Has anybody ever used an MFR as an investment for their church?

[Charlie MacPherson]

The church where I've been a member for the last 10 years is trying to recruit a new pastor, as our previous pastor moved back to his home state after 9 years with us.  Like many churches, our congregation is both aging and dying off.

As I'm serving on the Call Committee, it has become obvious that we simply cannot afford a full time pastor as things now stand.  A big part of the reason is that the town where the church is located is a top-tier town in coastal MA.  The average sale price of a 3 bed home there is almost $530,000.

Thinking out of the box, I wondered whether we could buy a 4-plex in a nearby (less expensive) town.  Pastor lives rent free in one unit, 3 others generate income.

Use a property manager to handle the hard bits like evictions, rent collections, maintenance, landscaping, etc.

3 of the 4 units are no longer tax exempt, but so what?  We'll pay those taxes.

So yes, there are speed bumps to overcome, but when aren't there?

If you've ever considered something like this for your non-profit or church, I'd love to chat with you.

[Mike Cumbie]

Hi @Charlie MacPherson,

I do not have any experience so take my concerns with a grain of salt. I have been a board member at several places and understand the way management by committee ends up working out.

In theory i would agree with the premise. You have a 4 unit, your pastor stays in one and the other 3 are rented out. The extra money covers the 1 unit and maintenance and a few extra bucks flow into the coffers or it's a break even and that is still OK because it covers the one big expense.

My concerns are that once there is a problem with any member of the church (Mary is abused and needs a place to stay, The Smith's are kicked out of their house, Fred is in the hospital and it is closer to stay at the 4 unit place during care) the apartments become extra "free/low cost" rooms for use. Once that happens now instead of paying for 1 unit you end up subsidizing the cost of 2 or 3. Your neutral to positive cash flow is now negative cash flow. I just feel that once you have apartments someone will find a reason that it would be perfect to use. Which becomes a cost vs a benefit.

Just my 2 cents and Good Luck in whatever you decide to do!