Yearly Archives: 2015

NEW MIXED-USE LIBRARY TO HELP REINVIGORATE MITCHELL ST.

By Bill Glauber, Milwaukee Journal Sentinal, September 2, 2015

Nancy Bush (right) helps Mixtli Murillo, 6, with a snack at an open house for people to learn about a new Milwaukee Public Library branch that will open in the historic Hills building at S. 9th St. and W. Historic Mitchell St.

MILWAUKEE – Right now, it’s just open space on the first floor of the gracious Hills building in the heart of a historic neighborhood on Milwaukee’s near south side. But by late 2016 or early 2017, there will be books, computers and furnishings in a 21st-century library that will be designed to serve as an educational and neighborhood anchor at 906-910 W. Historic Mitchell St.

On Wednesday, the public was invited to an open house to tour the site and offer suggestions for the future home of the Milwaukee Public Library branch. When completed, the Mitchell St. facility will replace the near half-century-old branch at 1432 W. Forest Home Ave.The new library is part of a trend in Milwaukee of replacing old brancheswith new ones that are part of mixed-use developments.

In mixed-use development, retail shopping is often placed on the first floor with housing on the upper floors. The city has tweaked the model by putting libraries at street level with housing above. The Mitchell St. library will be topped by 57 market-rate apartments.

“We are on the leading edge nationally of using a mixed-use model for library development,” Milwaukee Mayor Tom Barrett said.

The model — already used at the East Branch and Villard Square — enables the city to get more bang for its buck. By 2020, six Milwaukee libraries will be mixed-use facilities.

“We are really proud of the fact that at a time when resources are strapped we continue to invest in the libraries,” Barrett said.

Gorman Co. is the developer of the $10.4 million project, which includes $4.4 million in city funding for the library. The firm is applying for state and federal historic tax credits. The apartments will be designed by Quorum. Architectural firm HGA will design the new 16,000-square-foot library. There will be an attempt to blend the old with the new.

The building, constructed in 1919 as the Hills Department Store, is on the National Register of Historic Places. It retains architectural flourishes, including decorative features at the top of columns, historic stair railings and a mezzanine.

“Those are things you just can’t duplicate in a new building,” said Jane Dedering, associate vice president of HGA. Dedering said modern libraries need flexible spaces to cater to multiple uses and patrons who range from toddlers to seniors.

“Daylight is huge,” she said. “And really connecting with the community is important so it doesn’t feel generic.”

Sam McGovern-Rowen, Milwaukee’s library construction project manager, said people constantly ask “what do we need libraries for? Part of the thing we need them for is they’re town halls of the neighborhood, a gathering place, a community center.”

The Mitchell St. site sits nearby the St. Anthony School of Milwaukee and is within walking distance of South Division High School. The library will serve one of the youngest and most diverse communities in the city.

“We want the kids in this city to be using our libraries both in the summer and after school,” Barrett said.

Paula Kiely, director of the Milwaukee Public Library, said the Mitchell St. facility is “going to be a real jewel.”

Laura Gutierrez, vice president of academic affairs at St. Anthony School, said that as an educator “it’s phenomenal” to have the library coming to the new location.

“I want every resource to prepare the students academically, and resources for the workforce,” she said.

Julio Maldonado, of the Cesar Chavez Business Improvement District, said he was eager to see the library serve as a community space for everything from children doing their homework to providing an incubator for entrepreneurs.

Adam Carr, an artist who collaborated on a “Listening to Mitchell” project, said “people want something alive again” in the space.

“Mitchell Street is where the south side happened,” he said.

And a library, Carr said, is a place that can lead Mitchell St. into a new era.

HOUSING PROJECT COMING TO AVONDALE

By Emily Toepher, West Valley View, August 14, 2015

BRIAN SWANTON, Arizona market president of Gorman and Co., speaks Tuesday at the groundbreaking for Madison Heights, Avondale’s new housing project on Dysart Road and Madison Street. The project is the first in the state to take advantage of a new federal program called the Rental Assistance Demonstration program. View photo by Jordan Christopher

BRIAN SWANTON, Arizona market president of Gorman and Co., speaks Tuesday at the groundbreaking for Madison Heights, Avondale’s new housing project on Dysart Road and Madison Street. The project is the first in the state to take advantage of a new federal program called the Rental Assistance Demonstration program. View photo by Jordan Christopher

AVONDALE – A rental housing project in Avondale will increase the number of affordable units for low-income residents and be the first in Arizona to use a new federal program.

