What You Need to Know About the Church of Scientology's Real Estate Empire
The Church of Scientology—the organization dedicated to the works of science fiction writer L. Ron Hubbard—has been deeply involved in the real estate business ever since its creation in 1954. With the donations of its followers like actor Tom Cruise, who's given millions, the Church has built a real estate empire. The actual size of the Scientology portfolio is unknown, though the Church did confirm to the Hollywood Reporter that it bought 62 properties globally between 2006 and 2011. Here's what you need to know.
Trophy assets: The Church of Scientology has been buying, building and refitting properties for decades now, gaining a stellar collection across the country. Check out our slideshow of these 10 properties, examples of its most impressive efforts at reusing historical properties.
Location: Pretty much everywhere. While the group has about $300M in properties in LA and Hollywood alone, it's claimed properties in cities all over the world. LA and the Big Apple seem to be the main hubs—with critics claiming both markets attract millions of disillusioned souls—but the Church and its acquisitions have spread both here and abroad. (Cities include Moscow, Mexico City, Melbourne, Seattle, Hamburg, Sacramento, San Francisco, Berlin, Manchester, UK, Washington, DC, and Clearwater, FL.) And these are just the known properties.
Acquisition process: The Church's got the buying and renovation process down pat. First, a local branch will inform the Church’s real estate team about a potential property, and once it's approved by the Church’s board, the real estate team uses large commercial brokerages to make a purchase. Sometimes the Church will use its nonprofit real estate arm—Social Betterment Properties International—to make acquisitions, sometimes through cash, according to Nonprofit Quarterly. The Church then will design the renovations for the building and either hire contractors through third-party companies or use its own members. Most importantly, however, the Church capitalizes on its role as a religious organization to gain tax exemptions on "buildings used for spiritual purposes," The Hollywood Reporter wrote. If true, the various properties would cost millions in property taxes if those exemptions were revoked.
Why: There are several theories. The Church has stated it is motivated solely by Hubbard’s desire to provide new locations for religious practice, as well as to create a better relationship with the various cities by improving old buildings. In reality, former members told Buzzfeed, the Church is trying to create an image that distracts the public from its controversial practices while appealing to its celebrity members. Critics also say the rapid purchase of properties is just another way for the Church to wring more money from its members (ex-Scientologists called it a "real estate scam"), even leaving some purchased properties—like the 15-story Cunningham Piano building in Philadelphia—vacant for years, insisting that they will get around to renovating it eventually, Gizmoto reports.
How: The Church claims to be a good neighbor because it keeps a large security presence around its properties, in turn making surrounding neighborhoods much safer. In fact, Scientologists have received praise for their safety, renovation and maintenance of landmarks from preservation societies, cities, the California State Legislature and even the Los Angeles Business Journal.