Surviving and Serving Through Housing

CHARLOTTE, N.C.— The 5,000-member St. Paul Baptist Church pioneered faith-based affordable housing here in 2019 as a stronghold against the influx of wealthier residents moving into its traditionally working-class neighborhood. Since then, more than a dozen churches in the city have followed St. Paul’s lead, some of them as small as Newell Presbyterian, a church with about 80 congregants that recently was on the verge of running out of money. This year Newell expects to welcome a village of affordable for-sale homes, a project that has revived the church and its bottom line.

Cities across the country are searching for new strategies to build housing that is considered affordable—federally defined as no more than a third of someone’s income—to working class residents who are increasingly being priced out. Amid this affordability crisis, a challenge similar to what Dallas is presently navigating, Charlotte is finding great success partnering with places of worship.

St. Paul’s construction was the first of at least 1,500 units of affordable housing created by local churches since 2019. Today Charlotte’s new faith-based housing initiative has led at least 100 congregations to express interest in transforming their land. And that land is precious. 

“The churches can bring land to the table,” says St. Paul senior pastor Robert Charles Scott, whose own congregation was pushed out of downtown Charlotte in the 1960s. “And one thing God ain't making any more of is His land.”

St. Paul Baptist Church Invests in Longtime Neighbors

Scott was still new to St. Paul when a handful of naysayers showed up at his office in the fall of 2016. They were there to derail the construction of the ambitious affordable housing project across the street—the culmination of years of work begun by Scott’s predecessor, Gregory Moss, in fast-gentrifying Belmont, just east of downtown.

They argued that the project was not in the best interests of the church, which had moved into this residential neighborhood of craftsman-style bungalows in 1970. They said St. Paul’s leaders were foolish to give away valuable land. They contended the development would cater to people who, in their words, “were degenerates or worse.”

These prophets of doom weren’t the church’s neighbors. They came from inside Scott’s own congregation. “That group wanted me to kill the project,” Scott says 10 years later. “I wasn’t going to do that. I believed in Dr. Moss’ vision and I trusted [developer] Dionne Nelson.”

Scott didn’t waste time worrying about who was circulating false information or their motives. Instead, he made sure everyone in the congregation understood the deal stipulated that the church retain ownership of the property and its future uses. He explained how an experienced property management company would ensure the rentals didn’t become havens of drugs, prostitution, or gun violence—all of which had bedeviled the community a decade earlier. 

He pitched from the pulpit, preaching on Matthew 25:31-46, the parable of the sheep and the goats, whose message is that genuine faith is demonstrated through compassion and service to others, especially the marginalized, poor, and needy.

By the time the development opened in 2019, even the loudest critics were satisfied. “Some of the same people who were opposing it were going around saying, ‘Look at what our church did,’” Scott says with a big laugh. 

From the front steps of the church’s two big red brick buildings, visitors today are greeted by 112 attractive rental units built on three-and-a-half blocks of land surrounding St. Paul Baptist. Called Centra Square, the development includes the 60-unit Moss Place senior housing building, 29 townhome-style family units, and a 23-unit three-story apartment complex. Centra Square targets households with 60 percent of the area’s median income and below. For a family of four in Charlotte, that’s $67,320 or less.

Most of the half dozen neighbors I talked with on a December afternoon—hardy millennials and zoomers walking their dogs despite the bone-chilling wind—were unaware that the red- and brown-brick complexes and pastel-painted townhouses they often pass are designated for affordable housing. 

Elizabeth Leach was the exception. Leach, who is in her 30s, learned about Centra Square four years ago as she and her husband considered buying a renovated blue-frame home one block from St. Paul’s. “I love that the church stepped up and took this on,” she says. Pointing to the new modernist-style homes and to-the-studs cottage renovations nearby, Leach says, “This area is gentrifying and I worry that without housing like this people won’t have a place to live.”

