The Milwaukee Department of City Development (DCD) is seeking proposals from developers interested in rehabilitating vacant, city-owned houses.
Called the Homes MKE Initiative, the effort is aimed at renovating and reoccupying a minimum of 150 vacant and foreclosed city-owned houses using $15 million in federal American Rescue Plan funds.
“Growing up in Milwaukee, I experienced the effects of housing insecurity just as many residents and families currently are. This is personal for me, so we worked to deploy federal ARPA funds for this initiative that will revitalize vacant properties into new homes,” Mayor Cavalier Johnson said in a press release this week. “Together, we are working to build stronger neighborhoods, promote homeownership, and ensure every Milwaukeean has access to the quality, affordable housing they need.”
As part of the program, the city will sell properties to participating developers at a purchase price of between $1 and $501, or an alternative discounted purchase price depending on the location and condition of the property.
Properties for the program will be primarily located in an area roughly bounded by Silver Spring Drive on the North, Lincoln Avenue on the South, the Milwaukee River on the East and Sherman Boulevard on the West.
The city will assign packages of properties to participating developers. The number of properties assigned to each developer will depend on their capacity to acquire and renovate them within the timeframes and to the standards required by the city and ARPA regulations.
While initial packages of properties will be assembled from the city’s existing inventory, because the city acquires properties on a continuous basis, developers may be able to acquire additional properties during the course of the 18-month program.
Successful bidders will be eligible to receive “gap financing” for the redevelopment of the properties based on the difference between the total development costs for the property and the estimated value of the property after rehabilitation.
Responses to the RFP will be due on June 3, with the city expected to announce grant awards on June 30.
The deadline for executing the first half of the ARPA-funded redevelopment agreements will be July 29, according to the press release. The deadline for the second half will be on Dec. 31, 2023.
Regardless of purchase price, buyers will be responsible for closing of around $700 per property, and as well as listing broker commissions where applicable. No buyer broker commissions will be paid for properties purchased for the program.