The YMCA of Greater Richmond could become a model for nonprofits seeking to gain revenue from old buildings, while keeping them in operation.

Just before Thanksgiving, the Y announced a deal that will allow the organization to continue to operate its health and fitness center at 2 W. Franklin St. in Downtown while handing over ownership of the four-story building to developers, who plan to renovate it and install apartments on the upper floors.

The Y stated that the contract also would allow the development group to purchase for residential development the parking lots the Y has assembled adjacent to the nearly 80-year-old building that fills a portion of the block bounded by Franklin, Grace, Foushee and Adams streets.

If the deal is finalized as anticipated, Y officials stated that its health center would become the centerpiece tenant in the residential complex while its headquarters offices, which currently occupy part of the building, would move to a new location that has yet to be announced.

“This partnership will enable the Y to better reflect and serve the diverse needs of the Downtown community and the community-at-large for another 80 years,” stated Abigail Farris Rogers, president and chief executive officer of the Y.

“We’re excited about how this opportunity taps into the Downtown YMCA’s history in a very modern way,” Ms. Rogers continued, noting that the upper floors once offered rooms for rent. “The location once again will offer residences alongside Y facilities and programs that build healthy spirit, mind and body.”

How much the Y stands to gain from the sale of the property has not yet been disclosed, nor have details been made public about the number of new residences to be developed.

Both parties are engaged in a quiet period of due diligence, the nonprofit stated, the final phase after three years of negotiation before the deal is recorded.

If all goes well, the buyers, who include some of the most active developers and builders in metro Richmond—George Emerson, Dennis Lynch, Tom Papa and Phil Roper—are expected to complete the purchase before the end of December and possibly begin work by next summer, the Y indicated.

The health and fitness center on the first floor is to remain open during the renovations and redevelopment of the building, according to spokesperson Lindy M. Bumgarner. Among other improvements, the Y stated the health center is to get new locker rooms and group exercise studios, along with improvements to the wellness and free-weight room.

Richmond taxpayers stand to benefit as well. As a faith-based nonprofit, the Y has long been exempt from paying real estate taxes on its property.

As a result of the sale, the property is expected to be returned to the tax rolls, with the new apartments adding additional taxable value.

According to the records of the City As- sessor’s Office, the Y’s building was most recently assessed for $1.33 million, which would have generated nearly $16,000 in real estate taxes if the Y had to pay. Collectively, the parking lots are separately valued at about $1 million, according to the assessor’s records.

The Downtown location has been in continuous use since it opened in June 1942, six months after the U.S. entry into World War II. At the time, according to the Y, it was the most modern Y in the nation.

The Richmond YMCA has been around far longer than the building. The local organization was started in 1854 at St. Paul’s Episcopal Church, 10 years after the international YMCA was launched in London. According to the Y, the local organization currently serves about 17,000 members at 17 locations in metropolitan Richmond and Petersburg and through its summer camp.