Gorman & Co. Opens Blue Ribbon Lofts
Those seeking affordable shelter in this city have to look no further than Gorman & Co.’s newest rehabbed project, Blue Ribbon Lofts. Part of a major redevelopment of the 21-acre former Pabst complex, Blue Ribbon Lofts is comprised of 95 unites – with 69 of them being affordable, with rents ranging from $545 to $795, and the other 26 units at market rate.
The Wisconsin Housing and Economic Development Authority (WHEDA) gave partial allocations over a two-year period – $2.5 million in low income housing tax credits in 2007 and $5 million in credits in 2008 – and provided the first mortgage debt, according to Christopher Laurent, former Gorman Wisconsin market president, who worked on the project.
“WHEDA understood the importance of getting this project done,” Laurent says. The complex, made up of 26 buildings, sat vacant since 1996 and was purchased from real estate investor Joseph Zilber in 2006. The city is providing $29 million to help redevelop the Pabst complex with the hopes of revitalizing the surrounding neighborhood.
“The desire is to capture the history but bring in the community. The creative class with local artists and entrepreneurs” is the niche market the complex is centered on, says Robyn Wolfram, executive assistant at Gorman.
With Blue Ribbon Lofts being one of the first projects to come to fruition, opening in January and 50 percent occupied by the end of April, the whole process happened just as the economy was on the downward spiral.
“The hiccup in the project was primarily the economy as opposed to the type of project,” says Ted Matkom, senior development manager and general counsel for Gorman.
When the project first came on the table, Matkom says, National City Bank was in for 100 percent of tax credit purchase but at the eleventh hour bumped down to a 49 percent buy.
“Great Lakes Capital Fund stepped up quickly,” Matkom says, buying the remaining 51 percent of credits.
The total project came in at approximately $16.2 million. It is not the first brewery Gorman has rehabbed. In 2007, Gorman opened its Gund Brewery Lofts, a $12.4 million project with 86 affordable loft apartments, including 41 created within the original historic building and another 45 in a new addition built by the developer.
But while Gorman has been able to get two rehabbed breweries off the ground, other developers in the Midwest have had a hard go at it.
Minnetonka, Minn.-based BHGDN attempted to rehab Schmidt Brewery in St. Paul, but the $200 million deal was canceled last November – the third attempt in four years to get the property sold.
And in St. Louis, two brewery projects have stalled – Falstaff and Lemp breweries, both in the Benton Park community.
“There have been a few plans touted for both the Falstaff and Lemp breweries, but none have ever gone beyond the planning stages,” says Matt Kastner of Threshold Investment Properties.