We want to buy an endowment (Wakf) for the Masjid in small town hoping the rent will cover some of the expenses for Masjid. Would this be considered as Zakaat.

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad is His slave and Messenger. We ask Allaah to exalt his mention as well as that of his family and all his companions.

It is not permissible to buy the Waqf (endowment) whose revenue would be spent on the mosque from the Zakat money because Zakat should be spent on the eight kinds of people whom Allaah, The Most-High, has described in His Book as He says: (the interpretation of meaning)  {Zakat is only for the poor, and needy and those employed to collect (the funds); and to attract the hearts of those who have been inclined (towards Islam); and to free the captives; and for those in debt; and for Allaah's Cause (i.e. for Mujaahideen who fight in a holy battle), and for the wayfarer (a traveller who is cut off from everything); a duty imposed by Allaah. And Allaah is All-Knower, All-Wise.}[9:60].

Zakat money should not be used as Waqf whose revenue is spent on people other than those who deserve the Zakat. This is the preponderant opinion according to the people of knowledge.

Allaah knows best.