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Developer drops downtown Madison residential project

By Paul Snyder

A developer is killing a downtown Madison housing proposal, freeing up a property in a historic district with a reputation for challenging developers.

Tom Sather, president of Silverstone Partners Inc., said he will not proceed with a project proposed last year that would put a five-story, 46-unit affordable housing project on the site of the Holy Redeemer Catholic Church.

“Every time a project doesn’t work out it’s disappointing,” he said. “It’s a fabulous site and someday in the future, it will work. It’s just not in the cards for us right now.”

The project’s development team was unable to meet the March 26 application deadline for Wisconsin Housing and Economic Development Authority tax credits for the apartments. Sather said more financing issues loomed when city staff redesigned the State Street tax incremental financing district to accommodate the proposed Edgewater Hotel redevelopment project and left out the Holy Redeemer site.

TIF districts let municipalities borrow money to subsidize developments and pay for utility and street work that serves projects. Communities then use new taxes generated by the projects to pay off the debt. Sather said the housing project needs TIF to work.

Don Marx, manager in Madison’s Office of Real Estate Services, said Silverstone never approached the city about TIF or more amendments to the city’s district. He said city staff is open to discussing TIF for Silverstone’s or others’ projects.

But the neighborhood, not the TIF issue, is keeping other developers away.

“Land’s in play there, but it’s in a local historic district,” said Madison developer Curt Brink. “And the biggest deterrent for any developer there is if the Landmarks Commission says no, you need 14 (Common Council) votes to overturn it.”

The housing project would have been built in the Mansion Hill Historic District. The city’s Landmarks Commission reviewed the proposal in November, but refused it a certificate of appropriateness until the designers made a number of alterations, including increasing space between the building and the church sanctuary, redesigning the exterior facing Gorham Street to make it similar to other buildings on the street and reducing the building’s size.

Brink said those kinds of changes go too far.

“If he was trying to tear down or do damage to the church, I would understand it,” he said. “But we’re dealing with a parking lot. That area should be high density, but if the Landmarks Commission or the district residents don’t like it, that’s it.”

Brink and Brad Binkowski, principal for Madison-based development firm Urban Land Interests Inc., tried pushing new mixed-use projects with residential units in Madison historic districts to no avail.

Four years ago, Binkowski said, Mansion Hill residents’ opposition to his project, a six-story mixed-use project at 222 W. Gorham St., was similar to what now dogs the proposed Edgewater redevelopment.

“We invested time and money to make that project work,” he said. “Why would I go through that again? The brain damage isn’t worth it.”

Mansion Hill Historic District Chairman Gene Devitt was unavailable for comment.

After the Landmarks Commission’s rejection of the Edgewater project in November, Madison Mayor Dave Cieslewicz directed a rewrite of the city’s landmarks ordinance to make it less restrictive. The commission is still working on recommendations.

Sather said the parking lot site would be great for a housing project. It provides easy walking access to anywhere downtown, he said.

“We targeted the people who make $8 to $12 an hour,” he said. “We would’ve had no trouble filling it up.”

That option can be there for other developers now, but until the city loosens its project restrictions on Madison historic districts, Brink said developers are unlikely to consider it.

“Basically you say, ‘Forget it,'” Brink said. “And until this thing changes, downtown is dead.”

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