What fraternities own their houses?

[Rudey]

Let me be more specific. I heard something and I just wanted to see if it's true.

Which fraternties own ALL of their houses at a national/international level?

-Rudey

[Firehouse]

Most nationals do not want to own property in the national name. When you see a reference that such-and-such a fraternity "owns" so many millions of dollars in housing, they're likely refering to the total value of property owned by the individual chapter house corporations. Most large nationals have a real estate arm to provide professional assistance and loans to local house corporations. No large national owns all their housing. Many don't own property at all.

[Rudey]

Originally posted by Firehouse
Most nationals do not want to own property in the national name. When you see a reference that such-and-such a fraternity "owns" so many millions of dollars in housing, they're likely refering to the total value of property owned by the individual chapter house corporations. Most large nationals have a real estate arm to provide professional assistance and loans to local house corporations. No large national owns all their housing. Many don't own property at all.

Would you be able to say how many houses Pike has or should I let that go?

-Rudey

[FSUZeta]

zeta tau alpha has a national housing corporation, and was the first to do such a thing. i can't tell you how many houses the national housing corporation owns, but i do know that the fsu and uf chapter houses are owned by the national corp. with the millions of dollars available to the nationally owned houses, suites and lodges, they are able to keep these properties in pristine condition and to update and redecorate as needed. zeta also allows local housing corporations to exist, but in my estimation, the nationally owned properties are the way to go-much more money to work with.

[EXColony]

Sigma Chi has an International Housing Corp, but each chapter is required to setup one of their own. The local corp actually owns the house...that's what I've been told.

[Kevin]

Originally posted by EXColony
Sigma Chi has an International Housing Corp, but each chapter is required to setup one of their own. The local corp actually owns the house...that's what I've been told.

Sounds similar to most groups.

Sigma Nu maintains a foundation that has the ability to loan money to housing corps for houses or whatever. However, we have to maintain our own local house corps.

It's a legal shield to the national organization.

[Rudey]

Originally posted by ktsnake
Sounds similar to most groups.

Sigma Nu maintains a foundation that has the ability to loan money to housing corps for houses or whatever. However, we have to maintain our own local house corps.

It's a legal shield to the national organization.

Yes I know we all break down into corporations for each house, but I want to know which national actually OWNS each house. There were a lot of fraternities that folded during the Vietnam era because they didn't have corporations for each individual chapter house, mortgaged each new house with a previous house, and when membership went down a domino effect took the entire fraternity down.

-Rudey

[Firehouse]

Rudy, you asked me to comment specifically about the Pikes. They have a realtively huge (four full time staffers plus support) Real Estate Department and a volunteer Real Estate Commission, however their goal is not to own property.
That was not the case in the Vietnam era, as you pointed out. In the mid-1960s, Pi Kappa Alpha planned to build and own three traditional colonial fraternity houses: one at Florida State, one at West Virginia, and a third at North Texas State. The plan called for the national fraternity to use revenues from the properties to finance future construction at other chapters. The North Texas house was never built, but houses at FSU and West Virginia were completed in 1966. As you described, the upheaval of the '60's took its toll and the plan collapsed. Florida State had a very succesful chapter, but not always current with their 'rent'. West Virginia's chapter never recovered from the downturn, and eventually went under. FSU's chapter was lost to an incident in 1988. West Virginia is back now, and strong and the local alumni bought the house from national. National sold FSU's house, but the chapter is back and strong, and we are building our own $4 million house with alumni money (the chapter got no equity nor any money from the sale of the old house). Fortunately, IIKA didn't lose ground nationally with the ill-advised policy. But I do understand the reasons we did it, and under the circumstances I might have gone along with it at the time.
I know of two substantial national fraternities who became very aggressive in housing right after the hippie/Vietnam era. They did exactly what you describe: buy and own properties, and hope that the chapters would rise to the challenge and provide revenue streams to finance future projects. I think one national was successful, and the other lost their shirt. I don't want to name them; you can pm me if you want the names.

[Tom Earp]

Rudey, National or International Organizations Do Not Own Chapter Houses!

I can only Speak for LXA, but we have a Group that is volanteer who will help in financing. Each Chapter has a Housing Corporation that either owns the Chapter Houses or have authority over them.

Your questions seem to be redundint.

They Do Not Own the Houses, how about Yours?

Does Your Greek Organization OWN ALL OF YOUR CHAPTER HOUSES?

Da I say NO!

[Rudey]

I will send you a PM. I had heard about a few fraternities that weren't big but still sizable and failed because they made the housing purchases prior to vietnam...this could all be very wrong.

