4 Replies to “Why are the Humanists selling their building?”

  1. I am going to speculate. But there has been a recent phenomenon of small organizations selling their real estate to augment their flagging endowments. I know a Swedenborgian Church which is doing this, and Meadville/Lombard is attempting to do this.

    I think over the long term the strategy is penny wise and pound foolish. It takes property owned outright, and gives the organization a long term rental burden. Renting offers flexibility, but leaves you very vulnerable to upswings in rental prices (especially if you have a commitment to staying in the same community).

    If the size of the real estate is the issue, then a better option is to downsize to a smaller real estate holding. Profits from the sale of the larger property can be banked as contingency fund for property maintenance.

  2. Derek wrote:
    -snip-
    I am going to speculate. But there has been a recent phenomenon of small organizations selling their real estate to augment their flagging endowments. I know a Swedenborgian Church which is doing this, and Meadville/Lombard is attempting to do this.

    I think over the long term the strategy is penny wise and pound foolish. It takes property owned outright, and gives the organization a long term rental burden. Renting offers flexibility, but leaves you very vulnerable to upswings in rental prices (especially if you have a commitment to staying in the same community).

    Derek,

    It might make sense if they are relocating to a real estate market that is cheaper than downtown Washington DC.

    Now if they’re staying in DC but moving from owning to renting, then this decision doesn’t make sense.

  3. Bill – Very true! There is a cost to owning, especially when repairs have been deferred, or when the property is too large for the economic scale of the organization.

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