Madison developer Gorman & Company’s projects in Walker’s Point and the near south side have injected new life into central city Milwaukee neighborhoods, city officials say.
The multifamily housing developer has been active in the Milwaukee area for seven years but has increased its activity the past two years. In 2002 alone, the company completed the conversion of the Kunzelmann-Esser building at 710 W. Historic Mitchell St. into 67 loft apartments for artists and rehabilitated the 106-unit Golden Domes apartments at South Sixth Street and West Lapham Boulevard.
The company also began converting a knitting factory building at 2102 W. Pierce St. east of Mitchell Park into 100 loft apartments and is rehabilitating a 142-unit affordable apartment complex in Cudahy.
The total investment in those four projects will be $42.5 million.
Developers began to take more of an active interest in Walker’s Point after Gorman completed the Historic Fifth Ward Lofts project at 133 W. Oregon St. about two years ago, Milwaukee Mayor John Norquist said.
Gorman also has built or acquired apartments on Milwaukee’s northwest side and in Racine.
Gorman concentrates on converting historic buildings into subsidized “affordable” apartments, market-rate apartments and condominiums. Most of its condominiums are in Madison.
The company manages the project it develops, negotiates their financing and builds them with its construction division. The company was founded in 1985, employs roughly 125 people and manages about 300 apartments.
“We’ve attracted people into neighborhoods that they might not normally consider because of the value and the unique spaces,” said Tom Capp, Gorman’s executive vice president.
In Milwaukee, Gorman’s lofts can rent for as low as $800 monthly, which is considerably less than prices for condominiums or apartments in other parts of the city, he said.
At Norquist’s suggestion, the company studied artists’ live/work communities as a possible fit for the Kunzelmann-Esser building. Artists are more willing to take a chance on “transitional” neighborhoods if they offer unique spaces and the opportunity to be with other artists, Capp said.
Painter Peter Carlson, 38 said he was seeking a “second-tier city” to live in after returning to the Unite States from Portugal.
“I think this building has great potential for being in and among a working community of artists,” Carlson said.
The company usually works closely with a local government on a project, Capp said. Gorman received low-interest federal loans administered by the city to assist with the Kunzelmann-Esser and Knitting Factory projects. The company received a $625,000 loan for the Kunzelmann-Esser and a $600,000 loan for the Knitting Factory.
Gorman finances the balance of its projects with traditional mortgages.
The company entered Milwaukee with two projects on the northwest side about seven years ago. Gorman acquired a 72-unit affordable housing project. Menomonee Parkway, at North 97th Street and West Bradley Road and built a 180-unit market rate complex called Arbor Ridge at North 107th Street and Bradley.
Milwaukee is a logical market for projects that involve “repurposing” historical buildings because of its stock of older buildings, Capp said.
For the 98-unit Historic Fifty Ward Lofts project Gorman spent $13.2 million. The company used a combination of federal and state historic tax credits and federal affordable housing credits to finance the project. Sale of the tax credits generated $7.6 million equity.
Because of the affordable housing credits, about 70 percent of the units have affordable rents ranging from about $700 monthly for a one-bedroom unit to $950 for a three-bedroom. Residents generally must have an income level under the county’s median income to qualify to rent the apartments.
Gorman also redeveloped the troubled Golden Domes Apartments near Kunzelmann-Esser. Gorman bought the 1960’s-vintage complex in late 2001 for about $3.2 million and gutted the complex, added a community room and a swimming pool. The complex reopened in the summer of 2002 and is fully occupied.
The Golden Domes “is really a success story in what it does for the community,” Capp said.