metro

Economic downturn torpedoes
e",Corners,
Temple Shir Shalom's
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nonprofit center.

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the

CORNERS

A CAMPUS FOR CARING COMMUNITIES

The Corners as a multi-tenant space for nonprofit

organizations was the brainchild of Rabbi Dannel

Schwartz. The poor economy led to its failure.

Jackie Headapohl
Special to the Jewish News

"for sale" sign sits in front of
The Corners, an office complex
on Walnut Lake Road in West
Bloomfield. It's no different from hundreds
of other "for sale" signs that sprinkle
Metro Detroit's landscape since the reces-
sion began. This "for sale" sign, however,
signals the failure of a dream launched in
2008 and led by Rabbi Dannel Schwartz of
Temple Shir Shalom in West Bloomfield.
In 2008, Schwartz launched a nonprofit
501(c)(3) — separate from the temple —
called The Corners: A Campus for Caring
Communities. The Corners was to be a
multi-tenant nonprofit center that would
help local nonprofits share costs and lever-
age their resources to better serve the com-
munity.
The nonprofit purchased the build-
ing for $2.5 million in July 2008 from
Congregation Shaarey Zedek. The building
is the former CSZ Irving and Beverly Laker
Education and Youth Complex, where CSZ
held its Sunday school and high school
classes before they were moved to the
Hillel Day School of Metropolitan Detroit
in Farmington Hills. Previously, the build-
ing had been the Walnut Lake Elementary
School.
Schwartz and other investors in the
project didn't foresee the economic collapse
that followed on the heels of The Corners'
September 2008 opening. That month the
U.S. financial system began to unravel lead-
ing to bailouts, layoffs, falling home prices
— in short, the worst U.S. economic crisis
since the Great Depression.
The timing of The Corners led to its
ultimate demise, according to Schwartz. "A

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June 2 • 201

multi-tenant nonprofit center is a proven
business model — in a good economy,' he
said. "Timing is everything, I've learned."
Multi-tenant nonprofit centers allow
nonprofits a cost-efficient way to provide
services by cost-sharing and collaborat-
ing with others in the center. For example,
instead of renting meeting or conference
space 24/7, as in a traditional lease, non-
profits could rent only the space they need-
ed for employees and rent the other space
on an hourly basis as needed.
Michigan has several successful multi-
tenant nonprofit centers in Ann Arbor, Flint
and Detroit; but before The Corners was
launched, none existed in Oakland County.
Schwartz saw an opportunity to serve local
nonprofits as well as the temple, whose
Sunday school and preschool program were
among the first tenants at The Corners.
The plan was that rent dollars from the
temple would be reinvested in The Corners
to help others and the larger community,
what Schwartz refers to as tikkun olam
(repairing the world).
As the recession began to deepen, how-
ever, nonprofits that had originally pledged
their support to The Corners began to
pull back. Potential tenants, such as the
West Bloomfield Parks and Recreation
Department, reduced the space they
planned to lease. Other promised tenants,
such as Madonna University, canceled their
leases completely.
"It was frustrating to
witness what was going
on in the economy, in the
community, in the state
— all these factors out-
side of our control;' said
Andre Douville, executive
Andre Douville director of The Corners

and Temple Shir Shalom. He blames two
factors for the failure of The Corners.
The first was the collapse of the real
estate market. When Schwartz, Douville
and others created the business plan for
The Corners, office space was being leased
for an average of $20-$25 per square foot,
sometimes more. The Corners' business
model would allow nonprofits to lease
only the space they needed on an hourly
basis, saving thousands of dollars annual-
ly on rent. As the recession wore on, how-
ever, many businesses went under, leaving
a glut of vacant office space. That caused
prices to fall by as much as 25 percent.
Some nonprofits chose to renegotiate their
leases instead of move to The Corners.
The second factor was the negative
impact the recession had on nonprofits
in general. "Donations to nonprofits were
on the decline," Douville said. According
to the Association of Fundraising
Professionals, donations to nonprof-
its declined as much as 30 percent.
Nonprofits could no longer count on
wealthy donors to write an annual check
for $100,000. Instead, they were fighting
for their very survival.
"This caused boards of directors to
become very skittish," Douville added.
"They were reluctant to commit to any-
thing new like The Corners."
Schwartz said it became obvious late in
2009 that The Corners would not survive.
"We went to the bank to give them the
keys, but they said no; they wanted to
work with us," he said.
Fifth Third Bank, which held the
loan, worked with The Corners as it
made attempts to find more renters, but
Schwartz said The Corners was stymied by
a lack of marketing dollars.

"It became an impossibility," Schwartz
said. The Corners went into receivership
earlier this year. The bank has the building
up for sale for $2.5 million, the original
price of the building before extensive
renovations were made. The 501(c)(3) will
remain in existence until the building is
sold, Schwartz said.
Temple Shir Shalom maintains a
10-year lease on the space it occupies at
The Corners, as do other tenants of the
building. "That's a plus for the potential
buyer," said Schwartz, who said he still
believes, in the right hands, the business
model will work.
"I'm sad that it didn't succeed:' Schwartz
said. "I feel like I've let the people who
believed in me down."
But the failure of The Corners hasn't
soured the rabbi on future projects that
could help the community.
"I'm an entrepreneur in everything I
do," he said. "When a dream turns to dust,
you vacuum it up and move on. If you
don't keep dreaming, you die."
Temple Shir Shalom was built on a
dream, added Schwartz, who created the
900-family congregation from nothing.
"We were able to create magic by a combi-
nation of skill, luck and timing:' he said.
Timing was what ultimately killed The
Corners; but during its brief existence,
it was able to fulfill its mission of giving
back to the community by providing free
space to organizations such as Alcoholics
Anonymous, Relay for Life and others, said
Douville. He sees the failure of The Corners
as a detour to continuing the temple's mis-
sion to help the greater community.
"All the elements for doing what we
were doing still exist:' he said. "We'll figure
out new ways to do it." I J

