GRAND RAPIDS, MICH.—Before Verne Barry could help others, he had to rehabilitate himself. He recovered from bouts of alcoholism and homelessness to become a leading homeless advocate and founded Faith, Inc., a local nonprofit that offers job training and employment to low-income and homeless people.

For decades, three crumbling downtown single-room occupancy (SRO) buildings have also needed to be fixed. In June, workers finished the rehabilitation of Verne Barry Place, a community that provides permanent housing and services to dozens of area veterans and other special-needs residents with mental health or substance abuse issues. The 116-unit project, including 44 apartments in three hotel buildings that are more than a century old, is designed to win a Leadership in Energy and Environmental Design (LEED) certification from the U.S. Green Building Council (USGBC).

That certification is an important seal of quality for the once-ramshackle hotel buildings: It helps show how far they have come, says Dennis Sturtevant, CEO of local nonprofit affordable housing developer Dwelling Place.

The energy-efficient apartments have excellent indoor air quality, conserve water, and are topped with a green roof, according to the developer's application to the USGBC. The 300- to 450-squarefoot studios are also built as tight as a drum to keep out drafts and bugs.

Before the rehab, which gutted the three-story buildings and created a new five-story addition on a parking lot next door, Dwelling Place operated 88 SRO units on the site. “These were the buildings I did not take people on tours of,” notes Sturtevant.

The developer bought the hotels in 1982 and rehabilitated them as best it could. It was one of the state's first affordable housing projects built with federal low-income housing tax credits (LIHTCs), back when investors paid less than $0.50 on the dollar for credits. “The numbers didn't work. ”¦ You weren't able to do the kind of renovation you should have,” explains Sturtevant.

Though the project always passed muster at inspections, the old hotels were a maze of winding hallways and tiny rooms that started as small as 120 square feet. The old buildings were also riddled with cracks and crevices that made it difficult to keep out pests.

Most of the money used to fund the $19.4 million redevelopment came from the $13.5 million sale of LIHTCs to the National Equity Fund, Inc., along with $2.4 million in state and city HOME funds. The project also received grants from the Federal Home Loan Bank's Affordable Housing Program and the Department of Housing and Urban Development's Supportive Housing Program. A mix of state tax credits, deferred developer fees, money from the community's reserves, and $1.3 million in grants from 15 different foundations made up the rest of the financing.

Committing to meet tough green building standards helped Dwellling Place win funding, says Sturtevant. Steel Case Foundation gave $300,000 to the project and has promised to increase that gift by 10 percent, or $30,000, once the community achieves LEED certification.

To bring new activity downtown, the community also includes nine live-work spaces that combine residences with commercial storefronts. Verne Barry Place remains the home of service provider Faith, Inc., where Barry had his office until his death in 2004.