Facing a decades long decline in membership and a housing affordability crisis in its back yard, Arlington Presbyterian Church made a radical decision.
In 2016, the more-than-century-old congregation sold its parking lot, grounds, and stone sanctuary with a green copper steeple to the Arlington Partnership for Affordable Housing, a nonprofit developer. In its place now stands Gilliam Place, an apartment building with 173 affordable units and a ground-floor space where church congregants now worship.
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Neighbors’ stories guided the church’s radical transformation. As church members rode the bus and spoke with people who worked nearby, they heard a common concern: People were struggling to afford to live there.
“Those stories broke their hearts,” says the Rev. Ashley Goff, who joined as pastor in 2018. “They really felt this call by God to do something very dramatic about the lack of affordable housing.”
Ultimately — after some contentious discussions — the church reached a decision to do its part to help low- and middle-income people acquire housing using the greatest asset it had: valuable real estate.
In 2016 the church sold its land and historic stone building with a green copper steeple to the Arlington Partnership for Affordable Housing, a nonprofit developer, for $8.5 million. The church was razed, and in its place now stands Gilliam Place, a six-story complex with 173 apartments. The building, with ground-floor space that the church rents for worship services, offers homes to people who earn 60 percent or less of the area’s median income.
Hundreds of faith groups are following the same path as Arlington Presbyterian, turning their vacant or lightly used property into homes. For cash-poor congregations that face declining revenue and participation in religious services and rising maintenance costs, developing housing can offer a financial benefit while also expanding their social mission.
Most faiths have teachings about helping the vulnerable, and faith-based organizations have long provided housing in their communities. But it’s rare that religious leaders have real-estate-development expertise and the resources to navigate the often-challenging financial and political barriers that come with planning and building apartments or houses.
Nonprofits and foundations have stepped in to help, and efforts are expanding. Enterprise Community Partners, the Local Initiatives Support Corporation, and other groups provide religious leaders with training, connections to developers and legal advice, and financial support to help them make informed decisions about whether they should use their land for housing and then guide them through the complex development process.
Enterprise, one of the biggest national nonprofits working on housing issues, has run its Faith-Based Development Initiative since 2006. Financial institutions including Capital One and Bank of America, supported the program, and local grant makers such as the Blank Foundation in Atlanta and New York’s Trinity Church Wall Street have also provided support.
In 2022, Wells Fargo gave $8.5 million to help the program expand nationally from the mid-Atlantic region where it began. Houses of worship in Atlanta, Baltimore, Miami, New York, Seattle, and Washington are participating now. Grant makers and local governments have committed roughly $12 million to the program for the next several years.
So far, the effort has created or preserved 1,500 affordable rental apartments in the Baltimore-Washington region. More than 1,000 homes are in various stages of development in other parts of the country, and the potential for more is huge.
“Even if just 10 percent of the faith-owned land got activated tomorrow for affordable housing, we’re talking about potentially hundreds of thousands of units around the country,” says the Rev. David Bowers, an Enterprise vice president, who has led the Faith-Based Development Initiative since its inception.
In the Washington metropolitan area alone, the Urban Institute identified nearly 800 vacant parcels owned by faith-based institutions, most of which are already zoned for residential building. Assuming multifamily housing could be built on that land, it could support the construction of 43,000 to 108,000 new low-cost housing units.
Meanwhile, Local Initiatives Support Corporation, a nonprofit community-development financial institution, is helping churches explore housing projects in New York and the San Francisco Bay area. And Yes in God’s Back Yard, backed by the grant-maker coalition Catalyst of San Diego & Imperial County, has ambitious goals for faith groups in Southern California.
Most faith groups don’t opt to sell their land and tear down their sanctuary space as Arlington Presbyterian did. Rather they want to maintain control of the land over the long term and take better advantage of underused property like parking lots or classrooms.
The decision to raze the Virginia church wasn’t an easy one, says Goff. It created a rift between some members of the congregation, and many decided to leave. But the status quo was simply unsustainable for the 60-person congregation.
Several building residents joined a recent Sunday service as Goff began the way she often does, with a nod to the church’s obligation to its neighbors.
“We are here on the entry level to maintain our commitment to the affordable-housing crisis in Arlington County and to be in community with our neighbors,” she said.
‘Pull You Forward’
Congregations and other faith-based organizations have a long history of filling housing needs in their communities through donations of land, involvement with Habitat for Humanity building projects, and providing shelter for people who are homeless. Many churches in Black neighborhoods have been involved in those efforts, and these congregations are a priority for Enterprise, as they’ve historically had less access to financial resources to support their growth, Bowers says.
