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.