Developer Gary Gorman and the city of Madison are struggling to save an $84 million, mixed-use project seen as a major catalyst in reviving the city’s near East Side.
Although Gorman has zoning approvals for the project, he could walk away, due to a $2 million disagreement over city financial assistance.
Gorman wants to redevelop a block that now hosts a Don Miller auto dealership on the 800 block of East Washington Avenue with 309 condos in nine buildings, including a sleek, 10-story tower.
The project is important because it’s the closest to fruition in a new tax incremental financing (TIF) district along the avenue between Blair and First streets, and is seen as a major tax generator for public improvements there, including money to help relocate railroad tracks running through the site of a proposed Central Park.
On Monday afternoon, Gorman met with Mayor Dave Cieslewicz; Ald. Brenda Konkel, 2nd District; and city planners, and the sides agreed to take one more stab at somehow bridging the public financing gap.
Gorman and Co. and city staff will pursue a solution until the city’s financial committee, the Board of Estimates, meets Feb. 27.
“I feel a lot more confident that we’re on the same page,” Gorman and Co. project manager Chris Laurent said after Monday’s meeting.
Cieslewicz spokesman George Twigg said, “It’s a major project. We think it’s worth continuing the dialogue.
But without significant progress in the next week, Gorman will likely drop the project, Laurent said.
“It’s not a threat,” Laurent said. “It’s a business decision.”
The city is offering Gorman $2.2 million in TIF for a $42.5 million first phase of the project, which would have 162 condos, retail space, and 234 parking stalls. The money would help cover high costs for parking, providing lower-cost units required by city law, and property.
But Gorman wants another $2 million to help cover land costs for the $41.3 million second phase, which would provide 147 condos, more retail and 179 parking spaces.
The city doesn’t give TIF money to help developers buy land for future phases of a project that may or may not be built, city officials said.
But this case is different because Gorman and Co. must buy all the land now so Don Miller can relocate to the far East Side, Laurent said. Usually, developers don’t have to relocate a large, viable business, he said.
The project, Konkel said, will pioneer a revitalization of the East Side and the city must explore all options to save it.
“If this project doesn’t make it because we’re not willing to do the TIF investment, that’s sending a pretty strong message,” she said.