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Brown Deer residents turn in petition against rental housing proposal

Developer trying to salvage investment after 2008 crash

April 18, 2013

Editor's Note: Petition organizer Don Uebelacker and resident Mike Christopulos have contacted NorthShoreNOW to clarify that the petition, and petitioners, do not oppose low-income housing.  While General Capital's plans are for low-income rental units, Uebelacker stressed that the petition only takes issue with rentals on the site and urges the village to require owner-occupied condominiums, as the original 2007 development agreement stated.

"The condominiums were to be owner occupied and were not to ever become rental units," said Uebelacker. "Back then, and certainly today, the feeling was that Brown Deer has more than enough apartments. Both the residents and the village management wanted the stability of owner occupied units."

Brown Deer - A thousand-strong group of residents is trying to snuff out a rental housing development before it even comes before village officials for consideration, while at the same time a developer is planning low-income and disability-friendly units on the site.

On Monday a group of several dozen neighbors to the Beaver Creek development - which includes the Walgreens at 60th Street and Brown Deer Road, alongside 10 condominiums - delivered a 1,044-signature petition to the Village Board which states their opposition to rental apartments on the site. Petition drive organizer Don Uebelacker said that after planning to collect 250 to 500 signatures, he was shocked to bring in more than 1,000 in a four-week span.

Brown Deer partnered via tax incremental financing with Milwaukee-based developer General Capital in 2007 to build 51 condos at the Beaver Creek site. General Capital built 10 before the economic crash of 2008, after which four sold and the remaining six languished before they were eventually rented, General Capital President Mike Weiss said.

"There was no demand," Weiss said. "The whole world changed."

In an attempt to turn around their investment in the site, Weiss and General Capital, in conjunction with Jewish Family Services, are planning 44 units similar to the combination of low-income and disability-friendly apartments at the recently opened Bradley Crossing Supportive Housing Community at 43rd Street and Bradley Road - on which General Capital and JFS also partnered. As with Bradley Crossing, General Capital and JFS are seeking a combination of tax incremental financing from the village and tax credits from the Wisconsin Housing and Economic Development Authority to fund the project. The Village Board in January suspended the development agreement with General Capital, allowing the developer to apply for the WHEDA credits and setting the stage for a Bradley Crossing-like proposal at Beaver Creek to come before village officials if the credits are awarded in the coming weeks.

Original terms wanted

Uebelacker and the petitioners stress that when the village approved the development agreement with General Capital in 2007, two concepts were agreed to - that the upscale condominiums would be a transition from the Brown Deer Road commercial area to residential areas to the north, east and west, serving to complement existing residential properties, and that the condominiums would be owner-occupied.

"The bottom line is, if (the developer) is having trouble selling condos and they want a change, it's not up to the village of Brown Deer to bail them out," resident and petition-signer Mike Christopulos said. "That's the business. That's not our problem to fix up their business problems."

Kevin Wisth, who resides in the Royal Gardens condominiums, also expressed concern that more rental units in the area could impact the ability of that complex, more than half of which already consists of rental units, to survive, by potentially drawing residents away.

"To me, by building one complex, you're going to destroy another," Wisth said. "And it's not going to be an apartment complex, it's going to be a condominium complex."

Village Attorney John Fuchs cautioned the Village Board against responding to resident comments, due to the fact that no proposal has been received by the village at this time and no notice of a public hearing on the issue had been posted.

Developer plans to expand

While Uebelacker and the petitioners describe the existing Beaver Creek condos as upscale, Weiss calls them "affordable," ranging from approximately $179,000 to $229,000 when they hit the market in 2007. As time wore on after the economic collapse of 2008, General Capital was unable to sell the remaining six and eventually resorted to renting them.

"There was no market," Weiss said. "There wasn't even a market at a lower price."

By moving from condos to a combination of low-income and disability housing, Weiss said, General Capital would be moving from "zero" to "tremendous" in terms of demand. As of March, the waiting list at Bradley Crossing was nearly 140 names deep, prompting General Capital and JFS to plan a 54-unit expansion at Bradley Crossing and the 44-unit development at Beaver Creek. Weiss said the planned Beaver Creek development would be similar to Bradley Crossing, but whereas Bradley Crossing is a 50/50 split between low-income and disability housing, the Beaver Creek project would be 75 percent general population and 25 percent disability, with 37 of the 44 units at a low-income rental rate and seven at a market rate.

"We think they're tremendous community assets, at a lot of levels," Weiss said. "There's been huge demand for the kind of thing we've done at Bradley (Crossing). We're confident that's the right direction to go."

Village protected

Whether the project eventually comes to the Plan Commission and Village Board depends entirely on whether WHEDA decides to award tax credits for the project, Weiss said. Regardless of the outcome, the village will reclaim its approximately $1.8 million tax incremental financing investment in the Beaver Creek. The 2007 development agreement between General Capital and Brown Deer obligates the developer to pay property taxes based on a set of guaranteed property values - similar to guaranteed values which have compelled Lowe's to pay property taxes on a higher-than-market property value after the company vacated its building on Brown Deer Road.

According to an updated TIF agreement passed by the Village Board in January, Brown Deer would subsidize the project by a further $550,000 if General Capital increases the property value of the site to certain amounts with the Bradley Crossing-esque development. That, too, is protected by guaranteed value language in the updated agreement.

The Village Board did not discuss or act upon the matter Monday. Plan Commission and Village Board approval would be needed before any plans could advance.

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