An $86.5 million plan to buy and convert two large Milwaukee apartment communities from market rate to affordable rents may have hit a City Hall roadblock.
The plans are targeting the 236-unit St. James Place, built in 1989 at 10300 W. Fountain Ave., and the 138-unit Arbor Ridge Apartments, built in 1999 at 7960-7972 N. 107th St.
A group led by Calabasas, California-based Post Real Estate Group would buy the two far northwest side communities and spend $2.25 million on upgrades, including new kitchen appliances, electrical repairs, and exterior painting.
Post Real Estate Group, an asset manager, and its partners, including prospective owner Bedford Affordable Housing Foundation, would finance the purchase and improvements with tax-exempt bonds.
That would deliver a lower interest rate on that bond debt, which provides the ability to reduce the rents.
Those bonds would be sold to investors through the state-created Public Finance Authority, and would not involve any city or state funds.
But the authority requires city approval for that bond sale.
And the Common Council’s Zoning, Neighborhoods and Development Committee is recommending the full council deny that approval.
That committee vote came at its May 5 meeting ahead of the council’s May 12 meeting. There’s also a public hearing scheduled for May 11 in the city clerk’s office.
Committee members cited opposition from Alderwoman Laressa Taylor, whose district includes the two apartment communities.
Taylor told the committee she wants to attract to her district additional “luxury apartments.”
“We certainly don’t want to lose the two that we have,” said Taylor, who described St. James Place and Arbor Ridge as “very well-managed.”
Most communities need more affordable housing, said Post Real Estate Group attorney Ray Jones.
He said the plans would involve reducing rents of improved apartments as they became available when current residents move out.
The one- and two-bedroom apartments would be targeted to people earning up to 80% and 60% of the Milwaukee area’s median income, Jones said. The latter is around $66,400 for a four-person household, according to the U.S. Department of Housing and Urban Development.
Residents earning up to that 60% level would see monthly rents reduced by up to $490 at St. James Place and up to $343 at Arbor Ridge, according to his presentation. Minimal rent reductions would be $20 and $112, respectively.
Brookfield-based Point REM would manage the properties, and Fannie Mae would provide credit enhancement that includes requirements for annual inspections and cash reserves for maintenance needs, Jones said.
But Taylor said she’s only communicated with Post Real Estate by email. And committee members noted that Jones made his presentation virtually without appearing at City Hall.
“This may all be fine but you’ve got to come talk to people,” said Alderman Robert Bauman, who chairs the committee.
Alderman Russell Stamper II moved to deny the bond sale, with Bauman and the other committee members joining him in support.
St. James Place and Arbor Ridge are owned by Weidner Apartment Homes, based in the Seattle area.
Tom Daykin can be emailed at tdaykin@jrn.com and followed on Instagram, Bluesky, X and Facebook.
This article originally appeared on Milwaukee Journal Sentinel: City Hall opposes switching market rate apartments to affordable rents
Reporting by Tom Daykin, Milwaukee Journal Sentinel / Milwaukee Journal Sentinel
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