“houses of worship are subject to the same laws of economics as secular real estate”

That’s a direct quote from an NPR article about church foreclosures in the States.

For Dan Burr, the road to losing his church last year began with the greatest of hopes. Twelve years ago, Burr and his wife started to worship with a few friends in their son’s house in Fontana, Calif., a community about 80 miles East of Los Angeles. Neighbors began to come to the service. They brought their kids.

“And it began to grow, and before we knew it we had a little viable church,” Burr recalls.

Eventually Crossroads Community Church bought a building of its own — a dilapidated Boy’s Club that church members fixed up themselves. Those were the glory days. Fontana was one of the fastest growing cities in the country, church attendance was booming and Burr began to make big plans.

Their dreams clashed with the reality of job loss and financial strains not long after, as several of their members found themselves without work and without money to feed their own families, let alone Crossroads’ coffer.

Chris Macke, a senior strategist at CoStar Group, has looked into the rising number of church forclosures. He’s seen that churches (and other businesses for that matter) tend to assume good times will keep on rolling and make grandiose future plans that inevitably flop when the other shoe drops.

What made the problem more acute this time, says Scott Rolfs at Ziegler, an investment banking firm that does church financing, was the easy credit in the mid-2000s.

“There was a lot of money out there,” he says, “and just as some home borrowers obtained mortgages that they probably shouldn’t have gotten and wouldn’t have qualified for under historical standards, you had a few churches with some overzealous lenders that ended up in that situation as well.”

That’s not to say churches are going the way of the dodo. There are at least 300,000 other places of worship across the US, according to the article. The dodo just lost a few feathers off a wing or something, but they’ll grow back – other people will be able to buy those foreclosed churches on the cheap and start new ones.


edit 6:27 am — just found an article from the Ottawa Citizen: Churches Gambling with Real Estate.

Do faith organizations have a responsibility to ensure the future use of their property reflects their core values? Does it matter if Canadian Tire builds in God’s vacated backyard?

Indeed, for a religious order committed to vows of poverty, is it not somewhat jarring to enter into the shark tank of multi-million-dollar real estate deals?

Soeurs de la Visitation, an enclave nuns used for at least a hundred years has been sold to developers for $12 million. Other nun-owned property near Ottawa might be sold in the near future.

The early planning is looking at as many as 1,300 homes, divided between townhouses and apartments. Retail and commercial would be worked into what is being called a “model” community.

In this case, the Oblates are reportedly keen to work with planners to ensure they end up both with good neighbours and a design that doesn’t clash with their values, however that is interpreted.

Thoughts?

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