Developers broke ground Tuesday on the two-story Madison Heights project at 1103 N. Sixth St. in Avondale, which will have 143 units and should completed in December 2016. The state-of-the-art, environmentally friendly, multi-family development will replace 77 existing dilapidated units on the property, which were built in 1973 and have evaporative coolers.

“It was painfully obvious that this wonderful housing project had outlived its economic and physical usefulness,” said Mike Trailor, director of the Arizona Department of Housing. “These days, for people to be living in substandard housing with swamp coolers in Arizona when it’s 113 [degrees] is not a very good situation.”

To qualify for the housing, residents must earn at or below 60 percent of the area’s median income. The amount is adjusted by family size and a variety of other factors, but roughly equals $20,000 to $40,000 a year, said Brian Swanton, Arizona market president for Gorman and Co., one of the project’s partners.

“We don’t leave any of our citizens behind,” Avondale Mayor Kenn Weise said. “The revitalization of historic Avondale and this project really do show that Avondale is one community, one mind and one voice.”

The new housing units have varying floor plans, and the property will feature on-site amenities, including a computer lab, fitness center and multipurpose community room with free before- and after-school programming. It will also offer services such as job training, job search assistance and job placement, Trailor said.

“This isn’t just about putting a roof over people’s heads; it’s about addressing their greatest needs and helping them to overcome the fears and burdens they’ve carried with them for years,” he said. “I’m a big believer in sustainability, but in our culture, sustainability starts with having a job. So helping people get employed and helping them seek their greatest potential is a real important part of what we do.”

Several residents are still living in the current units, and will be given the option to return to the property at their same rental amount once the new buildings are complete, Swanton said. Demolition on the exiting units will start Sept. 1. Most of the residents already chose to relocate to other public housing in the last 12 to 18 months, and no new units were rented out in that time, he said.

1st to use federal program

The project is the first in Arizona to take advantage of a new federal program called the Rental Assistance Demonstration program, designed to redevelop the nation’s aging stock of public housing. It allows public housing agencies to leverage public and private debt and equity in order to reinvest in the public housing stock. The program is cost-neutral and does not increase the budget of the Department of Housing and Urban Development.

Which is particularly useful since the country currently has a $26 billion backlog of capital needs, said Ophelia Basgal, regional administrator of HUD.

“The amount of money they get on an annual basis for capital funding simply wasn’t sufficient to address this kind of backlog,” Basgal said.

Through the program, units move to a Section 8 platform with a long-term contract that, by law, must be renewed, and ensures the units remain permanently affordable to low-income households. Residents continue to pay 30 percent of their income toward the rent and maintain the same basic rights they possess in the public housing program. The RAD program has allowed local communities across the country to raise more than $989 million in new capital funding, which affected almost 18,000 units, she said.

About 170,000 affordable housing units have been lost to sale or demolition, and the backlog threatened the loss of 10,000 more units each year because of disrepair, Basgal said.

RAD started with a limit of 60,000 units, but Congress raised the cap last year to 185,000 and President Barack Obama has asked Congress to lift the cap entirely, she said. A bill currently before Congress would also reduce home funds dramatically, cutting about 93 percent or $13.3 million of funding in Arizona, Basgal said.

“When you’re here and you see what a difference it makes, it’s important to know that’s being talked about,” she said.

 

 

FREDERICK LOFTS REPRESENTS “TIPPING POINT” FOR CITY

At the dedication of 100-unit market-rate apartment building at the former Pabst Brewery, mayor hopeful for continued growth of downtown housing.

By Michael Horne, Urban Milwaukee, August 13th, 2015

MILWAUKEE - There was a time that when you referred to a city’s “Tipping Point,” you were talking about a catalytic event that led to a community’s decline. Today, the phrase, as applied to the City of Milwaukee, has a different connotation, says Mayor Tom Barrett.

