With a $350,000 balloon mortgage payment approaching in February, The Center (The Gay, Lesbian & Bisexual Community Center of Central Florida) is refinancing, restructuring and rethinking fundraising.
The Center has been in operation for more than three decades, and is an organizing force within the LGBT community. It is also a source for information, education, advocacy and support, and offers programs ranging from business referrals to free HIV testing.
In 1999, the Center created a for-profit corporation titled The Orlando Center, Inc. (OCI), to facilitate purchase of the building that continues to be The Center’s headquarters, as well as two adjacent buildings: a Chinese restaurant and a pharmacy. The rent on the adjacent buildings has paid the mortgage for all three since purchase. OCI is governed by a five-person board consisting of four volunteer members and The Center’s president.
“My understanding is that OCI was formed to alleviate the tax burden from collecting rent from the other two buildings,” said current Center executive director Michael Vance.
Barry Miller, the first president of OCI, said that in addition to running the business operations of the buildings—collecting rent, securing insurance and paying taxes—OCI was intended to serve a philanthropic purpose.
“OCI was the actual owner, and it was supposed to have a fundraiser every year to dissolve the debt and wipe out the mortgage,” Miller said. “That never happened.”
OCI transferred ownership of The Center’s headquarters to GLBCC in 2001, but remains the owner of record for the other properties. But with the balloon payment looming, OCI may dissolve. The four OCI board members—Elliot Barber, Chris Alexander-Manly, Linda “P” Putkovic and Shawn Rader—have already stepped down.
“We recommended their attorney handle the transfer of our corporate assets to The Center and dissolve our corporation,” said Barber. “This is what [The Center] wanted; we’re just doing what they wanted us to do.”
That attorney is John Ruffier, who said the specifics of that transfer are still being considered.
“I’m working with the folks at OCI, and we may not dissolve OCI. Over the years, the control of the properties moved over to the GLBCC Board, and they can handle both,” said Ruffier. “OCI is owned by the Center. If we dissolve OCI, we’ll transfer the buildings to the Center. If we don’t dissolve, OCI will still own them.”
Ruffier said since The Center is OCI’s sole shareholder, the corporation itself can continue to exist, even without the board members.
“Nothing will change,” confirmed Vance.
These transitions are all happening ahead of that looming balloon payment, due in February. Barber, who was OCI’s treasurer when he served on that Board, said the Center is paying off two mortgages—a bank-held mortgage that’s been steadily paid down to $14,000 from about $50,000, and a larger privately-held mortgage that requires the $350,000 payment in four months. The plan is to refinance ahead of that February due date. The Center is confident that refinancing will be approved.
“[Not being able to refinance] is unlikely because the property values are high, and it’s income-producing with stable tenants,” said Ruffier.
According to public records, the current assessed values of the adjacent buildings are $250,306 and $248,017, and the current assessed value of The Center headquarters building is $289,758.
“I don’t believe we are in any danger of losing the building,” said Vance.
In the meantime, Vance and The Center board are taking steps to ensure future financial stability. On July 6 they launched a drive to secure pledges that will produce $5,000 per month for the organization.
“For thirty years The Center has been supported by our members and individual donors,” Vance said. “We want to make sure we’re here another thirty years, and the pledge campaign is the direction we’re going.”
Vance said the timing of the fundraiser is unrelated to the refinancing.
“Having the pledges will make us look better to the bank, but it’s not required for the loan,” he said. “The goal is for The Center to be self-sustaining, and to own the building free and clear.”
