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Politics & Government

Ravenna Development Could Be Less Fruitful Than Village Originally Hoped

Asking the village to amend the development contract, developer Blair Williams plans to create apartments rather than condominiums due to plummeted demand for condos.

With the prospect of losing about 10 percent of the anticipated property taxes from a new Shorewood development, and the possibility of losing their entire promised profit share, it looks like the village won’t be getting quite the deal it signed onto in 2007 with Milwaukee developer, WiRED Properties.

The changes come in the aftermath of a collapsed condo market, and a decision by WiRED Properties President Blair Williams to construct apartments rather than condos in the four-story, mixed-use building coined the Ravenna, and slated for the vacant lot at 4533 N. Oakland Ave.

Williams asked the village's Community Development Authority Friday, to amend its earlier agreement and allow the switch to apartments. The change would reduce the minimum assessed value of the project, as guaranteed by the developer, from $7.7 million to $6.9 million or by about 10 percent.

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CDA Chairman Pete Petrie said village officials will calculate the impact on the development’s property taxes before an August 5 meeting, where they will consider the proposed change again, but confirmed it would mean about a 10 percent decrease.

Additionally, the amendment changes the developer’s obligation to share profits with the village. In the original agreement, it was outlined that WiRED would share any profits greater than 13.5 percent of its investment with the village.

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The change stipulates that the village will receive a portion of profits only under two conditions: the developer sells the property within five years, or the developer converts the apartments into condos within ten years. Under either of these conditions, if profits exceed 15 percent, the village will get 50 percent.

Williams said he did not have plans to convert the apartments to condos, but that it might be possible if the market improves.

The CDA considered the amendment to its development agreement in closed session, in case members wish to negotiate terms of the amendment with the developer. Petrie said he could not comment on whether the village will attempt to negotiate the new profit-sharing proposal.

Despite the changes, Petrie said he is pleased with how Williams has reacted to the market and adjusted his plans.

“This is a very good situation because most people would not have figured out how to get the best value today out of this building,” Petrie said. “It would be better to be doing original deal if condos were as popular as they were, but this is the best for right now.” 

While the proposed changes came as news for some members, Petrie said many members had already been discussing them with Williams.

“Some of us have followed it more closely and discussed with him his attentions,” Petrie said. “To the rest, it was new information, but not that troubled anybody. It’s all pretty common sense.”

Williams said the only change to the building design is the elimination of a restaurant space. He said the area is already saturated with food-serving establishments, some of which are in the building at 4510 N. Oakland Ave., developed by WiRED Properties.

“We’re very conscientious of the balance between Cornerstone and Ravenna as being neighborhood developments and responsive to neighborhood needs,” Williams said. 

Williams said space previously allocated for a patio would become five parking stalls, and the indoor space would go to another retailer.

Working with 7,500 square feet of street-level retail space, Williams has promised one spot to Shorewood's Performance Running Outfitters, 4401 N. Oakland Ave., and said he is conversing with two other potential retailers that would be new to Shorewood.

The Plan Commission and the Design Review Board must also approve the amendment.

If all committees approve the amendment on schedule, the final amended agreement will go to the Village Board August 8.

Williams said he plans to break ground in August and start filling retail space and apartments next June or July.

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