Evening star., 1934-11-29
[OW-COST HOUSING
YIELDS DIVIDENDS
81 Years of Experimental
Investment Successful
for 2 Firms Here.


housing by recent attempts of Com
missioner George E. Allen to under
take a housing project with F. E. r. A..
funds recalls the fact that building
of low-cost housing has been going
on successfully here for 81 years.
There are two private corporations
In this field, the Washington Sanitary
Improvement Co., founded in 1891,
and the Washington Sanitary Hous-
ing Co.. founded in 1904, and they
have built and are renting between
958 apartments, 539 for whites ana
4l9 for colored persons. .
Subscribers to the stock In these
companies at the beginning. in many
instances, did not expect any return
on their money, investing it as charl-
table enterprise, primarily to RID the
city of tuberculosis breeding Sums
The history of the enterprises, now
ever, is that they have paid ana D
per cent, respectively, on their STOCK
for years.
Average s1S.16 Per Month.
What these companies mean by
Glow cost" in terms of rent, may
be shown by rentals on block OF
lO8 apartments for colored persons
Rentals are for two rooms ana patn,
s12 30 per month: three rooms ana
hath from $3.50 to $2l per month.
ONLY three of the apartments rent
at the highest figure mentioned. Tne
average figure for three-room apart
ments is s18l6 The particular block
is owned by the Washington SAM
tary Housing Co.
Similar figures obtain for the other
company. The most recent venture
into the low-cost housing field IN
yades the realm of the poorly PAID
hite-collar worker. A group OF IA
apartment buildings with Sc units
has Just been finished at Trinidad
avenue and Raum street northeast
The apartments form hollow square
the interior being Handicapped play
ground. These apartments rent for
$3.50 I'D to S44 per month. For the
higher figure the renter gets SIX
room apartment. These apartments
are heated by oil and have electric
refrigeration and gas for cooking.
Water is included in the rent. but the
tenant pays for the gas and electricity
used.
This development was expert
mental but before the apartments
were ready there were more than 300
applicants for the Sc available apart
ments.
Cheaper Units PredOminate.
But the cheaper units. which pre-
dominate. are principally two-story
apartments ranging in size from two
rooms and bath to five rooms and
bath. Each apartment has its own
front door and rear exit. The build
lngs are of brick, with large rear
porches. The earlier buildings had
wood stoves 1t was found that this
tended to litter up the premises with
various bits of scrap lumber. The
more recent units have two gas
heatrolas per apartment. There is
gas for cooking and heating water.
The company also supplies radio
aerials on the apartment roofs.
The finances of the companies
present an interesting picture. IN
view of recent discussions of the need
for amortizing capital investments in
low-cost housing over periods Of so
years. Neither company has any
amortization period. They started
operation with cash subscribed for
stock Ever since then their oper-
stions have been. substantially, to in
vest profits above dividend and sur
plus requirements in new housing
ventures While the cash is accumu-
lating the companies usually invest it
in real estate notes. If the notes are
not readily to be liquidated when it is
decided to undertake new construc-
ton. the companies open credit at
a bank. Such was the case when it
was decided to build the group OF
buildings at Raum street and Trini-
dad avenue. Arrangements were made
to borrow 100000 against collateral
security The full amount was never
borrowed, and the balance on the
original debt has already been re-
duced to approximately $4,000. No
mortgage was ever put on the prop
erty.
Price of Land Varies.
For the apartment buildings, the
companies buy land ranging in price
from 12c to soc per square foot. The
12c price, however, did not include
all improvements, such as sidewalks,
curbs and cutters.
Construction costs have ranged
from IL cents per cubic foot to 208
cents per cubic foot. Depreciation
is charged against the building at
the rate of 2l2 per cent per annum,
although originally the charge was 2
per cent.
Those who originally subscribed to
stock in these companies did so from
charitable motives. 1t was intended
to decrease alley population and fight
the tuberculosis rate with cheap but
we'll = built and efficiently managed
housing properties. A recent finan-
cial statement, however, shows that
the Washington Sanitary Improve
ment Co. had assets of 81 1,409 ,844.61.
The capital stock was s5oO,OoO. re-
serve for depreciation, $451 ,200.22,
and surplus, S458, ,44439. This COM
pany paid per cent dividends from
the start until 1923, when the rate
was raised to g. The per cent has
been paid throughout the depres-
sion.
The Washington Sanitary Housing
Co. has net assets of 1856, $1,000. Its
capital stock was 100000, the reserve
for depreciation, S73, ,536. and its sur
plus, S88 1863. For the first three
years of its existence, this company
paid per cent dividends, and it