“Milwaukee is at a tipping point,” he told a group of 50 people gathered Wednesday at the dedication of the Frederick Lofts, 840 W. Juneau Ave. “Not a negative tipping point, but a positive tipping point.”

The 100-unit apartment building was developed by Gorman & Company, Inc. at the east end of the former Pabst Brewery.

Prior to the purchase of the long-vacant brewery site by the Zilber Group, “there was no reason to come here,” the mayor said. In fact, the place was so desolate that “even the bad guys wouldn’t come here,” he added.

But today, “what is happening literally before our eyes are young people and the young at heart coming downtown. It’s a national phenomenon,” the mayor said. “Downtown is 3.6% of the landmass and 18% of the tax base” of the city, he said.

As if on cue, the sidewalks outside began to fill with workers from downtown office buildings as they left work, heading to their homes, some in The Brewery neighborhood itself. Gorman & Company developed the adjacent Blue Ribbon Lofts apartment building out of the former Pabst Keg House. In addition, Gorman developed the Brewhouse Inn & Suites one block west. The new development is immediately south of the Brewery Point Apartments, a senior living community.

Ald. Bob Bauman, whose 4th district represents that 18% of the city’s tax base, and is the focus of its tipping point, joked that “groundbreakings and ribbon cuttings are getting routine.”

Ted Matkom, the Wisconsin Market President for Gorman, said the site “was the poster child for blight in Milwaukee.” He recounted the failed attempt to turn the area into an entertainment district that would have required the demolition of many buildings. Such entertainment districts did not survive the great recession, he said. After that effort failed, Joe Zilber declared that the Pabst site “was going to be my legacy.”

Things were tough at first, Matkom said. Some 30 restaurateurs turned down a chance to open what is now Jackson’s Blue Ribbon Pub at the Brewhouse Inn & Suites, including what he called “all the big players.” Today, Jackson’s, run by Mark Zierath, who was in the audience (and who catered the event) “is killing it!” Matkom said. The Blue Ribbon Lofts, dating to 2008, are “100% occupied,” he said. The 90-room hotel has some of the top rates in the city,” and hopes are high for the Frederick Lofts.

As Bauman noted, the location is a success despite being in sight of the County Jail and a state secure detention facility.

John Kersey, the Zilber Group Vice President said “We would not have imagined market-rate housing when we started this thing.”

Today, market rate at the Frederick Lofts starts at $1,350 for studios and $1,790 for a two bedroom unit.

Three models were on display, and I toured them with Gary Gorman, the president of the firm that developed and owns the property. This is 100% new construction, with high-end features like granite countertops and floor-to-ceiling windows. A live-work unit of 696 square feet has a sliding partition that separates the work unit, accessible from the street, from the live unit. For those eager go-getters who like to bound out of the bedroom and straight into the kitchen for a hearty breakfast, there is no door between the two rooms to slow things down.

Gorman noted the floors of the units, which are uniform throughout, and consist of a wood-grain pattern and texture. The material is described in the sales material as “luxury hard surface plank in natural wood,” but it is a vinyl type product. Gorman says from experience, he has to replace carpets every three years, and this material should be more durable. I would rather it express its inner vinylness rather than masquerade as wood, and I found the texture to be unnecessary.

Among the attendees was Jim Haertel, who owns Best Place across the street. He now has 35 employees. His wife Nancy says their facility is nearly completely booked for 2016, including for the wedding of Urban Milwaukee CEO Jeramey Jannene and Alison Peterson and is now taking reservations for 2017. One of the couple’s favorite weddings of 2015 was that of Ald. Nik Kovac and Grace Fuhr in July, where guests arrived by bicycle. Dan McCarthy, who was instrumental in the development of the project, (and was on the wrong side of the Pabst City plan) was there as was banker Jon Mulcahy. Also in attendance was Joy Smith, a resident of the Blue Ribbon Lofts who writes a neighborhood newsletter.

The building has a nice rooftop deck with a kitchenette, and a number of people were gathered there during the event. The building has a partial green roof of sedum that looks in fine shape for a recent installation. The bioswales outside seem to have done their work during recent heavy downpours, as evidenced by the line of silt seen on some of the plants there.

The final word on the tipping point came from the mayor, who said “my wife wants to move downtown!” Barrett says that may happen soon, once the kids are out of the house.