Other neighbors were more interested in talking about Belmont’s proximity to downtown, the short walk to a light-rail stop, and the community’s quiet atmosphere. They commented frequently about how safe they feel in a neighborhood that longtime residents tell them was once extremely violent.

St. Paul’s oldest worshippers don’t need reminding of those bad Belmont years; they lived through them in the church’s first decades in the predominantly single-family neighborhood. Before the move to Belmont, the church, founded in 1900, occupied various sites on the edge of downtown. But in the late 1960s, influenced by the “urban renewal” campaign sweeping the nation, the city pressured St. Paul to sell its beloved sanctuary. (Today a Sheraton hotel sits on that property.)

St. Paul found a vacant but stately red-brick church building for sale a mile east in Belmont, a community from which whites had fled as middle-income Black residents moved in. Slowly, they too moved away as more homes became worn-down rentals and neighbors constantly battled drugs, gangs, and the accompanying violence. According to St. Paul historians, the intersection of Belmont Avenue and Allen Street, two blocks from the sanctuary, was long known as “Murder Corner” because “somebody was getting shot at least once a month at that spot.”

To keep the crime off its doorstep, the church slowly bought surrounding land and partnered with its new lower-income neighbors to lobby for increased community policing. The city eventually purchased and cleaned up several properties that were high-traffic spots for drug and gun purchases. St. Paul also built a new modern sanctuary alongside the original building, which was converted for education, youth services, and office space. 

As the neighborhood turned around and newcomers arrived—lured by the attractive craftsman bungalows and proximity to downtown—Moss, Scott’s predecessor, saw the threat behind Belmont’s newfound popularity. It’s the same concern that has led churches in southern Dallas, such as Cornerstone Baptist and Concord, to take steps toward building affordable housing projects, beginning with land acquisitions. With property values rising, how would longtime residents, especially seniors, cope with sky-high taxes and rents?

Moss’ answer was for St. Paul to support those residents being priced out by launching an affordable housing effort to be constructed on the blocks surrounding the church.

St. Paul was the first religious institution to step out on housing affordability in a big way and the first to use the city’s Housing Trust Fund to help finance its work, according to Council member LaWana Mayfield, who leads the city’s new Faith in Housing initiative, which offers financing and educational help to churches interested in developing housing. “They set the model,” she says. “There was no Faith in Housing back then. This was them going it alone and persevering.”

Moss retired from the pulpit in 2015 after getting the Centra Square deal to the starting line; Scott was in charge throughout the construction. At their side was Nelson, the developer who in 2011 founded Laurel Street Residential to build affordable and mixed-income housing. While church leaders are understandably wary of outside developers, Scott says, Nelson built a reputation for quality projects that benefit residents most in need of help.

“Dionne [Nelson] is a Black woman who gets us, so she brought what I would call instant credibility,” Scott says. “She's able to identify with the needs and the struggles of the people we're trying to serve.” Plus, he says, her staff is diverse in age, race, and experience, and her body of work has proven that her projects will be done right.

Once Moss partnered with Laurel Street, the developer secured construction funding from investors who received a tax credit for their part in the low-income housing as well as a direct investment from Bank of America. The city’s Housing Trust Fund finished the capital stack. Because St. Paul retained ownership of the land, its lease agreement with Laurel Street created an ongoing revenue stream for the church. 

Under state law, although the church owns the land, Centra Square is required to pay property taxes because all its partners are not nonprofits. (The levying of property taxes on faith-based projects in North Carolina is based on a complicated equation that involves a deal’s structure, the ownership of improvements, and the income levels served by the housing. In some cases in which all the partners—with the exception of the tax-credit investors—are nonprofits, state law allows a property tax exemption.)

Of St. Paul’s 5,000 active members, several thousand participate online. Almost three-quarters of the congregation live outside of Belmont, and many drive 100 miles or so, including from South Carolina, for Sunday services. The church lacks a large contingent of middle class and high-income earners, Scott says, “but we are prosperous in the sense that I have salt of the earth people who really want to make a difference in the community and the lives of others.” 

