The IKE Box building, on the corner of Cottage Street and Chemeketa Street, was used as a funeral home for decades before being transformed into a coffee shop. (Rachel Alexander/Salem Reporter)

Salem’s IKE Box won’t be moving after all.

The coffee shop, housed in a century-old building that once served as a funeral home, now plans to buy the property it currently leases from Salem’s YMCA, which is undergoing a demolition and rebuild starting later this summer.

It’s part of a deal between three downtown Salem entities that have been in talks for months: First Presbyterian Church, the YMCA, and Isaac’s Room, a nonprofit serving youth that owns IKE Box.

The three came together in an effort to preserve IKE Box’s historic building in a way that would allow the YMCA to expand as planned.

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An earlier plan called for the IKE Box building to be moved across the street onto First Presbyterian land at a cost of about $1.5 million. Now, the church plans to sell that land to the YMCA to build an affordable housing project for veterans, a joint statement released Monday from all three groups said.

“Mark (Bulgin) and I both wish this whole deal would’ve happened six months ago,” said YMCA CEO Sam Carroll, referring to the director of Isaac’s Room. “It’s a win-win-win.”

The new plan is possible thanks to $5 million in state funds that Senate President Peter Courtney, D-Salem, secured for the YMCA’s veterans housing project.

Previously, the YMCA’s building plans called for IKE Box to be demolished so the YMCA could use the property for an affordable housing project.

In March, YMCA and IKE Box leaders announced the Y had agreed to donate the building to Isaac’s Room, the nonprofit organization that owns the coffee shop, if they could find a way to move it to new land.

Isaac’s Room directors Mark and Tiffany Bulgin, along with Carroll, kicked off a $1.5 million campaign in May to raise funds to move the building. The Bulgins said they’d reached an agreement with First Presbyterian to site the coffee shop on the corner of Cottage and Court streets and enter a long-term lease with the church.

At the time, the church’s strategic plan meant a sale of that land wasn’t feasible.

But after further discussions, church leadership decided a sale could work.

“We hope this is the beginning of other partnerships for restorative and reconciling opportunities!” said First Presbyterian lead pastor Del Burnett in a statement.

Demolition of the old Salem YMCA will begin in September. (Rachel Alexander/Salem Reporter)

Under the new plan, Isaac’s Room would raise funds to buy the lot the IKE Box sits on from the YMCA and stay in place. The YMCA would then buy the corner lot from First Presbyterian to build their apartment complex for veterans.

The YMCA has long provided housing in addition to running a gym. Courtney famously lived at the Y when he first came to Salem in 1969, and the nonprofit has until recently leased apartments in an aging building next door to the fitness center for $400 a month.

That apartment building will come down as part of a rebuild of the fitness center, which has become increasingly costly to operate thanks to outdated heating and cooling systems, a leaking roof and other problems.

“I wanted housing to be part of the rehabilitation of the Y because I lived at the Y for two years and if it hadn't been for that, I wouldn’t be talking to you today,” Courtney said.

He secured $4 million in lottery bonds and $1 million for the Oregon Department of Veterans Affairs for the housing project to go forward.

“This is a bold move being made and it changes everything,” Courtney said.

Leaders from all three organizations will hold a community meeting at IKE Box on July 25th to explain the plan and answer questions.

Losing the IKE Box land would change YMCA construction plans slightly, Carroll said, but the fitness center should be able to go forward with the change.

Many of the details, including sale prices and a timeline, are still being worked out. The YMCA board voted July 9 to move forward with the land sales.

Carroll said YMCA board members are currently talking with local veterans groups about how best to move forward with the project, but they’re tentatively planning to build 40 to 50 apartments and focus on women veterans, a group with few current affordable housing options.

Correction: This article originally misstated the date when the YMCA board voted to move forward with land sales.

Reporter Rachel Alexander: rachel@salemreporter.com or 503-575-1241.