A church for $50k. Is it a good investment?

[Jean G.]

Hello,

I came across this listing while searching for REO properties: http://www.oreoproperties.net/property/view/185.ht...

It's a 4000 sf church located in Baton Rouge Louisiana, for sale for $50k. The property is already under contract (not to me) so the deal is moot, but for educational purpose, I was wondering:

How would someone go about analyzing something like this? It's not a residential, office, or retail building, for which rent/sf and various metrics apply. Not being from the area, how would one determine the likelihood of a congregation renting this property, and how much rent they might pay? I'm assuming that once you had a congregation as tenant, it would be a pretty stable tenant?

Does one simply apply the same metrics as for a shopping center or an office building? It seems to me that the market for church renters is a lot smaller than general retail or business, so how would one make a decision about whether this is a good or not so good investment?

I'm just interested in learning some new valuation techniques, so I know what to do the next time I find a church for sale that's not already under contract...

Thank you!

Jean