It is being reported that the Watch Tower Society has secured a staggering $375 million deal for six of its most well-known Brooklyn properties.
The deal, signed with property developers RFR and Kushner Companies on July 5th 2013 represents a major leap forward in the relocation of the Society’s headquarters to upstate New York.
Watchtower’s use of the complex dates back 77 years to when the first property (117 Adams Street) was acquired in 1927 during the days of Rutherford.
The properties, familiar to Witnesses from Society publications, include the five factory buildings 117 Adams Street; 175 Pearl Street; 55 Prospect Street; 81 Prospect Street and 77 Sands Street. The tallest of the newly-sold buildings, 90 Sands Street, is a 30-story residential building completed in 1990 to house up to 1000 Bethel workers and visitors.
Below is a Google Earth image showing the locations of the six above-mentioned properties that have been sold…
And the following image shows the proximity of the newly-sold complex (in yellow) to the iconic Columbia Heights buildings (in red) near the Brooklyn waterfront…
What will the buildings be used for?
Civic planners in Brooklyn are trying to create what they call the “Tech Triangle.” By encouraging IT businesses to move into the area close to Brooklyn Bridge, it is hoped that a miniature Silicon Valley will be created within arm’s reach of bustling New York – thus allowing the local economy to prosper.
Planners view the sale of Watchtower’s buildings, all of which offer “loft-style creative office space,” as key to the Tech Triangle initiative. Tucker Reed, president of the Downtown Brooklyn Partnership, recently commented: “We identified the Watchtower properties in DUMBO as a key target for active commercial uses for the ‘innovation economy’ as part of our Tech Triangle study.” (DUMBO is an acronym for “Down Under the Manhattan Bridge Overpass”)
Although the majority of ex-Watchtower properties will likely get snapped up by IT companies, the Sands Street residential building could eventually be converted into a hotel. However, if that happens, any new owner will have their work cut out. A source for the Brooklyn Daily Eagle was unimpressed by the Bethel worker accommodation in the building, describing it as “spartan.” As the newspaper comments, “If the purchasers decide to use it as a conventional hotel they will need to combine rooms into larger units and spruce up the amenities.”
What’s the timescale for the move?
Five of the six newly-sold buildings are expected to be vacated as early as September this year, since printing operations have already been transitioned across to Wallkill. However, the 90 Sands Street residential building will continue to be used by the Society until 2017.
Interestingly, a rumour has recently circulated that the Governing Body notified the brothers responsible for planning the new Warwick HQ that they expect the new site to be operational by January 2017, even if this means shortcuts in the construction process. While this rumour is so far unsupported, it will be interesting to see what transpires with the new building project.
A JW.org video promoting the Warwick move is shown below…
So why didn’t you mention the price tag, JW.org?
JW.org has published a 280-word press release announcing their historic deal, but one piece of information is notable by its absence – the $375 million that Watchtower has gained as a result.
It is possible this was a mere oversight, or perhaps Watchtower’s press office didn’t feel the information was relevant. However, the skeptic inside me is inclined to think there was something more deliberate to this glaring omission.
Watchtower is in desperate need of donations, as highlighted by its recent decision to begin accepting credit card donations via JW.org (despite having criticized other churches for pursuing similar tactics in the not-so-distant past).
Imagine you are a poor Witness with a large family to provide for. You struggle to pay your own bills, but you still put something aside as a regular donation to the Worldwide Work – even if it means living without life’s small luxuries. Would you be so quick to put that 20 dollar note in the contribution box at the next meeting if you learned that the Society had just gained an extra $375 million? I know I wouldn’t.
It is for this reason that I believe the price tag for the property deal was omitted from the JW.org press release deliberately. Watchtower needs your donations, and they know publishers will be slow to donate if they are under the impression that the organization is suddenly flushed with cash.
*** UPDATE ***
Since this article was written, the following video was uploaded to JW.org discussing the deal. Notice that, despite praise from the new owners on the condition of the buildings and ease of dealing with the Witnesses, the $375 million pricetag is not mentioned once by the narrator.
