It has not been a good era for mega churches.
The economic downturn has hit everyone hard, including the mega churches and their celebrity ministers.
Now comes word that the Crystal Cathedral has been sold.
According to todays LOS ANGELES TIMES . ..
Crystal Cathedral Ministries’ church and campus will be sold to Orange County developer
The properties will be sold to Greenlaw Partners of Newport Beach for $46 million. The church will lease back the landmark venue in hopes of continuing to use it for its ‘Hour of Power’ broadcasts.
By Nicole Santa Cruz and Carol J. Williams, Los Angeles Times May 28, 2011
Crystal Cathedral Ministries’ church and 40-acre campus will be sold to an Orange County real estate developer for $46 million but leased back by the church in hopes of recovering the landmark venue for its “Hour of Power” broadcasts, federal bankruptcy court filings disclosed Friday.
Greenlaw Partners of Newport Beach will lease the cathedral and other core elements of the property to the church administration for $212,000 a month and guarantee exclusive lease rights for 15 years, according to the Chapter 11 exit plan filed in Santa Ana.
The successors to founder Robert H. Schuller also retain the option of buying it back for $30 million within the next four years, although a major financial turnaround in the church’s fortunes would be necessary to afford repurchase. For the four months ending in April, the church’s net loss was $1.14 million.
In creditor filings prior to Friday’s reorganization plan, it was reported that the Crystal Cathedral is “greatly exceeding” budgeted expenses and that the church would have burned through the $2 million it had on hand in operating revenue over the last six months if not for federal bankruptcy protections.
The indebted church hierarchy also will sell a condominium it owns in Laguna Beach that was valued in the reorganization plan at $999,000.
The ministries’ plan for exiting bankruptcy, which lawyers said could be confirmed as soon as Aug. 15, listed six classes of “unimpaired” creditors to be paid from the sales proceeds, with the county tax authorities designated as the first priority followed by Farmers & Merchants Bank, which holds a $36-million mortgage on the ministries’ real estate.
More than 550 creditors were included in the filings, but only a handful were designated as eligible for full repayment.
A reorganized ministries leadership will be led by CEO Chief Executive Sheila Schuller Coleman, the founder’s daughter, whose salary will be set at just under $70,000 a year. The church will also hire a chief financial officer whose salary will be capped at $300,000 a year and tasked with overseeing revitalization of the church’s revenues. In the six months prior to April 30, donations and support decreased by $4.6 million over the same period a year earlier, the filings reported.
Crystal Cathedral filed for bankruptcy protection in October, saying it owed creditors more than $50 million.
The Crystal Cathedral Web site attempted to put a positive spin on the dire news.
Crystal Cathedral Announces Plan to Emerge From Chapter 11, Renewed Focus on Missions
With thanks to the generous response from its worldwide network of supporters, as well as a partnership with a real estate investment group, Crystal Cathedral Ministries has put forth a plan to emerge from Chapter 11 bankruptcy that ensures continued ministry while immediately eliminating both its mortgage entirely and the majority of its vendor debt. Any remaining vendor debt will be repaid over the next 42 months.
Under this plan, the ministry of the Crystal Cathedral will continue its local worship services and community outreach programs. Crystal Cathedral’s weekly Hour of Power broadcast, now in its fifth decade of airings, will carry on uninterrupted as well. In summary, the plan includes a sale of the campus to a real estate investment group with a guaranteed 15-year leaseback, and an exclusive 4-year, fixed price buyback option on the core Church campus.
Because honoring its vendor debt has been a guiding objective for the church’s leadership, the ministry has chosen this course of action over other proposals it considered since this plan repays the vendors the quickest while continuing the ministry uninterrupted. “We are pleased that we are able to honor the debt that we have incurred and to honor the creditors who are due their payment. We are thankful to the vendors for their patience and we are so sorry for any pain that they have incurred. To pay them back 100% has always been a top priority and we are grateful to God for providing the resources to be able to do just that,” says Pastor Sheila Schuller Coleman. “The Crystal Cathedral Ministries would like to thank our church members and friends around the world who have given from their hearts to help rebuild a solid foundation from which we can continue our ministry and launch the new vision for the Crystal Cathedral Ministries.”
The plan also puts the Crystal Cathedral church and ministries on solid financial footing to launch forward with a bold new vision from Pastor Sheila to be a hands-on outreach of hope for both the local and global community, including feeding the hungry, clothing the homeless, providing resources for job searches, and so much more. We need to rise up and be the hands of Christ to help a hurting world one neighborhood at a time. Reaching future generations with the positive message of Jesus Christ requires an outreach of love. I’m excited about what God is doing now and will be doing in the future through the Crystal Cathedral Ministries.”
It is a sad day for millions of people who were inspired and uplifted by Robert H. Schuller’s ministry at the Crystal Cathedral. It is a sad day for Robert and Arvella Schuller who have watched their feuding [and some might say spoiled] kids destroy the ministry they built. Yes, it has been a rough time financially, but as Schuller senior always preached, “Tough times never last: tough people do!” Without the family squabbling, money-grabbing by family and insiders, and downright fiscal irresponsibility, maybe . .. possibly! . . . the ministry could have survived. Schuller [senior, of course!] always said that leadership was looking down the road, anticipating challenges and possibilities that others hadn’t yet conceived. Too bad Bob didn’t learn from similar church/family dynasties and their feuds and see the problem long before it happened.
And it’s a sad day in the 383-year history of the Reformed Church in America. It’s a dire day for the Classis of California and Particular Synod of The West who all along have abdicated leadership, responsibly, stewardship and governance of the ministry of the Crystal Cathedral.