Also this I will ask in public. What is the reasoning behind individual chapters owning houses? With the national owning the houses they have a larger group of assets which might make it easier for future expansion. Of course it would be much more difficult to keep houses top notch since it's easier for a local chapter to respond to problems for that chapter. I've seen several Pike houses that I've been very impressed by. The fundraising at the local level - again, impressive.

-Rudey

Originally posted by Firehouse
Rudy, you asked me to comment specifically about the Pikes. They have a realtively huge (four full time staffers plus support) Real Estate Department and a volunteer Real Estate Commission, however their goal is not to own property.
That was not the case in the Vietnam era, as you pointed out. In the mid-1960s, Pi Kappa Alpha planned to build and own three traditional colonial fraternity houses: one at Florida State, one at West Virginia, and a third at North Texas State. The plan called for the national fraternity to use revenues from the properties to finance future construction at other chapters. The North Texas house was never built, but houses at FSU and West Virginia were completed in 1966. As you described, the upheaval of the '60's took its toll and the plan collapsed. Florida State had a very succesful chapter, but not always current with their 'rent'. West Virginia's chapter never recovered from the downturn, and eventually went under. FSU's chapter was lost to an incident in 1988. West Virginia is back now, and strong and the local alumni bought the house from national. National sold FSU's house, but the chapter is back and strong, and we are building our own $4 million house with alumni money (the chapter got no equity nor any money from the sale of the old house). Fortunately, IIKA didn't lose ground nationally with the ill-advised policy. But I do understand the reasons we did it, and under the circumstances I might have gone along with it at the time.
I know of two substantial national fraternities who became very aggressive in housing right after the hippie/Vietnam era. They did exactly what you describe: buy and own properties, and hope that the chapters would rise to the challenge and provide revenue streams to finance future projects. I think one national was successful, and the other lost their shirt. I don't want to name them; you can pm me if you want the names.

[Rudey]

Originally posted by Tom Earp
Rudey, National or International Organizations Do Not Own Chapter Houses!

I can only Speak for LXA, but we have a Group that is volanteer who will help in financing. Each Chapter has a Housing Corporation that either owns the Chapter Houses or have authority over them.

Your questions seem to be redundint.

They Do Not Own the Houses, how about Yours?

Does Your Greek Organization OWN ALL OF YOUR CHAPTER HOUSES?

Da I say NO!

Da I say YES!

Jesus Christ please stop talking to me and harassing me. It's quite obvious Lambda Chi has serious risk issues with you on board. I don't want to talk to you. I was asking a freaking question to get a better understanding about fraternities and real estate assets. Again, please stop talking to me.

-Rudey

[Firehouse]

Your question is: What is the rationale behind chapters owning houses? Why not have the national office own all of them and use that economy of scale in terms of financing and management?
Remember the old joke: If you're going into a dangerous city to drink all night and raise hell, what kind of car is best to drive? Answer: a rented car.
Nationals found out the hard way that chapters that own their own houses behave very differently than chapters that 'rent' from national. If the chapter is surrounded by alumni whose names are on the loan at the local bank, they benefit from association with those adults who have invested in the house. If you're renting a house in which you have no equity, there's a different attitude toward the structure.
The role that nationals play now is to recruit and train alumni house corp volunteers, to direct capital campaigns, and to offer the best legal and professional real estate advice to their chapters. They also try to stay ahead of campus trends and watch out for problems. And, the nationals do make real estate loans to qualifying chapters. But unless a national is heavily endowed and can afford to lose money on bad investments, assisting the local chapter and making them responsible for their own housing is the safest way to go.

[Rudey]

So it's a matter of personal responsibility and building ties to the area. Got it.

-Rudey

Originally posted by Firehouse
Your question is: What is the rationale behind chapters owning houses? Why not have the national office own all of them and use that economy of scale in terms of financing and management?
Remember the old joke: If you're going into a dangerous city to drink all night and raise hell, what kind of car is best to drive? Answer: a rented car.
Nationals found out the hard way that chapters that own their own houses behave very differently than chapters that 'rent' from national. If the chapter is surrounded by alumni whose names are on the loan at the local bank, they benefit from association with those adults who have invested in the house. If you're renting a house in which you have no equity, there's a different attitude toward the structure.
The role that nationals play now is to recruit and train alumni house corp volunteers, to direct capital campaigns, and to offer the best legal and professional real estate advice to their chapters. They also try to stay ahead of campus trends and watch out for problems. And, the nationals do make real estate loans to qualifying chapters. But unless a national is heavily endowed and can afford to lose money on bad investments, assisting the local chapter and making them responsible for their own housing is the safest way to go.

[Firehouse]

You say it more clearly and in far fewer words than I.

Firehouse, I've seen the plans for FSU's house in the Shield & Diamond. It looks like it's going to be beautiful!