But why is Watchtower moving headquarters?
One thing can be said with certainty – Jehovah’s direction had little or nothing to do with the Governing Body‘s decision to relocate world headquarters to upstate New York. This was admitted by Guy Pierce at the Annual Meeting in 2011, as revealed in a subsequent Watchtower article…
“There are plans to develop a 248-acre (100 ha) property at Warwick. ‘Although we are not yet certain of Jehovah’s will regarding Warwick,’ said Brother Pierce, ‘we are proceeding to develop the site with the intention of relocating the world headquarters of Jehovah’s Witnesses there.‘ Plans are also being made to use a 50-acre (20 ha) parcel of land situated six miles (10 km) north of Warwick to facilitate the staging of machinery and building material. ‘Once construction is permitted, we hope to complete the entire project within four years,’ said Brother Pierce. ‘Then our property in Brooklyn can be sold.'” (w12 8/15 pp. 16-19, click here to read on Watchtower Online Library)
This startling admission by Brother Pierce begs the question: “If the Governing Body aren’t even certain that Jehovah supports their decision to move, then why are they so eager to see these plans through?”
Rather than being motivated by any logistical or organizational demands, Watchtower’s move upstate carries an enormous financial incentive. By relocating to where land and property is relatively cheap, Watchtower can free up eye-watering amounts of money that for decades has been tied up in prime real estate in Brooklyn.
For example, last year (2012) Watchtower pocketed $81 million from the sale of the Bossert Hotel. In the same year, 183 Columbia Heights, 165 Columbia Heights and 50 Orange Street were sold for $6.6 million, $4.1 million and $7.1 million respectively.
In fact, every few years since 2004 (when 360 Furman Street was sold for $205 million), the Society has made millions by cashing in on the following properties…
- 2004 – 360 Furman Street – sold for $205 million
- 2006 – 67 Livingston Street – sold for $18.6 million
- 2006 – 89 Hicks Street – sold for $14 million
- 2007 – 169 Columbia Heights – sold for $50 million
- 2011 – 50 Orange Street – sold for $7.1 million
- 2012 – 165 Columbia Heights – sold for $4.1 million
- 2012 – 161 Columbia Heights – sold for $3 million
- 2012 – 183 Columbia Heights – sold for $6.6 million
- 2012 – 105 Willow Street – sold for $3.3 million
- 2012 – 34 Orange Street – sold for $2.825 million
- 2012 – Bossert Hotel – sold for $81 million
- 2012 – 67 Remsen Street – sold for $3.25 million
- 2013 – 173 Front Street, 177 Front Street & 200 Water Street – sold for $30.6 million
- 2013 – 55 Prospect Street, 81 Prospect Street, 117 Adams Street, 77 Sands Street, 90 Sands Street & 175 Pearl Street – sold for $375 million
TOTAL (so far) – $804,375,000
As you can see, based on the above list, Watchtower will have earned more than $800 million from the sale of properties once this sales is complete. Bear in mind the majority of the above properties were acquired at a fraction of the selling cost using donated funds, and renovated using a volunteer workforce. By the time the iconic Columbia Heights headquarters offices have been sold and the move is complete, the 1 Billion dollar mark could easily be surpassed.
For this reason, it is more lucrative to build a brand new headquarters in the middle of nowhere and go to the considerable trouble of relocating millions of dollars worth of equipment if this means freeing up the Society’s Brooklyn goldmine and pocketing a sorely needed cash windfall.
It may seem that Watchtower is flushed with money as a result of these sales – and indeed it may well be for the time being. However, this doesn’t mean that everything is bright and rosy for Watchtower’s future aspirations. As organizational downsizing continues, necessitated by stagnating publisher growth, and with the world awaiting the outcome of the Society’s appeal to the Conti verdict, don’t be surprised if this cash windfall gets used up more quickly than anyone expects.