Leaders from more than 250 houses of worship across the county have participated in Enterprise training sessions, and Black churches represent around 80 percent. The remaining 20 percent include a mix of predominantly white or culturally mixed churches and a few mosques and synagogues.
“Part of our work is to get more faith communities from all kind of walks involved,” Bowers says. “When you have declining memberships, and you see your building space very underutilized, it becomes pretty stark.”
Enterprise’s training and support for congregations span an array of needs, including:
- Grants to pay for market studies to determine what kind of housing or community spaces are in demand.
- Help to find developers, development consultants, and real-estate lawyers.
- Guidance on working with banks and other lending institutions.
“You’ve got to have these people who pull you forward when there were a lot of other voices telling you that this isn’t going to work,” says Goff, the Arlington pastor. “The number of steps that it takes and the stars that have to align for this to happen are overwhelming.”
Many faith organizations that build housing rely on the Low-Income Housing Tax Credit, the country’s largest affordable-housing subsidy program. But the process of applying for government tax credits can be sluggish, says Monica Ball, who leads community outreach for Yes in God’s Back Yard, or YIGBY. The group’s name is a play on NIMBY, or Not in My Back Yard, the acronym used to describe residents who object to new housing or other development where they live.
For congregations that face declining revenue and membership, developing housing can offer a financial benefit while also expanding their social mission.
Like the Enterprise development program, YIGBY wants to help faith leaders navigate the home-building process. Instead of relying on tax credits for development, the group hopes to demonstrate how foundations, corporations, and wealthy people can help increase the supply of affordable housing without necessarily spending a dime. Using a construction loan guarantee, foundations or donors pledge to repay a loan with their endowment or other assets. This helps developers access the funds they need while removing risk for the lender.
“We’re trying to go around the political mess and just get the housing built,” Ball says.
YIGBY is helping Bethel African Methodist Episcopal, San Diego’s oldest Black church, replace a worn-out duplex on land it owns with 26 new one-bedroom apartments for homeless veterans and older people. The region’s severe shortage of housing means that many veterans who receive a housing voucher from the Department of Veterans Affairs often can’t find a place to rent. Housing analysts estimate the San Diego region needs to build more than 13,000 new homes annually to meet demand.
Banks are often reluctant to lend to first-time developers, so YIGBY has turned to donors, in addition to low-interest loans, to help finance Bethel’s project using a construction loan guarantee. Andy Ballester, a co-founder of the crowdfunding site GoFundMe, set aside around $5.3 million — an amount equivalent to the value of the construction loan. That money acts as insurance for the bank and will be tapped into only if the developer fails to make an interest payment on the loan.
In California, which has the most need for housing of any state, lawmakers recently reintroduced legislation intended to make it easier for faith groups, as well as nonprofit colleges, to build housing.
So why haven’t more faith groups built new housing to address the shortage?
“It’s just a simple time and money and expertise disconnect,” Ball says. And while these challenges aren’t unique to houses of worship, the need to get zoning approvals from government and deal with neighbors who resist new development often present obstacles.
Sometimes houses of worship are at an advantage when they try to work through local opposition, Bowers says. “If people perceive the house of worship as an anchor institution and a good neighbor in that community, sometimes they have goodwill that they’ve accrued over time, and that may help.”
As Arlington Presbyterian found out when it decided to sell, divisions within the church can get in the way, too. Debates about the church building and property caused decades of conflict to bubble up, says Goff. Around two-thirds of church members left, some of whom wanted the church preserved as a historic landmark, or at least rebuilt. But for those who pushed the plan forward, those broken relationships were “not enough to impede the call.”
The church continues to look for ways to address the housing crisis in its backyard using dollars from the windfall sale of its property. In March, the church gave $200,000 to the Arlington Partnership for Affordable Housing to help pay off outstanding rent balances for as many as 200 low-income residents at risk of eviction at properties including Gilliam Place.
Places of worship are “in need of revenue and relevance,” says Ball, leader of community outreach at YIGBY. “When you’re in the middle of a housing crisis, if you’ve got land, the best way to generate revenue and become socially relevant is build housing.”
Reporting for this article was underwritten by a Lilly Endowment grant to enhance public understanding of philanthropy. The Chronicle is solely responsible for the content. See more about the Chronicle, the grant, how our foundation-supported journalism works, and our gift-acceptance policy.