Centra Square is perhaps St. Paul’s most significant ministry, Scott says. “It is impacting the lives of 112 families, and that is what transformation and liberation is—a space where people can feel safe, have some sense of stability, and perhaps, prayerfully, land in a spot where they can save some money for more permanence in the future.”

Assistant city director Warren Wooten, who oversees affordable housing, says the likelihood of lower-income residents being displaced in Belmont is apparent in every residential sales listing. “Properties that sold for $30,000 in the midst of the public safety crisis today go for $1 million,” he says.

“St. Paul created some real change—keeping people from having to change school districts or zip codes,” Wooten says. “It’s a huge play to get assets like this into those areas to counteract some of the pressure that's going on.” 

Newell Presbyterian’s ‘Big Holy Risk’

Pastor Matt Conner, unusually grave and a little nervous, sat down with the leadership team of tiny Newell Presbyterian and asked for a decision about the 4.5-acre field visible through the small conference room’s stained-glass window. Were they prepared to sell the property in order to save the church? He knew the idea of giving up the land—even to balance the budget and provide affordable housing for neighbors—was excruciating.

But time was running out. For almost 18 months, this 80-member church, located in a still largely undeveloped pocket of northeast Charlotte, had been in prayer and discussion. On that spring 2023 day, Conner needed to know whether to move forward on a deal that would lead to about 50 for-sale homes rising on the former farmland.

“Churches hold on to property because we might need it for a rainy day, right?” he recalls telling those assembled. “Well, it’s raining now—on us and on a lot of neighbors. We can play it safe and just wither away. Or we can take a really big holy risk.”

One by one, those around the table that day responded with the same two words: “Risk it.” 

When Conner took the vote to his congregants, they too unanimously agreed to his challenge: “This may not secure the church’s future. But if 50 families are able to call this land home, is it death or is it Easter?”

This church was founded in 1889 by 31 Presbyterians in what eventually became the working class farm community of Newell Station. Its only claim to being a town was the regular mail service; the bag dropped onto a hook by a train headed to Charlotte. For almost a century, the landscape changed very little. Even after Charlotte began annexing unincorporated Newell in the 1990s, it remained a place of crops and cows, dotted by the farmhouses of families who tended to both. 

That country vibe has changed dramatically in the last decade or so thanks to Charlotte’s rapid growth, along with the equally fast expansion of the nearby University of North Carolina at Charlotte. Today modern townhouses, suburban-style brick-home subdivisions, apartment complexes labeled as “luxury living,” and chain convenience stores and fast-food restaurants sprout weekly on the pasture land.

Clusters of tall pine trees and original farmhouses have survived, but within a mile of Newell Presbyterian, builders estimate 2,000 or more homes will be built in the next three years. One-bedroom apartments rent for $1,900 monthly and homes previously valued at $350,000 have grown to $500,000 or more in the last five years.

The growth boom didn’t improve Newell Presbyterian’s fortunes. The church built a new brick-red sanctuary in 1979 to seat 200 worshippers, but by the time Conner took the pulpit in 2017, most of its pews went unfilled. Four years later, the pastor explained a reality that everyone knew but no one had wanted to say out loud: The church’s $185,000 annual budget was unsustainable and they had 18 months to find a way forward. 

Looking back, Conner sees the deadline as a blessing. “We couldn’t committee it for 30 years,” he says, “but the time was there to be really intentional about stewardship of the space.”

Rather than “a desperate fire sale” of the land that would give the church no say in the property’s future, Conner and church members devised a plan with nonprofit developer DreamKey Partners that would put the land to use as a housing project benefiting neighbors priced out of the community. 

A land sale to a commercial developer interested in market-rate homes would have netted the church a bigger payout. But the congregation instead focused on those they call the “forgotten middle,” social workers, first responders, teachers, and nurses, most of them first-time homeowners.

