The developer proposing to build 100 luxury apartments in Whitefish Bay is requesting a $4.9 million investment from the village through two types of tax incremental financing.
The Mandel Group's $27 million, three-building development would contain 100 high-end apartments in the parking lots north of Silver Spring Drive, between Santa Monica and Consaul Place.
Mandel is seeking TIF funds to finance this work, including $2.7 million in public parking renovations. Mandel is requesting:
- $1.6 million in village-issued tax incremental financing (TIF) bonds. The village would retain ownership over the eastern parking lot and a redesigned public walkway.
- A $2.2 million pay-as-you-go TIF note, which places the up-front project costs on the developer's shoulders with a promise from the village to reimburse the developer.
After hearing a presentation from Mike Harrigan, the village's financial adviser, on Monday, the Community Development Authority set a hearing for 6 p.m. on Sept. 6 for public input on the proposed TIF district. The district would include almost all of the parking lots from Consaul Place to Santa Monica, as well as the Consaul Commons pedestrian walkway area.
A tax incremental finance district allows a municipality to borrow and spend money on public improvements, and then recoup the money through the growth in tax revenue generated by those improvements.
Mandel Group Chief Operating Officer Robert Monnat said Village Manager Patrick DeGrave advised The Mandel Group in an earlier conversation that the village would like to use as little municipal bonds as possible. In turn, The Mandel Group agreed to pursue the pay-as-you-go TIF method for a portion of the project.
The tax revenue collected by the village will first be used to pay the conventional TID debt, and if there’s sufficient tax money, the developer will be paid starting in 2015. If the property doesn’t produce as much revenue as expected, the developer doesn’t get the full amount.
"That (TIF method) affords an additional level of protection for the village," said Harrigan, the village's financial adviser.
Once the project is built and stabilized, the developer estimated the property will be valued at $14 million, and return an additional $320,000 in annual tax revenue. The developers expect the TIF will close by 2040, one year earlier than the 27-year maximum prescribed under state law.
The assessed value of the two village-owned parking lots and Consaul Commons walkway is $0, and the assessed value of the lot closest to Santa Monica Boulevard is $423,700.
Just because the land is off the tax rolls doesn't mean it is without value. The village is including $1.1 million in air rights in the value of the project to symbolize the value of the air above the public parking lots on the east end. When all other TIF bonds have been paid off, the village will pay itself for the contribution. Those details are still being worked out between the village and The Mandel Group.
Details of the exterior design were also presented at the joint meeting of the CDA and the Architectural Review Commission Monday night.
The two buildings on the east end of the site would feature underground parking for residents, ground level parking for retail customers and three levels of apartments above the sheltered parking area.
The two 54-foot buildings would be separated by a 40-foot-wide pedestrian walkway that would connect to Silver Spring through the space between the former Cutters barbershop and the former El Guapo's space.
The four-story building along Santa Monica Boulevard would feature terrace apartments on the first level instead of ground level parking. Residents of that building would also park in an underground structure.
Most of the ARC members seemed generally in favor of the project but addressed a few details.
ARC commissioner Patricia Frost said she approved of the building closest to Santa Monica Boulevard, but thought the two buildings on the eastern end of the parking lot looked flat and monotonous.
"I think it's critical that everyone leaving sees something lovely and not something that appears to be a Third Ward warehouse that is now in Whitefish Bay," she said.
In response to another commissioner's comments, Monnat said the architectural design is meant to blend the historic nature of surrounding architecture with a more modern aesthetic.
"We did ask that the detailing be a modern interpretation of these beautiful late 1920s apartment buildings that were done before the Depression ... but we wanted it to be brought forward in a modernist interpretation," Monnat said.
The developers said they would take the commissioners' comments into consideration. The ARC will meet with the developers again at 5:30 p.m. on Aug. 23 to talk about the architecture in greater detail.
Once the ARC approves a design, it will make a recommendation to the CDA, which will then make a recommendation to the Village Board. The Village Board will have the final say on the rezoning proposal, design and final development agreement.