New buyer, same spirit
5th Ward investor eyes preservation, not gentrification
On a February afternoon, Christopher Senegal, a railroad consultant turned real estate developer, was taking a stroll through a quiet cluster of Fifth Ward homes when a voice called to him from across the street.
“How’re you doing? Are you the new landlord?”
Senegal was not the new landlord, but he intended to be. He looked around for the stranger who had somehow
divined that intention and saw Linda Robertson, an at-home caregiver who lived in the neighborhood, who introduced herself and began making small talk about the properties. She knew the people there, knew they were good tenants, not about to move anywhere.
And, she said, she knew the people living there — some for as long as 30 years — could afford current rents. “These people already know what the rent is. So they’re already familiar with it. So if I were you, I would keep it like that.”
Senegal, who later acquired the collection of 18 homes, is one of an increasing number of investors who has seen value in close-in, low-income neighborhoods where minorities and industry were relegated in the city’s early days. These investors are often a catalyst of gentrification, pricing out longtime residents and altering the character of the community.
But Senegal has set out to prove such displacement is not inevitable. He believes he can generate a profit without raising rents or scrapping homes to build townhouses. He planned to start in Fifth Ward, where Census Bureau data shows 39 percent of the population is living in poverty. Home values there have risen 27 percent over the past year, according to Zillow.
He told Robertson he would keep rents as they were.
“With these people here, you don’t have to worry about nothing,” she said. “Just don’t let nobody bring no townhouses up in here. Don’t bring that here.”
“Yes, ma’am.”
‘Naturally affordable’
Senegal’s plan for the homes, roughly 600 square feet apiece and leased for between $550 and $700 a month, was to buy them as part of a package deal. The collection also included an empty storefront on the corner of Lyons Avenue, which he intended to convert to a restaurant with a rooftop terrace, and an empty house, which would be restored and turned to offices. The existing cash flow from the rentals was enough to cover monthly costs. The two vacant properties would give him room to increase profits without affecting current tenants.
By July 10, Senegal had secured crowdfunded financing and closed on the purchase of the residences, known as Dittman Court.
Built in 1925, Dittman Court has held its own since before a federal policy known as redlining prevented banks from lending money to invest in the neighborhood. It was there before U.S. 59 and I-10 split the neighborhood and its then-thriving Lyons Avenue, home to more than 40 Blackowned businesses.
It’s been there long enough for generations to establish roots within its homes.
“Thank God for it,” said Dorris Taylor, 72, of the one-bedroom home where she’s lived half her life. Her son’s childhood stuffed animals still perch on the living room sofa, and mementos from his days as a star basketball player at New Mexico State University decorate the walls. “It doesn’t do me any good to pick up and move, because I don’t know where I’d go.”
The complex’s age and lack of high-end updates, coupled with a history of disinvestment in the surrounding neighborhood, have made the homes part of what’s known as naturally occurring affordable housing. Such housing is under threat: In a recent study on the state of housing in Houston, Rice University’s Kinder Institute for Urban Research found the city’s supply of low-cost units was quickly diminishing.
Housing that is in increasingly short supply and high demand, such as affordably priced units within minutes of downtown, tends to go up in price.
“Developers are seeing opportunities with existing so-called naturally occurring affordable housing — saying, ‘Oh, if I came in and I put in some new appliances and changed the lobby furniture and did a little bit of cosmetics, I could push the rent up — because the new supply’s not there,’ ” Chris Herbert, managing director of the Joint Center for Housing Studies at Harvard University, said in a discussion of the Kinder Institute findings.
Unless the pandemic drastically damages the demand for housing inside Loop 610, preserving naturally occurring affordable housing will require intention, he said. “(We need) to make sure there’s ways to get basic housing — ’70s, ’80s garden apartments — into the hands of people who want to maintain it as affordable for a long time,” Herbert said.
In Senegal’s words: “People talk about gentrification. You can either be frustrated that it’s happening, or you can participate and help control it.”
‘Hold your community down’
One of the words many Dittman Court residents used to describe their complex was “peaceful.”
“You’ve got a peace of mind,” said Robert Bonet, a 65-year-old air-conditioner repairman with an engaging smile. “I even leave my car open.”
That, in part, is because neighbors know one another and keep an eye out for unfamiliar people and vehicles. In fact, Robertson said she guessed Senegal may become Dittman Court’s new landlord because she saw him talking with Kendrick Stevens, the property manager who lives on the block and whose family owned the site.
Stevens’ grandparents, Frank Adams, a former sharecropper turned barber, and Hester Adams, a housekeeper, bought the property in 1976. The seller, a doctor named Samuel Dittman, knew the family because Adams’ barbershop was in the storefront Senegal is now converting to a restaurant, and he often helped the families who lived behind his shop make repairs to their homes. Dittman asked if the Adamses wanted to take over the property, offering them owner financing. They did, and they managed it themselves for three decades.
But not all new landlords had the same ties to the community or attitudes about keeping it up. As an example, Stevens pointed to the site of the former laundromat adjacent to the properties Senegal purchased. Stevens had childhood memories of the place but said when the owner died, it was purchased by an investor who boarded it up and waited for values to rise. Now the laundromat sits empty behind a chain-link fence strewn with cigarillo wrappers and Styrofoam cups.
“That was a part of Fifth Ward that everyone knew,” Stevens said. “It’s gone. When I say people take from the community, that’s what I mean. So now it becomes a dumping ground for trash, debris> … You allowed that to happen. If you purchase it, do something with it. Occupy it. Put life in there — it builds the community, and that trash leaves. But a lot of our investors and people who have bought (Fifth Ward), they haven’t done that. They’re waiting: ‘How long do you think it’s going to take for downtown to move this way?’ ”
Stevens said he had sized up Senegal’s intentions before allowing the sale. “I asked Chris: Do right by my people. These are my people. It’s not how many restaurants you put up. It’s not how many homes you put up. It’s what did you save.”
Now that Senegal bought Dittman Court and followed through on his word, replacing roofs, repairing flooring and adding sunscreens to windows to reduce utility costs — all without raising the rent — he hopes other local landlords will be inclined to sell him similar pockets of low-rent housing. He is in conversations with a handful of landlords in the area, as well as the owner of the abandoned laundromat.
Senegal raised the funds to purchase Dittman Courts through crowdfunding on his site, Buy the Block, and intends to do the same on future projects. The strategy has a two benefits: It allows entrepreneurs of color who may not have enough money to buy real estate themselves to purchase a stake in the properties for as little as $250. Twice a year, Senegal pays dividends to the investors he says amounts to a return of between 2 percent and 3 percent.
“Just hold your community down,” Robertson repeated, before saying goodbye to Senegal.
“Yes ma’am,” he replied. “That’s what I’m doing.”