TERRAZA DEL SOL, WESTOOD CATALYST

By John Rebchook, Denver Real Estate Watch, August 8, 2015

DENVER – A groundbreaking ceremony is scheduled for Tuesday for a $15 million, 42-unit apartment building, Terraza del Sol, which is viewed as a catalyst for Westwood, one of the poorest neighborhoods in Denver.

Gorman & Co., in its first Denver project, is developing Terraza del Sol on a 1.3 acre-site at 3116 W. Alameda Ave.

The three-story development will provide housing for those earning 30 percent to 60 percent of the area median income.

Monthly rents will range from $382 for a one-bedroom unit to $733 per month for three-bedroom units.

Qualifying renters would earn from $23,000 to $46,020 annually.

Mi Casa Resource Center, a Denver-based nonprofit that has served the community for four decades, will occupy the first floor, providing a range of educational and economic services.

“We specialize in complex public-private affordable housing partnerships in communities that are revitalizing in an equitable way,” said Kimball Crangle, Gorman’s Colorado Market President.

The City of Denver, Denver Urban Renewal Authority, Colorado Health Foundation, the Urban Land Institute and others have worked for years to bring new investment to the area

Almost a third of all of Denver’s substandard housing units are in Westwood, and 95 percent of the children in that south-central/west Denver neighborhood are eligible for free or reduced-price lunch.

Paul Lopez, the Denver City Councilman for Westwood, grew up in the neighborhood and knows what is it like to grow up poor with substandard housing.

“As a young man, my family constantly moved searching for decent, safe, and affordable housing,” Lopez said.

“Every time we moved, I had to change schools, make new friends, and the six of us would share a two-bedroom apartment,” Lopez said.

Terraza del Sol addresses social issues that have plagued Westwood, according to Lopez.

“By providing the units at Terraza del Sol, we are not only creating affordability, but sustainability in the lives of people in Westwood,” Lopez said.”

The 71,000-square-foot, energy-efficient buildings will embrace healthy living goals. Amenities will include a fitness room, interior bike storage, a large outdoor terrace with gathering and play space for families, a community lounge and media room.

Mi Casa Resource Center will open its new organizational headquarters and Family Economic and Education Center in almost 20,000 square feet in Terraza del Sol.

The space will house Mi Casa and its core partners, providing:

  • Entrepreneurial training;
  • Business counseling and micro-loans;
  • Career training, coaching and job search help;
  • Financial coaching;
  • Tax preparation;
  • English as a second language programs;
  • GED test preparation;
  • Computer literacy classes;
  • And legal consultations.

“We are excited to bring our comprehensive economic and educational services to this beautiful facility in Southwest Denver,” said Christine Márquez-Hudson, CEO and executive director of Mi Casa.

“This will enable Mi Casa to provide easier access and help more families achieve lasting economic stability,” Márquez-Hudson added.

Terraza del Sol is being financed through the Colorado Housing and Finance Authority, State of Colorado Department of Local Affairs, Denver Office of Economic Development, Denver Urban Renewal Authority, Citibank and Enterprise Community Partners, Inc.

Terraza del Sol was designed by Shopworks Architecture.The general contractor is Deneuve Construction Services. When complete, the property will be managed by the Ross Management Group.

Have a story idea or real estate tip? Contact John Rebchook at JRCHOOK@gmail.com. DenverRealEstateWatch.com is sponsored by 8z Real Estate. To read more articles by John Rebchook, subscribe to the Colorado Real Estate Journal.

NEW AFFORDABLE HOUSING GETS GOING IN DENVER’S WESTOOD NEIGHBORHOOD

Nonprofit Mi Casa Resource Center will also move its headquarters into the building

By Joe Vaccarelli, The Denver Post, August 11, 2015

DENVER – A new affordable housing development that will also house a prominent Denver nonprofit officially broke ground Tuesday in Denver’s Westwood neighborhood.

The $15 million Terraza del Sol project — developed by Gorman and Company — will bring 42 units of affordable housing to 3116 W. Alameda Ave. The ground floor will serve as the new organizational headquarters of the  Mi Casa Resource Center and include the organization’s Family Economic Education Center.

