Two years ago, William Podlich had the idea that a bunch of Orange County nonprofits could do better under one roof than on their own.
Today the retired, former chief executive of Newport Beach’s Pacific Investment Management Co. is signing up tenants at The Village at 17th in Santa Ana, a 35,000-square-foot office center for nonprofits.
The center is the result of Podlich rethinking his philanthropy strategy, he said.
“For 20 years, I’ve been on this board and that board,” Podlich said. “I decided that for the next few years I’m going to emphasize things that hold out the promise of benefiting a lot of organizations from the effort that goes into one organization.”
The Village seeks to do that by offering nonprofits a place where they can find reasonable lease rates, share some office services and pick up some intangible benefits from clustering together.
The building can house about 20 nonprofits. A handful of tenants have moved in so far. Rents are set at the low end of the market rate and stay relatively stable over time, helping nonprofits with their long-term budgeting.
Nonprofits also can cut office costs by sharing equipment, a conference room, a training room for 40 people and a front desk.
The $3.5 million project includes offices facing a courtyard and ranging from 460 square feet to 3,000 square feet.
There’s about 2,500 square feet of common space—a point of design intended to encourage collaboration, Podlich said.
“That’s the kind of shared space we’re trying to create in the long run,” he said. “Hopefully, they’ll give each other good ideas.”
The building’s about a quarter full now with tenants including Mercy House, Campfire USA Orange County Council and Olin Group, which helps nonprofits with fundraising, marketing and other needs.
Warren Lortie, a retired real estate executive and Podlich’s partner on the project, expects the building to be full in six months to a year.
The goal is for the center to be self-supporting with the rents paying for the mortgage and other costs, Lortie said.
Other backers include the Newport Beach-based Orange County Community Foundation, which provided a $500,000 loan and hosts Orange County Shared Spaces Foundation, which is Podlich’s umbrella nonprofit.
Podlich got started on The Village with a call to Shelley Hoss, president of the Orange County Community Foundation, which helps wealthy donors with giving.
Podlich had been serving on the foundation’s board.
The foundation helped him put together a steering committee to work out a business plan for The Village.
“A big part of our role is to explore and put into action visions that donors have for the community,” Hoss said.
Improvements are under way at The Village and are expected to be done by early next year.
“We have enough equity that we were able to close and move forward with our tenant improvements,” Podlich said.
He said he intends to do more fund raising. He’d like to raise another $300,000 to $500,000, Podlich said.
To find and acquire the building, Podlich enlisted Lortie, a real estate investor who founded WLA Investments in Newport Beach.
Lortie, who sold his company and retired in 2004, had been doing a lot of golfing when he got a call from Hoss.
“She put me together with Bill, who had a dream,” Lortie said. “When I got there it was, ‘How do I take the dream and make it happen?’”
Podlich invited Lortie to a “shared spaces” seminar in San Francisco, which has one of the largest office centers for nonprofits, the Thoreau Center for Sustainability.
Lortie decided that he’d help out—a little. His duties since have expanded. He’s become the boots-on-the-ground guy.
That’s the nature of working with a nonprofit, Lortie said. It starts out as a meeting and ends up evolving into more. But he said it’s been a good partnership.
“Bill has resources in fundraising and the administrative side that I don’t have,” Lortie said. “I have resources in the construction industry. Between the two of us it’s been a great team.”
There have been plenty of challenges.
“We’ve had real heart to hearts,” Lortie said of meetings with Podlich. “We’ve had to confront a lot of issues to get here.”
The project has taken longer and cost more than originally planned, according to Lortie, who’s doing some things he’d hoped to leave behind in his retirement.
“I spent my day at the building department yesterday,” he said.
It’s also a tough time to lure tenants because many nonprofits don’t have the means to move and continue to benefit from relatively cheap rents.
But in better times, nonprofits with tight budgets face a tough time finding offices, Lortie said.
“They are tolerated in downtimes when landlords will take anybody,” he said.
With the local economy improving, landlords could seek higher rents from nonprofits. That should make it easier for The Village to fill its space, according to the backers.
Marketing for the center has been low key so far.
“We’re primarily relying on word of mouth,” said Podlich, who hopes to attract a diverse group of nonprofits from the arts, human services and others.
“We are pretty open-minded about the kinds of tenants,” he said. “In fact we think the collaboration, the sharing and the networking between the employees, will work better if it’s a cross-section of nonprofits.”
The Village is just the start, according to Podlich.
Eventually, he said he’d like to open other office centers for nonprofits as well as satellite neighborhood service centers.
