Churches of different sizes have very different property needs.
Some congregations love and serve their communities with a steeple and pews. Others need kitchen space, classroom space and seating for 800 people. These buildings don’t come off the rack. Finding a space big enough for a large congregation presents unique challenges in the property-buying process — challenges beyond the abilities of most church leadership teams, and many commercial real estate brokers.
Without guidance, large churches can find themselves lost in a complex regulatory process and left behind in a competitive property market. Matters regarding church real estate require a specialized approach that should include an adviser who has both real estate expertise and experience working with churches. While every transaction is unique, here are four tips for large church congregations to position your church for success in the property-buying process.
Investigate Property Zoning
For congregations with average weekend attendance of 1,000 people or more, traditional church buildings are just too small. The only alternative is to find a commercial building and convert it. Not all commercial zones are the same. Some zones are defined broadly and permit public assembly within them. Others are defined narrowly and require a variance from the city, known as a conditional use permit (CUP). If you’ve identified a potential building, investigate city zoning regulations to determine if the property can be used for religious purposes. Receiving approval for a new CUP can take anywhere from three to six months and can cost thousands of dollars in fees. Additionally, it is important to gain a clear understanding of what it will cost to convert the building into a suitable church.
Understand Parking Requirements
No city leader wants to further congest traffic and worsen parking availability. Most commercial properties can’t handle the parking needs of a large church congregation. This poses a challenge. Navigating this challenge requires negotiating off-site parking agreements with the property’s neighbors. This can be a laborious task, as the occupants of the properties are often tenants, and the landlords can be holding companies that are difficult to trace to an actual person. It’s important to secure these agreements as soon as possible. If a church purchases a building and can’t secure enough parking, it will have spent millions on a building that the city won’t permit them to use.
When large churches make offers on large buildings, the bidders they’re competing against are usually for-profit companies, not other churches. This has challenging implications. Normally, a large church has to make an offer contingent on permit approval, and they could potentially need up to five months to close the sale. A for-profit company, however, might need no contingency and can make a firm commitment to close in 30 days. That’s not a competition a church is likely to win. To adapt, churches need to do their homework. Know the objections the city is likely to raise during permitting. Have an engineering and architectural team ready to draw up plans. Have a parking agreement strategy ready to implement. The quicker those things come together, the better the chances of making a deal.
Know When To Ask For Help
Large real estate transactions are high-stakes affairs with a lot of moving parts. It’s a good idea to have an expert to call on for help. But not all experts are created equal. DCG Strategies focuses on the needs of churches and other nonprofits and is uniquely positioned to address the needs a large congregation faces when trying to grow their building, their ministry and their impact on the world around them.
If you are exploring the potential purchase of church property, see how DCG helped Destiny Christian Fellowship purchase a commercial building and convert it to a religious facility. Contact us to learn more.