Mi Casa has served the Latino community in the Denver metro area for the past 40 years; the education center will offer services ranging from legal consultation and entrepreneurial training to GED test preparation and computer literacy classes.

“Residents are not just facing affordability, but access to good quality jobs and education and training,” Denver City Councilman Paul Lopez said. “This project brings both together.”

Mi Casa will sell its current headquarters at 360 Acoma St. The new building should be ready fall 2016.

“This is where we need to be,” Mi Casa CEO and executive director Christine Marquez-Hudson said. “This facility will serve not just families living overhead, but the entire area. I think this is a facility we envision being a catalyst for the community.”

The 42 units will provide energy-efficient one-, two- and three-bedroom apartments that are available to people earning between 30 and 60 percent of the area median income. That translates to between $23,000 and $46,020  per year. These 42 units are part of 337 affordable housing rentals that will be available in Westwood in the near future, according to Lopez.

Rents will range from $382 per month for a one-bedroom unit to $733 per month for three bedrooms. Other amenities at the development include a fitness room, indoor bike storage, media room, outdoor terrace and community room.

The project is financed by Colorado Housing and Finance Authority, State of Colorado Department of Local Affairs, Denver Office of Economic Development, Denver Urban Renewal Authority, Citibank and Enterprise Community Partners, Inc. The building was designed by Shopworks Architecture.

Joe Vaccarelli: 303-954-2396, jvaccarelli@denverpost.com or twitter.com/joe_vacc

http://www.denverpost.com/denver/ci_28622452/new-affordable-housing-gets-going-denvers-westwood-neighborhood?source=infinite

$15M APARTMENT PROJECT KICKS OFF IN WESTWOOD

By Burl Rolett, BusinessDen, August 12, 2015

A ground-breaking ceremony on Tuesday kicked off construction of a new apartment complex. Photo by Burl Rolett.

A ground-breaking ceremony on Tuesday kicked off construction of a new apartment complex. Photo by Burl Rolett.

DENVER – A new-to-Denver developer is breaking into the market with a $15 million apartment project aimed at low-income renters.

Gorman & Co. broke ground Tuesday on Terraza del Sol, a 42-unit affordable housing development at 3116 W. Alameda Ave. The project has been in the works for more than a year, Gorman’s Kimball Crangle said, and started to take shape after talks with Councilman Paul Lopez about rising housing costs in the Westwood area.

“This area has historically been one of the more affordable neighborhoods in Denver,” said Crangle, Gorman’s Colorado market president. “But even the neighborhoods that have long been affordable are starting to get more expensive.”

Plans for the $15 million development call for a mix of one-, two- and three-bedroom apartments set aside for renters making between 30 percent and 60 percent of the area median income. The project is expected to be finished by November 2016. Terraza del Sol will also house nonprofit Mi Casa, which will relocate its Baker headquarters to the development.

C:Revit14049 - Gorman Westwood14049 Grove St Apartments_steve

The 42 apartments are expected to be finished by next fall. Rendering courtesy of Gorman & Co.

Mi Casa, which offers employment services primarily to Latino families, will own a 20,000-square-foot office condo on the project’s first floor. The nonprofit’s condo will be the development’s only commercial space.

Mi Casa has been in Baker for about 13 years, but CEO Christine Marquez-Hudson said the neighborhood is “gentrifying rapidly.” Mi Casa’s headquarters at 360 Acoma St. is under contract to be sold. The deal will close, Marquez-Hudson said, when the nonprofit’s new office in Westwood is finished.

“This is really Mi Casa’s home,” she said. “This is where we need to be now and for the next 20 years and even more than that looking into the future.”

Terraza del Sol is Gorman & Co.’s first development project in Denver, Crangle said. The development firm is also working on a 70-unt affordable housing project at 71st Avenue and Federal Boulevard in Adams County.

Rooms at Terraza del Sol will rent for between $382 per month for one-bedroom units and $733 per month for the three-bedroom apartments, according to a company press release. The 71,000-square-foot building will include a fitness room, an outdoor terrace and a common lounge room.

Though the entire building will be limited to renters making less than 60 percent of the area median income, Crangle said 90 percent of the apartments will be set aside for renters at or below 50 percent.

