Thirteen historic properties in Covington's Mainstrasse Village will be fully restored to historic standards, a developer told The River City News in an exclusive interview on Wednesday.
Last week, The River City News broke the news that the properties had been acquired in a transaction involving the Welcome House and the Model Group, a move that changed ownership of the multi-family residential buildings from Dudley Properties. On Monday, the ambitious project was awarded nearly $700,000 in federal low-income housing tax credits.
The Welcome House is a Covington-based social services agency whose executive director, Linda Young, said is moving towards developing more affordable housing opportunities particularly for single parents raising children. "We're really looking at people on fixed incomes or working who just can't make it if they are renting market rate," Young said. "This whole thing, for me, is about kids."
Young pointed to the high transient and homeless rate of students within the Covington Independent Public Schools system as a primary motivator. "We've already got a poverty rate that is going up and nobody can convince me that it's going to go down if they are not getting an education," Young said. Having suitable housing is one way to keep families in place and children in the same school, she said.
Steve Smith, CEO of the Model Group, a Cincinnati-based development company with a long resume of success in Over-the-Rhine and with Covington's former Fifth District School that is now a residential building, said that the housing development will create residential units that people aspire to live in. "This pushes Covington forward by getting a responsible owner in place, a full gut rehab, and exterior renovations that will inspire additional development," Smith said. The goal is to make low-income housing indistinguishable from market rate rental units, something that cannot be said about the current state of the targeted properties.
City Manager Larry Klein told The River City News last week that Dudley Properties had been a consistent target of Covington's code enforcement board.
Young said that code enforcement is never called to any of the properties owned and operated by the Welcome House. "We made a turn four years ago that we needed to focus on affordable housing," she said. The problem was that the decision came amid the economic downturn and related real estate troubles, so a large contribution from a donor that wants a focus on single-parent affordable housing rested in the agency's coffers until conditions improved. Early this year, the opportunity arose for the Welcome House to make its move and already Young said that her supervision is having a positive impact on the historically troubled properties. "We have already started some walk-throughs," she said. She assures neighbors that the housing will be improved and that her agency will have responsible oversight of the properties.
"Drug dealers don't want anything to do with me," Young said, adding that there would be additional lighting and security cameras added where needed.
The work will come in two phases. The low-income tax credits awarded this year through the Kentucky Housing Corporation will be applied to 801 and 803 Main Street, 710-712 Greer Avenue, and 257, 301, and 315 West 7th Street. The other properties purchased in the deal will be targeted for additional tax credits next year. The project will also be eligible for historic tax credits because the Model Group plans a full historic renovation. Currently there are 53 rental units spread out across the properties, a number that will be reduced to 41 when the work is completed.
At least one commercial space, at 801 Main Street, will be restored, too. Smith said that having a viable commercial operation in a building boosts the effort of making the low-income housing indistinguishable from market rate.
After some additional paperwork and housekeeping items, the closing date on the tax credits is in early December and construction should begin shortly after. The first phase will be complete by the end of 2016, Smith said.
In the meantime, the Welcome House will begin its strict oversight of the current units. After all, the properties are part of the largest financial deal that the agency has ever been a part of, Young said. "We want this to be successful because we want to continue down this path," she said. "There are college graduates who can't afford market rate."
"The big advantage that this development has is that it is already a big part of a community that has been around for more than a hundred years," Smith said. "We're not trying to copy a beautiful neighborhood. I'm a preservationist. This is a big deal for me. These are real buildings that are part of the street grid and part of the fabric of the community."