It was a puzzle with no easy answer.
Two buildings from the mid-1800s — former servants' quarters and Lexington's oldest apartment house — were in such bad shape they had been condemned.
Their demolition would have left another sad gap in the historic neighborhood between downtown and Gratz Park.
Meanwhile, there is a need for affordable housing downtown for low-income people and retirees. Officials estimate that more than 8,700 households in Fayette County spend more than half of their income on rent.
With a lot of work and creative financing — such as tax credits and grants — the puzzle was solved Thursday with the dedication of First Presbyterian Church Apartments on Market Street.
The two buildings were carefully restored into a studio apartment, two one-bedroom units and seven two-bedroom apartments that will rent for between $330 and $550 a month. Tenants must have incomes below $22,700 for singles and $26,000 for families. Even before the first residents have moved in, there's a waiting list.
Not only are the apartments affordable, they're beautiful. While adding modern closets, fixtures and appliances, the developers preserved the buildings' exterior, as well as inside touches such as windows, woodwork, wooden floors and fireplace mantels.
The large project team celebrated the apartments' completion Thursday with a ceremony next door in First Presbyterian's chapel.
"This project has been both a joy and an honor," said Holly Wiedemann, a church member and president of AU Associates, which specializes in converting old buildings into affordable housing.
"It can be done," Wiedemann said. " Historic buildings can be saved. Affordable housing can be produced, and it is desperately needed."
Clyde Carpenter, a University of Kentucky architecture professor and member of the church, spoke passionately about both Christian outreach and historic preservation.
"Preservation is as much about the future as the past ... it is about environmental sustainability, not wasting, not consuming," he said.
In addition to giving historic buildings new life, Carpenter said, the apartments will add vitality to the neighborhood.
First Presbyterian, which recently restored its circa 1872 sanctuary, has played an important role in keeping the neighborhood vital. Among other things, the church restored Henry Clay's law office next door and built a magnificent contemporary chapel in the 1990s that Carpenter helped design.
First Presbyterian Apartments, Carpenter said, represents a new ministry for the church.
AU Associates led the project on the church's behalf with a big cast of characters. Financing came from Central Bank, the city, the Kentucky Heritage Council and the Kentucky Housing Corp. Design was done by S+A Architecture, with construction by Churchill McGee LLC.
Behind the scenes were many more partners, from lawyers Robert Vice and Mac Deegan to Kentucky American Water Co., which replaced water lines so old that some of them were made of wood.
"This is a model we need to replicate for other projects," Urban County Council member Diane Lawless said of the public-private partnership. "Not only is it affordable housing, it is quality affordable housing. That makes all the difference."