For a single renter, 30 percent of the area median income for Denver County comes out to $16,800, according to figures released in March by the Colorado Housing and Finance Authority. A single person at 60 percent area median income would make $33,600. For a two-person household, those figures come out to $19,200 and $38,400.

The project is being financed by Citibank and Enterprise Community Partners, as well as the Denver Office of Economic Development, Colorado Housing and Finance Authority, Colorado Department of Local Affairs and the Denver Urban Renewal Authority.

The general contractor is Deneuve Construction Services, and Shopworks Architecture designed the project.

Gorman buys Amerock building in downtown Rockford

By Brian Leaf, Rockford Register Star, May 28, 2015

ROCKFORD — Gorman & Co. has completed its purchase of the Amerock building from the city of Rockford.

Under a contract approved by the Rockford City Council, Gorman paid $250,000 for the building.

The company said pre-demolition work will start within a week on the 13-story abandoned factory that Gorman intends to turn into a 160-suite hotel and conference center. It will also feature restaurants, retail space, a swimming pool, business center and a top floor cocktail lounge. Cost of the project is $67 million.

Gary Gorman, CEO of the development company that specializes in historic buildings and revitalizing urban neighborhoods, said ownership was a big step toward completion of the project.

Gorman hopes to raise about $25 million for the project from Chinese investors through an immigration program, EB-5, that provides foreigners a green card if they invest $500,000 in a project that creates at least 10 jobs. Gorman said this month that advisers in China told the company that it would be easier to recruit investors if Gorman owned the building.

The company hopes to have its financing package complete later this summer. The historic renovation of the 104-year-old building, built by William Ziock Jr. for his textile businesses, is expected to start in September.

Our View: Downtown Rockford pieces fitting together nicely

By The Editorial Board Rockford Register Star

Posted May 19, 2015 at 2:03 PM

Monday night’s Rockford City Council vote amending the development agreement with Gorman & Co. may seem like an incremental step toward downtown revival, but don’t underestimate its importance.

Aldermen not only showed confidence in the Gorman project, a $67 million hotel and conference center at the former Amerock/Ziock building, but their 11-1 vote sent a signal to other developers that they are willing to work in the best interests of all parties. Rockford is open for business.

Gary Gorman, CEO of the company that bears his name, had asked to have an option to sell Amerock/Ziock back to the city for the $250,000 he paid for it. That made aldermen nervous that he would back out. So, the deal changed. Now, Gorman will sell the building back to the city for $1 if the project is scrapped.

The worst-case scenario would be that the city resumes ownership of a partially cleaned-up Amerock/Ziock with $250,000 in its coffers.

That’s unlikely, and Gorman sounded confident Monday when he said: “This project is going to happen.”

Gorman is expected to close on the building Wednesday and with that move he will have spent more than $1 million on the project. That’s a huge commitment and doesn’t account for staff time that’s gone into the development.

The buzz about downtown Rockford has never been greater. Gorman is the biggest piece of the revival puzzle, but there are plenty of pieces in place with undoubtedly more to come.

Work on the downtown sports complex, another huge puzzle piece, is progressing well, and the Rockford City Market pavilion looks very good as the market prepares to open its sixth season Friday.

The market has been a catalyst for downtown development. It has shown that people will come to downtown Rockford regularly if you give them a good reason. The market set a record for attendance in 2014 with 75,500 visitors, an amazing number when you consider there were quite a few Fridays with unpleasant weather last year.

This year the pavilion will protect market visitors from the elements, so we expect a new record.

Several small-business owners started at the market and have opened stores downtown.There still are plenty of empty storefronts downtown for aspiring entrepreneurs. As projects such as Gorman’s and the sports complex take shape, those empty spaces will become more desirable.

We can’t remember a time when so many reputable developers were interested in the center of the city. Urban Equity Properties, led by Justin Fern, plans a $10 million development in the 50,000-square-foot Hanley building and is working on other downtown properties.

Morgan Management wants to turn the Rockford Trust Building into 62 downtown apartments, with space for retail and service businesses on the ground floor. The price is nearly $13 million.

Joseph James Partners, led by SupplyCore CEO Peter Provenzano, and Frantz Community Investors of Cedar Rapids, Iowa, also are looking for downtown opportunities.

