previously owned by former borrowers who could no longer afford them when the economy went bad, and an S&L was holding them when it went bankrupt itself. A medium-sized nonprofit serving disabled individuals bought a threebuilding motel from the Resolution Trust Corporation (RTC), which was the entity set up by the federal government for the purpose of getting distressed properties back onto the marketplace and from there into private hands. It took two of the buildings out of the motel business by converting one for use as a program site and the second for use as their administrative headquarters. It left the Streetsmart, page 22 Exceed your expectations, AccuFund. Award winning financial management software for your non-profit organization. • Extensive reporting financial, grant, client & management • Staff’s choice for ease-of-use • Complete selection of fully integrated modules • Low total cost of ownership select Learn more at www.AccuFund.com AccuFund, Inc. I 877-872-2228 I Sales@accufund.com JANUARY 1, 2008 THE NONPROFIT TIMES www.nptimes.com 21 http://www.runwalkride.com http://www.runwalkride.com http://www.AccuFund.com http://www.AccuFund.com http://www.nptimes.com

Table of Contents Feed for the Digital Edition of The NonProfit Times - January 1, 2008

The NonProfit Times - January 1, 2008 Expenses Continue To Put Stress On Nonprofit Budgets Insuring Donors’ Goodwill Volunteers On Firing Line Contents Who...When...Where...How...What? Red Cross Audit Comes Up Clean Exit Doors Rear And Aft Calendar A Fresh Look Special Report: Accounting APIs Opportunity Is Knocking Middle Management Barrier Memorial NPT Jobs Resource Directory

The NonProfit Times - January 1, 2008

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