Affordable Housing Finance

Gorman & Company Begins 7th Phase of Milwaukee Northside Housing Initiative

Tax Credit Advisor, January 2015

In early October Gorman & Company broke ground in Milwaukee on the 7th phase of its nationally-acclaimed scattered site, single family home redevelopment.

Gorman & Company’s Northside Housing Initiative is a partnership with the City of Milwaukee and the Wisconsin Housing and Economic Development Authority (WHEDA). Its goal is to resuscitate challenged neighborhoods that have been devastated by the foreclosure crisis. Foreclosed, boarded-up properties are rehabbed into high-quality rental housing. In addition, newly constructed homes are built on vacant lots that residents consider the “broken teeth” of their neighborhood.

This innovated housing initiative also focuses on training  chronically unemployed people from the affected zip codes. The City of Milwaukee offers critical support for the project by assembling the individual properties and contributing them to the initiative.

From Foreclosures, Affordable Housing

Affordable Housing Finance, 2014 LIHTC Yearbook

A Wisconsin developer’s large-scale initiative in neighborhoods on Milwaukee’s North Side is helping reverse the damage of the Great Recession and foreclosure crisis.  By purchasing vacant lots and foreclosed homes from the city, Gorman & Co. has aided in neighborhood revitalization, homeownership opportunities, and job creation.

Over the course of seven phases, the developer built or rehabbed 282 single-family homes or duplexes affordable to residents earning between 30 percent and 60 percent of the area median income.

“All of those homes that we redeveloped within the neighborhoods are in a high demand because people in this day and age really find it hard to own a home but want the space of a home to raise a family,” says Ted Matkom, Wisconsin market president for Gorman & Co.

Gorman refurbished the homes, many of which date back to the early 1900s, with modern amenities, appliances and security systems.  “You literally get a new home, in a sense, when you move in,” Matkom says.

After the 15-year compliance period, residents living within the single-family homes will have the opportunity to purchase them for the remaining debt, which is projected to be approximately $35,000.

The acquisition and rehabilitation work also has provided a needed jobs boost in the city.  Gorman partnered with nonprofit Northcott Neighborhood House to create a training program for chronically unemployed local residents with challenged backgrounds.  Through the program, men and women were trained to do construction trade work and demolition work.

Low-income housing tax credits (LIHTCs) were vital to the developer’s work.  The $56.6 million initiative was financed with $44.1 million in LIHTC equity.  Additional financing included Neighborhood Stabilization Program funds from the city of Milwaukee.

“The LIHTC program really makes the housing sustainable for years to come,” says Matkom.  “And it really revitalizes the housing stock with minimal subsidy.”

Developer Helps to Transform Milwaukee Neighborhoods

By Christine Serlin, Affordable Housing Finance

A Wisconsin developer’s large-scale initiative in neighborhoods on Milwaukee’s North Side is helping to reverse the damage of the Great Recession and foreclosure crisis.

By purchasing vacant lots and foreclosed homes from the city, Gorman & Co.’s work is resulting in neighborhood revitalization, homeownership opportunities, and job creation.

Over the course of seven phases, the developer built or rehabbed 282 single-family homes or duplexes affordable to residents earning between 30 percent and 60 percent of the area median income.

“All of those homes that we redeveloped within the neighborhoods are in high demand because people in this day and age really find it hard to own a home but want the space of a home to raise a family,” says Ted Matkom, Wisconsin market president for Gorman & Co.

Gorman refurbished the homes, many of which date back to the early 1900s, with modern amenities, appliances, and security systems. “You literally get a new home in a sense when you move in,” Matkom says.

After the 15-year compliance period, residents living within the single-family homes will have the opportunity to purchase those homes for the remaining debt, which is projected to be approximately $35,000.

Residents must sign a contract of care, which promises that they will maintain the home with ordinary upkeep, such as mowing the grass, shoveling snow from the walkways, and doing minor repairs. This helps to instill homeownership responsibilities in the residents and helps to reduce Gorman’s operating costs since it’s a scattered-site project over a three-mile diameter, says Matkom.

The acquisition and rehabilitation work also has provided a needed jobs boost in the city. Gorman partnered with nonprofit Northcott Neighborhood House to create a training program for chronically unemployed local residents with challenged backgrounds. Men and women were trained to do construction trade work and demolition work.

Low-income housing tax credits (LIHTCs) were vital to the developer’s work. The $56.6 million seven-phase initiative was financed with $44.1 million in LIHTC equity provided by Alliant Capital, Boston Capital, and National Equity Fund. Additional financing included Neighborhood Stabilization Program funds from the city of Milwaukee.

“The LIHTC program really makes the housing sustainable for years to come,” says Matkom. “And it really revitalizes the housing stock with minimal subsidy.”

The AHF 50: Top 50 Affordable Housing Developers, #29 Gorman & Company, Inc.

By Christine Serlin, Affordable Housing Finance, April/May 2014

#29, Gorman & Company, Inc.

Gorman and Co., based in Oregon, Wis., isn’t just a housing developer.  The company considers itself a community developer, too, building in revitalizing areas in Arizona, Florida, Illinois, and its home state.  One of Gorman’s major accomplishments for 2013 was finding new sources of financing for that work.

“We have to be prepared if there are real jolts to traditional funding, like low-income housing tax credits (LIHTCs) or historic tax credits,” says COO Tom Capp.  “That’s a bit of the motivation why we’re looking at new sources.”

The firm has had recent success with the government’s EB-5 program, which offers foreign citizens a Green Card if they’ll invest $1 million in an American project that creates or preserves jobs primarily in community development areas.

Gorman is redeveloping the Pabst Brewery site in Milwaukee with three projects.  The first was Blue Ribbon Lofts, 100 affordable units financed with LIHTCs and historic tax credits.  The second was a historic hotel and restaurant, where the company utilized the EB-5 investments.  The third will be market-rate workforce housing with equity from a Chinese developer.

“These financial sources are fueling projects like workforce housing and elements communities want to see us executing in the revitalizing areas,” says Capp.  “These sources are touching housing, but not intermingling with the LIHTC.”

The firm has also received approval from HUD’s Rental Assistance Demonstration program for a 300-unit public housing development in Phoenix.

Gorman & Company, Inc. Named in the Top 50 Affordable Housing Developers of 2013

April 10, 2014

Affordable Housing Finance named Gorman & Company, Inc. in the top 50 affordable housing developers for 2013.