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Are Megachurches Recession-Proof?

March 24, 2010

I was stunned to read that Lakewood Church would be purchasing The Summit (as it will forever be known) for $7.5 million. This seems like a paltry fee, considering land value along Highway 59 in Houston, proximity to Downtown, the building itself, etc. I consulted commercial real estate expert Buster Freedman, who explained to me that the city of Houston probably got a raw deal in the first place, letting Lakewood rent out the Rockets’ old stomping ground at some ridiculously low rate. Their 30-year lease would have brought the city a lump sum of $7.5 million anyway. In light of its considerable debt, it seems smart that the city took Joel Osteen’s money and ran.

Even still, $7.5 million up front is a sizeable amount. How many companies… excuse me, churches have this kind of cash at their disposals? I was reminded of an article I read more than a year ago, when we were still down deep in the recession with no end in sight. From the New York Times, “The Bread of Life, Baked in Rhode Island” tells of the Cavanagh family, who bake 80% of the country’s communion bread. They serve up nearly one billion wafers a year, and in spite of the recession, business was solid. The bread is available in both white and whole wheat varieties, printed with several different designs, and varies in thickness, depending on preference.

Though seemingly recession-proof, The Cavanagh Company was hit by a different kind of crisis: the clergy sexual abuse scandal of 2002. From NYT:

“Business dropped about 10 percent after the clergy sexual abuse scandal that rocked the Catholic Church in 2002, according to the Cavanaghs. But it has picked up recently — perhaps because of the growing worldly concerns that come with a bad economy.” Perhaps there is an inverse correlation between how financially weary people are and how often they turn to their faith for stability.

But I digress. A January 2010 article from PoliticsDaily.com, called “Rick Warren’s Recession – and the Saddleback Stimulus” recounts how Warren rallied his congregants, who are mostly in housing slump-ravaged Orange County, to donate over $2.4 million at the start of the year. Saddleback (mega)Church was poised to finish the year in the red for the first time ever. Instead, they ended up $1.4 million. In spite of the fact that many congregants lost their jobs and their homes last year, most of them still ponied up at least $100.

Furthermore, “a comprehensive survey last fall of congregations both large and small showed that during the first half of 2009 nearly 37 percent of churches reported an increase in fundraising receipts — though less than in 2008 — while 34 percent stayed the same and almost 30 percent saw a drop in income.”

People claim religion is recession-proof, and that’s clearly not always the case, but like any business, it takes charismatic, savvy leadership to get people in the door. Asking people to dole out donations once they’re inside is even more difficult a task, one that pastors like Osteen and Warren have clearly mastered. So maybe church and church-surrounding businesses like the Cavanagh Company aren’t recession proof, but it’s pretty obvious – especially if you try to drive anywhere near Lakewood Church on Sunday mornings – that Joel Osteen’s voice isn’t the only thing booming in that building.

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