By Sheila McLaughlin
The Cincinnati Enquirer

SOUTH LEBANON - This up-and-coming community that has hosted two Homearamas in as many years is reaching into the other side of the housing spectrum.

A 176-unit apartment complex geared to low- and moderate-income residents is expected to break ground by late summer and could be open by late next year.

For Pedcor Investments, it's the second venture into Warren and Butler counties, where high-end housing developments are exploding along with commercial growth.

The Indianapolis-based company, which has built 8,000 affordable apartment units in six states, is in the midst of expanding its Knollwood Crossing development in Hamilton.

"South Lebanon, is, in my opinion, right in the growth pattern between Cincinnati and Dayton," said Bill Parrish, Pedcor's vice president of development.

"If you live in a higher-end community, you still want to have basic services amenities. Those people employed in that service sector need to have housing opportunities within that community."

Called The Cedars at Rivers Bend, the complex will be located on 12 acres off old Lebanon Road, just north of the Vista Pointe at Rivers Bend subdivision, the site of Homearama this year and last. It will be nestled in a wooded area along a hillside that borders Ohio 48, with no room to expand in the future, Mayor James Smith said.

The development will consist of nine apartment buildings, a clubhouse, playground and swimming pool, and is being financed through the sale of mortgage revenue bonds issued by the village.

Plans are to offer 80 one-bedroom units, 80 two-bedrooms, and 16 three-bedroom units, Parrish said.

Monthly rents, calculated using a percentage of the county's median income level, will range from $505 to $715 - on average about $300 less than complexes in some surrounding communities, he said.

"Council thought long and hard about putting that development in. It's in a good location. We have zero apartment complexes," Mayor Smith said. "There's a need for everybody, and we have to fulfill that need."

In recent years, South Lebanon, a village of 3,500 residents, has grown from a community of small, working-class homes to one where the average house sells for $300,000 or more. The homes being showcased at Homearama this year go for more than $1 million.

Smith said that 2,000 new homes are either planned or under construction in the village, which has already experienced a 10 percent increase in population since the beginning of the year.

His hope is that the new development will encourage the community's younger set to stay in their hometown after graduation by providing them with an affordable place to live.

So far, the proposed development has received no objection from anyone in the area, Smith said, except for Hamilton Township trustees. Pedcor recently notified township trustees of the development to meet the state's requirement for funding.

Trustees sent a letter to the Ohio Housing Finance Agency, which administers funding programs for affordable housing, saying the site couldn't support construction because it was used to dump fill dirt during the construction of Ohio 48 during the mid-1960s.

"You can't build there unless you are going to take the fill dirt out," said Trustee Clyde Baston. "Some of it is 70 feet deep."

But Parrish said engineers have tested the soil and determined the site is suitable for building. Smith questioned the township's motivation, saying the parcel of land was the focus of an annexation battle two years ago between the village and trustees. The village won out.

Either way, the township's concerns aren't likely to hold up the project, said Rita Parise, who is the state agency's director of planning, development and preservation.

"If the issue is fill dirt on a site, that by itself would probably not hold up the process," she said.

E-mail smclaughlin@enquirer.com