City leaders question sale of Lakewood property
HOUSTON Lakewood is the largest church in America. It currently holds services in what longtime Houstonians know as The Summit or the Compaq Center where the Houston Rockets used to play. So why do some council members think it's a bad deal? For a city strapped for cash, selling off some prime real estate may seem like a good idea, but first the mayor's office needs to sell it to council members. On Wednesday, many weren't buying the proposal. "There are a number of assumptions here that I have a problem with, in terms of doing the financing, I think this is a very large asset that we're willing to discount heavily for this sale," said Council Member Stephen Costello. "I think we need to ask tough questions, at the beginning and not at the end, I think that is part of the reason we're in the predicament we're in," said Council Member Jolanda Jones. "Location is everything, and I think we're selling incredibly short." The problem is that Lakewood Church already pre-paid $11.9 million on its 30 year lease six years ago and the city isn't getting any money out of this property, so it's proposing a sale - $7.5 million for seven acres of land. That's roughly $25 per square foot. Council Member Sue Lovell says the city should take the money. "So this is a better deal for us, to get the money now when we need it, than just sit there and not receive a dime on the property," she said. Mayor Annise Parker's office points out that because the church doesn't pay property taxes and pre-paid its lease, the city isn't getting any money from a very prime piece of real estate, and the city needs money. "It's never an easy deal to get done, it's not an easy deal to modify, but I think we have an opportunity to put money in the city's coffers today rather than waiting 23 more years," said Mayor Parker. Unsatisfied with explanations from the mayor's administration, council members delayed the sale and instead will conduct a full hearing next week. For Lakewood Church, they expected the delay, but also expects the deal to eventually go through. "The city approached us, we entertained the offer, we're willing to pay the $7.5 million and hopefully the city council will agree to that," said Don Iloff, Jr. with Lakewood Church. However, some council members are not so certain. Council Member Melissa Noriega wants to know how much the Houston Independent School District sold its old headquarters near Lakewood Church. It's now a shopping center. "I just want it all laid out so I can see it. I'm the kind who wants to see what they paid us before and what is now, and what is total over time," Noriega said. HISD says it got $38 million for the 24 acre property back in 2006 or about $36 per square foot. That's still considered a deal. The property adjacent to Lakewood Church is valued at $50 a square foot, but the church says it's doing the city a service by leasing, renovating, and now buying the property. "Had it not been for Lakewood's investment and the development of the Compaq Center, today it would be an empty building, sitting in possession of creditors," said Iloff. Lakewood's sanctuary seats more than 16,000 people, and Pastor Joel Osteen delivers his sermon to more than 43,000 people every week. Lakewood's television ministry reaches 200 million households a week.
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