Church Mergers: The Complicated Business of Combining Congregations


Seven years ago, Interbay Covenant Church was an older congregation that did church in the traditional way, singings hymns from the bible in a quiet, brick church in Seattle. Across the street at the Quest Church, a much younger flock came to services in sandals and shorts and sang along to a rock band in a rented warehouse that was owned by Interbay. To make a long story short, Interbay saw this younger crowd as its future. The 70-year-old church literally gave itself away, along with all its multimillion dollar properties, in a church merger with Quest.

Quest is still going strong. Two very different churches managed to come together and make it work, so this is an example of a church merger that has been successful. But the story still gives us pause.

Not all church mergers go so well. In California, for example, a South Bay church merged in 2008 with a dying church in Bellflower, whose attendance had dropped below 50. In this case, the congregations couldn’t get along and squabbled over practically everything, including how to fix up Bellflower’s aging facilities. Within five years, the two congregations had split up, leaving bad feelings and unfinished plans.

Church Mergers Are a Growing Trend

Across the United States, church mergers have become more common. Large churches are taking over struggling, smaller ones. Healthy churches are also joining forces to pool their assets and members so that the church ‘brand’ can spread more easily among the faithful.

A church will have its own unique reasons for joining with another church, but every merger is the same in one respect. These always involve an intermingling of property. One church may take over the other church’s facilities. A congregation may move out of its existing building, leaving surplus property to sell. Two churches may unify and decide to build a new church. All of these are sophisticated real estate deals. That is why the story of the successful merger in Seattle gave us pause. Even though one church gifted all its property to the other church, it was still a major commercial real estate transaction. With two different groups coming together and valuable properties involved, we can see many ways this merger could have gone wrong.

Some Common Mistakes in Failed Church Mergers

A church can make many mistakes when merging with another church. Relating to real estate, however, we’ve noticed some big mistakes that churches sometimes make:

The church didn’t define the relationship: Who will be calling the shots? If churches don’t determine the nature of the relationship after the merger, they are looking for trouble on future facilities decisions. For example, is the merger ‘an adoption’ where the new church takes over the old one? Or is it ‘a marriage’ where the two sides have an equal say in the future direction of the properties?

The church didn’t understand the liabilities: We’ve preached this point often in earlier blogs: properties aren’t necessarily assets if they come with major liabilities, such as environmental problems and crippling debts. The merging churches need to take a hard look at any potential environmental, financial, and legal problems with the land and facilities.

The church didn’t consult donors and members: Churches have a special challenge when selling surplus property because people are often still attached to the land and building. Many merging churches go back multiple generations. Families often donate significantly to the building of the church. Before a church enters a merger, members need to decide what will happen to the facilities and should agree on broad terms regarding whether or not the property can be sold.

Church Mergers Are Complicated

As churches struggle with aging membership and low attendance, we expect to see many more church mergers. This month, a mega-church in Jacksonville, Florida, took over a struggling church about 20 miles down the road in another town. This has made national headlines because the mega-church happens to serve predominantly black members while the struggling church is white.

While this is a nice story about how two churches are bridging the racial divide at a time when tensions have been running high, it will only stay a nice story if the merger works out. Behind the handshakes and smiles, some hard decisions had to be made about the property. Like all commercial property deals, mergers are complicated, and churches shouldn’t go at it alone. The congregation needs to hire professionals so that the congregations can avoid mistakes and create a lasting, unified church. This team should include a commercial real estate consulting firm that is experienced with church sales and facilities.

If your church is considering merging with another church, you don’t have to go it alone. You can get a thorough analysis of the property value and facilities from a consultant whose community values align with your own. Contact DCG Real Estate today to learn more.