Think selling a home is hard? Try a church, or a bowling alley

Selling a house is hard enough; the difficulty climbs when it's specialized, like a church.
Published December 7 2014
Updated December 8 2014

Real estate broker James Parker is trying to sell a house with some unusual features. There's a pulpit. And an altar. And a room big enough to seat a congregation.

In fact, it does seat a congregation — the 300 members of the Union Street Methodist Church, a Clearwater house of worship that is on the market for $1.68 million.

"We do a lot to help the community, but that costs money and it's hard to do that and maintain a large campus,'' Pastor Nancy Mayeux said. "The church is the people, not the building, so we're going to sell the church and use the proceeds to continue to be missional.''

The church, which comes with a school, small chapel and nearly 5 acres, is what's known in the real estate trade as a "special use'' property. As the name suggests, such properties were designed for highly specialized functions that make them a challenge to unload when it's time to sell.

Consider bowling alleys. They're long, boxy buildings with alleys, gutters, pin-setting equipment, probably a full kitchen and bar. Then consider that not many people bowl anymore.

"If it isn't operating as a bowling alley, I bet it's $200 a square foot to refurbish it into some other use,'' said Ted Hager, a business broker with Coldwell Banker in Tampa.

Why pay that, most buyers would figure, when they could get a smaller, plainer building that could be converted into offices for just $40 a square foot?

Still, Hager managed to sell one Tampa Bay area bowling alley that the new owners turned into an electronics store.

"What made it so advantageous was that it's a great location — it all comes back down to location, location, location — and because bowling alleys often have lots and lots of parking, that was a premium.''

Though Hager quickly found a buyer, many special-use properties languish on the market.

In 2001, as more and more Americans began using mobile phones, R.R. Donnelley closed the 100,000-square-foot plant near downtown St. Petersburg that once printed telephone directories. Part of that cavernous space was converted into storage, but part sat vacant.

Enter commercial real estate broker Derek Keys, who knew that an 18,000-square-foot section of the plant was for sale. He found an ideal buyer — Vertical Ventures, which owns a rock-climbing gym near Tampa International Airport and had spent years looking for a place in Pinellas County to build a much bigger gym.

"Our business has very specific needs,'' co-owner Hal Thureson said. "As far as square footage, we need a large space and we need a good amount of clear internal height. If it's not tall, it's not very impressive.''

Thureson and his two partners, all of whom live in St. Petersburg, wanted to be near downtown because of its "energy'' and the growing legions of athletic young professionals. They were instantly smitten with the Donnelley plant, with its 30-foot ceilings, ample parking and easy access to the interstate.

In August, the partners paid $810,000 for the property off First Avenue S at 18th Street and began a complete gut job. That includes digging down 10 feet in one corner to create climbing walls four stories high.

Now set to open in early spring, "it will be the tallest and biggest (climbing) gym in Florida,'' Thureson said.

It's a short distance from another special-use property that has undergone its own odd series of conversions.

Built in the 1920s, the stately, porticoed building on Second Avenue S originally housed the Palms Funeral Home. In 1987, the owners sold the property to the YWCA Tampa Bay, which used it as an administrative headquarters until two years ago.

That's when real estate investor Trish Moore bought it for $552,600.

"These kinds of buildings just jump off the curb at you, they're so special,'' she said. Within a few months, she had leased it to Rococo, a steak house.

Did the fact that the building once contained corpses give anyone pause? "Heck, no,'' Moore said. "I was just disappointed I didn't see any ghosts.''

Among the less creepy but more common and hard to sell special-use properties are churches. They hit the market with surprising frequency.

"I've handled tons,'' said Hager, the Coldwell agent.

Since the recession, many churches have had to downsize as donations from financially strapped members dry up. But given the design of the standard church — steeple, soaring ceiling, a big sanctuary lined with pews — the most logical buyer is another church. The problem is that to buy Church A, Church B has to prove its members can come up with a substantial part of the purchase price.

"Most banks know that most of these churches are having financial trouble so they're not really happy to lend money,'' Hager said. "Usually most banks want about 65 to 70 percent of those in the church on board in writing that they are willing to bankroll this latest venture.''

That's been the hurdle facing St. Pete Vineyard Church, which had an option to buy space that it now leases at 5000 10th St. N.

The owners '"want $900,000 and it's a little out of our range,'' said Chris Cahall, pastor of the 300-member church. "We don't beat our people up for money, we don't guilt trip them and we don't have any wealthy people in our church.''

In Clearwater, the Faith United Church of Christ sold its building to St. Petersburg College a few years ago when its membership began to drop. The remaining parishioners moved in with Union Street Methodist Church.

Now Union Street is selling, even though its own membership is growing.

"The challenge is that all of our congregations are low-income'' said Mayeux, the pastor. In order for the church to devote more money to programs and less to upkeep, it will lease space at a Methodist church in Dunedin as soon as it finds a buyer for the campus at 1625 Union St. that it has occupied for more than a half century.

Parker, the Colliers International broker handling the sale, said there has been "considerable interest'' from charter schools, congregate care facilities and, of course, other churches. But so far, no takers at the nearly $1.7 million tab.

"This is a pretty big step for some smaller churches,'' Parker noted, "and consequently they have been unable to come to the table with an offer anywhere near that amount.''

Still, Mayeux has faith that a buyer will emerge.

"Then we won't have to worry about the buildings anymore. We'll just pay our rent and continue doing our missional activities.''

Contact Susan Taylor Martin at smartin@tampabay.com or (727) 893-8642. Follow @susanskate.

 
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