You can feel the momentum build from our offices here in the downtown News Tower. There has been significant private investment in an area that had seen mostly public dollars spent on it.Downtown Rockford finally appears ready to live up to its potential. Years from now, we will be able to look back at Monday night’s vote as a vital step in the process.

Amerock Project Closer to Being Finalized

By Phillip Reed, MyState.com, May 19, 2015

Rockford-The vacant dilapidated Amerock building sits with broken windows in downtown Rockford waiting on aldermen and developer Gary Gorman  to reach an agreement on a purchase of the property to turn it into a hotel. 

Gorman says “(The Amerock) project is going to happen. We have to explore the risk, we have to explore the ‘what if’ scenarios.” 

That’s why Gorman asked for some amendments to the proposed deal with Rockford. The developer wants more then 500,000 dollars waived in fees for permits and utilities, in exchange for hiring local contractors. Aldermen voted yes on that proposal during Monday night’s city council. 

Gorman says “We will do that. That’s part of the trade off, for the waiver of the fees. But the bigger point in the waiver of the fees is we want to put money in the quality of the hotel.” 

Gorman also wanted an option to sell the Amerock back to Rockford for 250,000 dollars. Aldermen were not in favor of that, saying that would be unfair to taxpayers. They changed the amendment to make any sale back to the city cost one dollar. Gorman did not have any objections to the decision. 

He says “Worse case scenario for the city of Rockford, they keep my 250,000 dollars, they will have the building back that they own now, and it will at least be partially remediated because we’re going to start work on it with the month of June.” 

Gorman says he’s confident in the city of Rockford and the Amerock project. He adds, “On 31 years (my company has) never started a project and not completed it, so that’s just not gonna happen.”

Gary Gorman says he’s committed to hotel project in downtown Rockford

By Brian Leaf Rockford Register Star

Posted May 17, 2015 at 12:00 PM Updated May 17, 2015 at 8:45 PM

ROCKFORD — Gary Gorman asked for an audit on how much his company has invested into the vacant, asbestos-filled Amerock/Ziock building that he wants to turn into a $67 million Embassy Suites hotel and conference center.

The accountant’s report: $760,418.16, said Gorman, CEO of the Wisconsin-based company that bears his name. That’s what he’ll lose if the project dies.

That investment, which doesn’t include $75,000 to apply for a hotel franchise and staff time put into the project since 2012, will surpass $1 million Wednesday if, as expected, Gorman buys the property from the city of Rockford for $250,000.

“The concern I’ve heard is that Gorman is not committed to this,” he said. “I just smile when I hear this.”

But worried frowns and questions about Gorman’s commitment rose last week when aldermen considered changes to the company’s development plan. Those changes include a city waiver of $550,000 in fees for permits and utilities, a $3 million federal loan backed by the city and an option to sell the building back to the city for $250,000.

The City Council is expected to consider the changes Monday.Aldermen have questioned whether the changes to Gorman’s development plan are a sign that the deal, which relies on $25 million from Chinese investors, is “imploding,” as Ald. Frank Beach, R-10, put it.

Hardly, said Gorman, who has 30 years of putting together development deals and says they are prone to challenges and change.

“The real key in getting a project done is persistence, pounding away at it until it comes together,” he said. “And I’m betting an awful lot that (Amerock) will.”

So are taxpayers.

The Amerock deal has many parts. It relies on $16 million in city infrastructure investments; development of the $24 million Ingersoll indoor sports center; state and federal historic tax credits; EB-5, an immigration program that gives foreigners a green card for investing $500,000 in job-creating projects; a bridge loan for construction; approval of a hotel brand; and tight construction deadlines.

“This is a lot more complex than the average redevelopment deal that we have worked on,” said Mayor Larry Morrissey, who expects the amendments to be approved Monday.

Gorman Illinois Market President André Blakley met with aldermen last week to address their concerns and questions about the hotel project.

One question centered on why Gorman needs an option for the city to buy back the Amerock building for $250,000. The answer is EB-5, which Gorman hopes will help it raise $25 million from investors in China.

Gorman said he hadn’t anticipated buying the building until later this year, when what developers call the “financial stack” is in place: all of the financial elements — such as equity, loans, tax credits and outside investments — needed to finish a project