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The refurbishment of public residential districts represents a current and complex problem. The Cappuccinelli Social Housing (SH) district in Trapani, designed in the late 1950s by Michele Valori and built during the 1960s, is emblematic of the architectural quality and technological innovation of the time it was designed, but at the same time represents the physical and social decay that occurred just after its construction. The neighborhood was examined through a combination of inspections and documentary research. The inspections were conducted for the entire district in order to identify the recurrent external degradation of building components and the related causes, both physical and anthropogenic. This paper investigates the physical–mechanical degradation and problems connected to previous renovation work in this district. Furthermore, technological design solutions are discussed for deep renovation and energy efficiency improvement of one of the terraced buildings of the Cappuccinelli SH district.