The final plan calls for a four-and-a-half acre village of 54 townhomes to be built in the swath of prairie just beyond the church’s small parking lot. The three-bedroom, two-bath houses, between 1,200 to 1,300 square feet and built in clusters of three, will be reserved for families who make 80 percent or less of the area’s median income. For a family of four at 80 percent AMI, that’s $89,750. The deed restrictions ensure both that the homes be owner-occupied and, if the property is sold, it goes to another family with the same income limits. Known as Newell Station, a nod to the long-ago rail mail drop, the project is expected to break ground in the next several months. The first homes should be finished before year’s end.

Income from the land sale will supplement the congregation’s annual offerings, and the project creates what Conner calls a “field of dreams” where people can sink roots. “The goal wasn’t to see how many homes we could squeeze onto the land but to prioritize togetherness and community,” Conner says. “Even the simple act of placing a front door toward another one starts to accomplish that.”

Fred Dodson, with DreamKey, which is financing and building the $16.8 million project, is aware of the many calls the church received from market-rate developers. “Instead, by building affordable housing there with 30-year deed restrictions,” he says, “it's going to create an oasis of affordability surrounded by high-end market rate and dense development over the coming years.”

Gap financing from Charlotte’s Housing Trust Fund will help make this conventional loan project work for DreamKey. Like all the other faith-based building initiatives in the city, this one would not have been possible without the dollars provided by the 25-year-old fund and the City Council’s championing of these efforts.

Not all of Newell Presbyterian’s neighbors love the idea of yet another development in the area, especially one labeled “affordable.” “People are watching an area they love change, and so that comes with grief, that comes with excitement, that comes with traffic and headache and everything in between,” Conner says. He was heartened that no organized opposition formed against Newell Station. Not a single person spoke against the project at the City Council’s zoning approval vote. 

When Conner presents the project during neighborhood meetings, he makes a point to use the words “affordable housing.” “Some shy away from it, call it ‘workforce housing,’” he says. “It’s important to reorient the narrative of what affordable housing is, to de-stigmatize it a bit.”

Among the residents on hand for Conner’s presentation was Brian Diebling, who, along with his wife and their three young children, has lived across Rocky River Road West from Newell’s sanctuary since September 2019. Diebling, who works for a Big Four accounting firm, left the community meeting inspired. “That a church that at the time was dying and not thriving, yet finding a way to help others—and somehow unanimously aligning on this vision—was exciting,” Diebling says.

Although Diebling and his wife were fond of the nondenominational church they had long attended, they believed their children would benefit from a smaller congregation. Today they are among Newell’s newest members and often bike or walk to church on Sundays. Diebling says, “Knowing the heart of the church and what they were doing with affordable housing was definitely a key variable in our being there.”

Just as the church’s affordable housing work has attracted about a dozen new members, Conner says, it has reinvigorated everyone in the congregation. “This sense of identity and purpose has put folks out there championing affordable housing in Charlotte that maybe wouldn’t have been vocal leaders in it otherwise.” Newell’s commitment to the project is so great, Conner says, that even if the church’s budget was healthy, it would still break ground on Newell Station.

Every faith-based deal in Charlotte is different, as are the circumstances that led the churches to do the work. The threat of displacement drove St. Paul’s work; a financial crisis sparked Newell’s. What binds these projects together is both churches owned the property necessary to make any affordable housing deal work. 

“I don't think you expect a church like little old Newell to do something like this,” Conner says. “But God can use your church or your synagogue or your mosque. … You just have to have people willing to say, Let's risk it together.” 

COMING NEXT WEEK: We’re back in Dallas for the final piece in our series examining faith-based housing. We’ll report new data detailing our city’s growing affordable housing shortage and speak to elected officials, city staff, and other stakeholders about their plans to solve it.

Sharon Grigsby is the co-founder and senior writer of The Lab Report. [email protected].

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