Shorewood Anticipates Offering $8.7 Million in Support for Oakland Avenue Development

Shorewood anticipates providing $8.7 million to a Milwaukee developer to help finance a $32 million, six-story apartment and retail development proposed for North Oakland Avenue.

Under the proposal,  the village would offer developer, the Mandel Group, a little more than $8.7 million including a little more than $3.92 million in grants, and approximately $1.24 million in administrative and other costs for a total direct cost to the village of roughly $5.17 million. The village would offer $3.56 million in loans to Mandel. The village's Community Development Authority recommended the Village Board approve the support at its next meeting. CDA officials also recommended the board amend TIF No. 1 to authorize an additional $10.2 million in expenditures, so the village will be ready for other development opportunities.

The development slated for the Shorewood Sendik’s parking lot, 4027 N. Oakland Ave., includes 84 apartment units, two parking structures and a new home for Shorewood's sole Walgreens store. Walgreens has only 90 guaranteed days at its current location, 4081 N. Oakland Ave., .

The Village Board to help establish Tax Incremental Financing District No. 4 to finance improvements related to the proposed development. The new taxing district would actually overlay onto TIF No. 1, but that district has to close by year 2022, which wouldn’t allow the village enough time for the new Sendik’s parking project to pay for itself.

The developer would pay back the $3.56 million loan over 17 years, using revenue from apartment rent and Walgreens’ lease.

The village would use revenue generated by property taxes under the tax district to recoup the $4.6 million it may invest in grants and other costs. Officials expect it to take 18 years before they recover the funds.

The remaining portion of the $32 million would be funded through a loan Mandel has secured with Wisconsin Housing and Economic Development Authority and some investment, according to CDA Chairperson Pete Petrie. That loan required the development have low-income housing. Most of the units would rent for around $1,200 to $2,000 per month; 17 of them would be set aside for moderate- to low-income renters and would rent for $775 to $1,200.

A TIF district is a mechanism used by communities to spur development. When a district is created, a municipality borrows money to pay for various public improvements related to development within the district. Once the development is built, the additional property taxes generated within the district are used to pay off that debt.

Officials said they plan to discuss a parking study that is being conducted at the CDA on May 6. Mandel and the village have been in talks with a consultant regarding studies of traffic and parking in relation to the new development.

The developer said it could break ground on the project as soon as next fall and has the rights to purchase the Sendik's parking lot property from current owner Katz Properties.

Officials have also said they have already started to address some of the issues residents have had with the development, including one raised by North Shore Presbyterian Church that the six-story building would dwarf the church and cause problems for solar panels on their roof, although they have not clarified how.