Two Milwaukee projects could get tax increment financing from city

Two housing projects could benefit from a proposed tax increment district in the city of Milwaukee.

The city of Milwaukee Department of City Development on Wednesday announced two tax increment districts for a project that will renovate a foreclosed commercial building on Dr. Martin Luther King Jr. Drive and another that will adapt an underused office building in downtown Milwaukee. The projects include workforce and affordable housing units.

The Redevelopment Authority of the City of Milwaukee will hold a public hearing for the creation of TID 127 for 100 East Wisconsin and TID 128 for Compass Lofts. The public hearing is scheduled for 1:30 p.m. on July 17 at 809 N. Broadway. in Milwaukee.

The city proposed a $14.4 million investment to support a plan to redevelop the 100 East building, which will convert the office building into 373 new units, DCD officials said. Included are 75 workforce housing units for those earning equal or less than the city’s area median income, officials said.

The total estimated development cost is around $165 million, officials noted.

“A thriving downtown is essential to Milwaukee’s stability and growth,” said Alderman Robert Bauman, who oversees the 4th District, in a statement. “I am pleased to support a project that revitalizes an important landmark in the heart of the central business district, bringing more residents downtown and thereby supporting nearby businesses and growing our tax base,” he added.

Officials said the conversion advances the Connec+ing MKE Downtown Plan 2040 goals of doubling the downtown population and having a wider mix of uses downtown.

Klein Development and developer John “Johnny V” Vassallo own the 100 East building, which was built in 1989. The team has been pushing for the project since April 2023. Recently, a board approved the project for federal and state historic tax credits.

“This investment demonstrates that the City of Milwaukee is ahead of the curve nationally when it comes to recognizing the need to get creative and find a solution to repurpose obsolete buildings,” Vassallo said in a statement. “Transforming this building into housing reflects a broader vision of how cities can grow thoughtfully. This development would not be possible without the city’s leadership and commitment to the future of downtown Milwaukee. By supporting projects like this, the city sets the tone for what a vibrant city can be,” he added.

The city will also propose a $1.37 million investment for Compass Lofts, a mixed-use development with affordable housing units. The project is located on a city-owned tax foreclosed property at 3116 N. Dr. Martin Luther King Jr. Dr. in Milwaukee’s Harambee neighborhood.

The Martin Luther King Economic Development Corporation and EA Development proposed the project, which will have 67 new residential units including 56 affordable housing units, officials said. The project will also receive Low-Income Housing Tax Credits allocated by the Wisconsin Housing and Economic Development Authority.

That project is expected to cost around $19.8 million.

“The Compass Lofts development is a major win for the 6th District. It brings additional affordable housing to the King Drive corridor while transforming a vacant, city-owned property into something vibrant,” said Alderwoman Milele A. Coggs in a statement. “This is the kind of strategic investment that ensures growth is shared by the people who call this neighborhood home, and I thank the Department of City Development for their commitment to providing real opportunities for Milwaukee residents,” she added.

Through a competitive request for proposals process, the Compass Lofts development was picked to buy the city-owned side, DCD officials said. The proposal will also go under a city anti-displacement policy, which prioritizes existing neighborhood residents for some of the new units and allow them to remain in the neighborhood, officials added.

“Compass Lofts reflects our longstanding partnership with the City of Milwaukee to continue the vision of bringing economic development along King Drive,” Nicole Robbins, executive director of MLKEDC, said in a statement. “Creating affordable housing is not only important, it is essential. Projects like this are a positive step forward and continue the momentum for a thriving neighborhood,” she added.

In April, DCD released its guidelines for housing developments seeking tax increment financing, which seeks projects with affordable and workforce housing options and developments that repurpose underused office buildings into residential buildings, officials said.

“I want quality, affordable homes for people in Milwaukee,” said Milwaukee Mayor Cavalier Johnson in a statement. “And my administration is advancing that goal with thoughtful investments in new housing options. As our city’s population grows, I want current residents and new residents to have reasonably priced living alternatives in neighborhoods all across Milwaukee,” he added.

“We want to grow Milwaukee in a way that ensures it remains affordable and accessible to all,” Lafayette Crump, commissioner of DCD, in a statement. “By leveraging tools like TIDs, we are building both housing and new opportunities. These projects reflect our commitment to creative and quality development, and underscore the work being done every day to make stable and desirable housing available to all Milwaukeeans,” he added.

The DCD used TIF to provide financing for more than 15 affordable housing developments since 2018 following its own policy, DCD officials said.