Whether the Village’s purchase of the apartments at 10 Lawson Place was financially prudent was of little consequence to the Village administration of nearly five years ago.

When the 16-unit complex went on the market, Yellow Springs was in jeopardy of losing what had been, for almost 60 years, an affordable and reliable haven for local renters — one that notably catered to Black residents, even as diversity in Yellow Springs declined over the decades.

Fearful a developer that favored profits over people would scoop up the property, local leaders made their move: in November 2021, Council approved the purchase of Lawson Place for $770,000, with a $130,000 down payment and a 15-year loan to cover the rest.

Since then, the Village of Yellow Springs has retained control of the apartment complex and has functioned as the de facto manager of the property — dealing with its occupancy and maintenance, rents and renovations, tenant complaints and unit improvements.

A lot of work, but worth it.

That’s according to Village Council members and administrative staff who, at a housing-focused meeting on June 25, reviewed a comprehensive financial analysis of Yellow Springs’ past, present and future investments in Lawson Place.

Prepared for the Village by local government consultant Mark Schwieterman of the Shared Resource Center, the analysis weighed expenses against revenues, and detailed occupancy and market trends.

The report emphasized the property’s overall growth in value since the purchase. Per the latest assessment, Lawson Place has a current market value of $1,275,000 — a $514,000 uptick in equity since 2022.

While that investment has appreciated, the Village is still left with day-to-day costs. The report shows that revenues from rents can cover the apartment complex’s annual operating, capital and renovation expenses; however, the annual debt service still outpaces the revenues. According to projections, the Village will have a net loss of $329,050 by the time the loan is paid off in 2037.

“With the need for affordable housing,” Village Manager Johnnie Burns said, “$329,000 over a period of 15 years is not a huge loss to the Village to be able to secure the 16 units that we did. I think it means more to our community than the money.”

Based on Schwieterman’s projections, beginning in 2037, or when the debt owed on the property has been repaid, Lawson Place is on track to generate $63,110 in annual profit for the Village.

“And these are conservative numbers,” Assistant Manager Elyse Gairdullo said. “Who knows what the housing market will look like in 2036?”

Giardullo noted that, for his projections, Schwieterman relied on annual increases of 3% for operating expenses, 10% for renovation expenses and 5% for capital increases, as well as 3% increase in rental costs.

“So, this is working,” Council President Gavin DeVore Leonard said of the Village’s ownership of Lawson Place. “The math works and it provides a benefit.”

Currently, rents at Lawson Place are $668.37 per month for a unit that the Village hasn’t yet renovated since the 2022 purchase, and $725 for a renovated unit.

According to Burns, 11.5 units have been renovated — which, among other improvements, includes the installation of new appliances. All the rest are on track to be renovated as needed. There are presently no vacancies among the 16 units; when the Village took over, Burns said half were unoccupied and seven “weren’t even rentable.”

Burns also pointed out that the Village has, since 2022, put on a new roof and gutters and added a water heater to the complex.

Personnel costs of keeping Lawson Place running for tenants total around $30,000 annually — $5,000 to cover Village staffer Cameron Fortin’s work fielding phone calls from tenants and connecting them to resources, and $25,000 for the Public Works crew to mow, plow snow and take care of some miscellaneous property management jobs. Local contractors do all the rest.

Burns admitted to his initial skepticism of the Village’s decision to purchase Lawson Place and load staffers with additional labor. However, he said he’s proud of how much work has been put into the apartments and hopes the Village retains full oversight of its future — as opposed to switching to a third party property maintenance company, which Schwieterman’s report floated as a possibility.

“I’m dead-set against it,” he told Village Council members. “When your residents call, [the Village] should be taking care of it instead of a property maintenance person out of Dayton, Cincinnati, Beavercreek, saying, ‘We’ll get to you whenever.’ When residents call us, we know it’s a concern, we know who’s calling and we’re right over there.”

Schwieterman’s financial analysis gives the Village five options regarding the fate of Lawson Place and its oversight:

“Do nothing and continue on the current path” of Village acting as property manager and rent collector;

“Formalize” administrative and Public Works cost allocations — likely by going through a third-party property management company;

“Reduce contracting out” for Lawson Place and the other 11-Village owned buildings, potentially by hiring a facilities technician or maintenance person on Village payroll;

Continue annual evaluation of rental rates; or

Consider selling Lawson Place.

Though Village Council members unanimously extolled the Village for its efforts to keep Lawson Place as a comparatively affordable option for local renters, the group somewhat differed on who — or what — should maintain the property.

“I don’t think property maintenance should be in-house,” Council member Carmen Brown said. “Not everyone is going to get along every time. There needs to be a neutral party for something as personal as housing is. There should be distance between the Village and the residents at Lawson Place.”

Fellow member Stephanie Pearce and Council Vice President Angie Hsu agreed on the need to “professionalize” oversight of Lawson Place.

Burns maintained his position of keeping local control, but indicated that Village administrative staff is in the midst of conducting evaluations on whether hiring a full-time maintenance person would make financial sense.

“Right now staff has to be pulled out of their daily duties to do things — or we hire a contractor,” he said. “Now, we’re pulling contractor prices to see what it would cost for someone to maintain all 11 Village properties — someone who could fix a clogged drain for the police department or at Lawson Place, someone who may be at the water plant, lift station or library.”

He added: “We’re evaluating that for the 2027 budget — if it’s feasible and if Council would be amenable.”

Largely irrespective of who maintains Lawson Place, Council members agreed that the Village ought to invest more in public-owned housing.

“By any metric of evaluation, this has been a success,” Council member Senay Semere said. “As far as economic development goes, from a community level to an investment level, this has been a success. It shows that low-income housing doesn’t have to be low-quality. This is the proof.”

Council President DeVore Leonard suggested replicating these efforts elsewhere in town, provided the rentals are available for purchase and Village staff has the capacity to maintain them.

“We should keep our eyes open for other opportunities,” DeVore Leonard said. “[Lawson Place’s] rents are very affordable. There’s a reason why there is a constant desire to get in these units. It’s because of the bigger math problem: there are a lot of people who don’t make enough  money to afford higher rents.”

He added: “There could be more units in Yellow Springs owned without a motive just to profit.”

Contact: rdixon@ysnews.com