Pigtown resident and developer Lise Worthington doesn't believe in managing projects from behind a desk. She's doing business differently now and helps with the renovation work on her projects. As she said, "I'm out there in the cold and eating subs for lunch!"
And to keep money in her neighborhood, she hires mostly local workers.
"I live here and I know the problems . . .," Ms. Worthington said. "I feel strongly about spending the money here."
To rehabilitate and sell five town houses on West Ostend Street, within the shadows of the new baseball stadium, Ms. Worthington raised her own money, added some development backing from the Baltimore Community Development Financing Corp. and secured low-interest mortgage money at 5 percent from the Maryland Community Development Administration.
The five houses at 1201-1209 W. Ostend St. -- which sell for $60,000 each -- used to be single-room rentals. But they fell into disrepair and became a blight to the neighborhood.
Elmer "Doc" Godwin, president of the Southwest Community Council, said the block was an eyesore before Ms. Worthington stepped in. "We think its great that since she lives in the community, that she is also putting [something] back into the community. I would like to see 10 more of her."
Ms. Worthington bought the houses last August and began her first venture into rehabilitating to sell. (On earlier rehabs, she had retained ownership of the houses and rented them out. Her 20 rental properties in Pigtown and other sections of the city bring an average monthly rent of $400.)
Ms. Worthington reasoned that because the West Ostend Street houses have three bedrooms and 1 1/2 baths, rental prices would be too expensive for many residents of the area. She believed, however, that the houses were suitable for families who needed more room and had a stable income. And she thought that home ownership would help stabilize the community.
Ms. Worthington comes to the development business from a varied background. She previously owned Marine Nautico, a marine supplier in the Inner Harbor. After that venture, she went on to do some construction for the Henderson's Wharf apartment complex in Fells Point. Meanwhile, she earned a law degree from the University of Baltimore.
About three years ago, she bought a town house in Pigtown and rehabilitated it. About a year and a half ago, she started buying more properties. Gradually, she has started to handle more of the construction work herself.
She said she used to sit behind her desk and let someone else run the project. "This time," Ms. Worthington said, "it's 110 percent the other way."
One of the reasons for the switch: She wanted sole accountability for the project. "If the project fell through, I wanted to be the one responsible," she said.
In some of her other projects, it took months to do work that should have taken only weeks to complete, Ms. Worthington said. Although there are always unforeseen problems and delays, she said, productivity has been higher at the West Ostend Street site than at other locations.
Another change from her previous projects was the decision to hire plumbers, carpenters, sheet metal and drywall workers and painters from the community. Also, most of the building materials were bought from neighborhood suppliers.
Ms. Worthington is also active in the Southwest Community Council, an umbrella organization that encompasses several neighboring community groups.
Buyers of the five West Ostend Street houses will be referred to the Home Ownership Institute of Baltimore, a unit of the Department of Housing and Community Development. The institute was created a few years ago to help first-time homebuyers accumulate the documentation needed to apply successfully for a mortgage.
The Maryland Community Development Administration has set aside $300,000 for mortgages at 5 percent interest for the West Ostend Street project.
To qualify for CDA low-interest mortgages, an individual or couple may have an income of up to $24,300 and a minimum income of $18,511 with a reasonable amount of debt.
People with incomes from $18,511 to $19,511 will qualify for only about $51,000 in CDA mortgage money. The difference between CDA funds and the $60,000 purchase price will be offered as a second mortgage, also at 5 percent interest, by Baltimore's Community Development Financing Corp., a non-profit organization formed to finance renovation of vacant houses and development of vacant lots in Baltimore.
Ms. Worthington received most of her construction financing from CDFC at below-market rates of 9 3/4 percent and 5 percent. "We are here to do the deals that can't be done otherwise," said David Willemain, marketing director for CDFC.
Mr. Willemain pointed out that commercial construction loans at 14 percent or 15 percent are difficult to obtain in the current tight banking climate, and at those rates, a developer could not afford to rehabilitate homes in an area like Pigtown at an affordable price.