Evening star., 1940-03-30
Properly Owners
Realize Big Profits
In Modernization
. Uneconomic Eyesores
Turned Into Profitable
Investments

Investments
Americas city property owners
are learning lesson on where t
look for buried treasure"
Alert owners are finding money
bags literally buried in their owr
back yards. The treasures are be.
ing unearthed by the simple method
OF remodeling rundown, obsolete
buildings and Transforming them
into attractive business getting
properties
Success stories are coming from
those who have learned how mod
ernlzation has turned uneconomie
neighborhood eyesores into profit.
able investments.
Paul L. McCord, Indianapolis
realtor- builder. recently said: 81
have found it more profitable to re.
habilitate and market existing
houses than to build new ones"
In the past three years. he has
rehabilitated. reconditioned, ano
disposed of about 400 homes at a
price satisfactory to both himself
and his clients.
In cleveland, surveys made by
Edgar L. Ostendorf, past president
of the National Association of Real
Estate Boards, show graphically the
value of modernization in bringing
building incomes back up to profit
able levels.
Revived NeighbOrhood.
Spurred by a study of buildings
on secondary street in his city
which showed rentals in recent
years had deprecated as much as
81 per cent, Mr.. Ostendorf traced
the effects of modernization on an
other group of buildings along
Cleveland's Euclid avenue. He
learned that after the buildings
were remodeled, it changed the en-
tire atmosphere of the neighbor-
hood and rentals commensurate
with the high returns of the '20s
were again realized
He watched similar face-lifting
project on single building in the
same area. He found that a new
front and modernized interior, along
with proper real estate management
increased rentals from $4,000 a year
to from $4,000 to $4,000.
Dressing up store fronts and in
teriors is going long way toward
complete rehabilitation of poten-
tally valuable properties" stated Mr..
Ostendorf. "A little building face
lifting-with bright. colorful glass,
cleaning metals and other modern
dress-up materials-Will soon pay for
Its cost by increased business re-
sulting in a greater rental and net
return for the property. Beyond
that such modernization will add a
new note of prosperity to the neigh
horhood and give impetus to a move
for complete renovation of the area -
Stores Boosted Profits.
A group of Is small grocery stores
kept a careful accounting of income
and profits before and after mod
ernization of their stores. Net prof.
its rose an average of 300 per cent
after modernization. from $547 to
$2,032 One owner said: The re-
modelling costs were paid for out of
the increase in profits during the
first year"
In Philadelphia one owner re-
modelled five dilapidated downtown
buildings. Unable to maintain ade-
uuately the properties as they we're
he became convinced that the only
way he could get more-and more
suitable-tenants was through mod
ernization. New tenants came in at
higher rentals, resulting in a 30 per
cent increase in the buildings in
come
In Louisville, KY. income from q
downtown building started sliding in
the 1930s and hit bottom in 1886.
A rehabilitation program was under
taken and Immediately the earn
lngs curve started sharply upward.
For the last three years the gross
income has equaled. even exceeded.
that of 1927. the first full year of
operation
Rehabilitation of residential areas
are producing like results. The
owners of 1900 homes in the
Waverlv district of Baltimore have
launched community program de-
scrihed AS "a pioneer experiment in
co-opera tive city rebuilding." One
Of the first owners TO "face-lift" a
home was able to increase the
houses rent from $25 to $50 a month.
Realtors Support Movement.
Active support of this growing
rehabilitation movement is being
given by the National Association
of Real Estate Boards. The Urban
Land Institute, independent re-
search and advisory agency, initially
sponsored by the association. is lend
ing hand to help cities set up long
range plans aimed at eliminating
rundown districts. Urged for each
city are careful studies of popula-
ton shifts, traffic and parking prob
lens, congestion within the district
and "conf1scatory taxes"
In explaining the association s