USCJ Sells Manhattan Headquarters To Stem Red Ink
Facing a continuing financial crunch, Conservative Judaism’s congregational arm plans to soon sell its two-story Manhattan headquarters.
The proposed sale, announced January 20, would mark the second time the United Synagogue of Conservative Judaism has sold its offices in less than a decade. In the meantime, the group has suffered years of financial crises from which it is still struggling to recover.
In an email to stakeholders, the group said it had signed a contract to sell its two-story Manhattan headquarters for $15.9 million. The sale is contingent on approval by USCJ’s more than 600-member congregations, which will vote online in February and March.
“We want to be able to position our balance sheet and our assets to work more for our congregations,” said Rabbi Steve Wernick, the group’s CEO. “We think if we create a supporting foundation and retire some debt [with the proceeds of the sale] we’ll be in a stronger financial position.”
USCJ has been fighting for its financial footing for years. When Wernick became the group’s CEO in 2009, one of his first acts was to cut the organization’s staff by 10% as a cost-saving measure. At the end of USCJ’s 2014 fiscal year in June, the organization’s auditor reported that its net assets had declined by $1.2 million that year. In 2013, USCJ’s net assets declined by $3.3 million. At a board meeting last September, Wernick asked for board members to spread their annual gifts over the course of the year to help the organization with cash flow issues.
The latest sale effort was the result of a proposal by the Studley Group, real estate advisers secured by USCJ. At a meeting June 8, the board approved a resolution to put the two floors it owns at 820 Second Avenue on the market.
New York State charity law mandates approval of the sale by USCJ’s membership before it takes place. USCJ’s letter says that details about the voting process will be announced in early February.
The Conservative congregational group has owned the Second Avenue offices since only 2007. That year, the group sold a building at 155 Fifth Avenue for $26.5 million and bought the offices at 820 Second Avenue for “less than $15 million,” according to contemporary board meeting minutes.
Wernick criticized his predecessor’s decision to purchase the Second Avenue offices. “I’m not sure, if I were at the United Synagogue [at the time], having sold those assets, that I would have invested in more real estate necessarily,” he said.
In a statement in late 2006, USCJ said that the revenue from the sale of the Fifth Avenue offices would be put into a “restricted account” for “extraordinary expenses.” Wernick said that some of those assets had been used to “finance the turnaround that we’ve done.”
USCJ plans to lease new space in Downtown Manhattan once the sale of the Second Avenue offices goes through. It plans to place most of the proceeds from the new sale in a new restricted endowment.
Contact Josh Nathan-Kazis at email@example.com or on Twitter, @joshnathankazis