With the construction industry in a major slowdown, union and construction industry officials are lobbying Milwaukee aldermen to provide loans for The Moderne and the Bookends North developments.
With the construction industry in a major slowdown, union and construction industry officials are lobbying Milwaukee aldermen to provide $10 million in loans for The Moderne development and say they support a $5 million loan guarantee that New Land Enterprises is requesting for its Bookends North development.
“I think it’s a great opportunity for the city to get the construction industry out of the black hole that it’s in,” said Lyle Balistreri, president of the Milwaukee Building and Construction Trade Council. We’ve got people who have been off of work for a long time. I’m lobbying hard for (the Moderne loans). We need it badly. Anything that puts people to work right now.”
The Moderne is a proposed 30-story, $55 million building that investors led by developer Rick Barrett at the southwest corner of Old World Third Street and Juneau Avenue in downtown Milwaukee. The building would have 203 apartments, 14 condominiums and 7,500 square feet of retail space.
Bookends North is a 19-story, $70 million building that New Land plans to build at the northeast corner of Kilbourn Avenue and Van Buren Street in downtown Milwaukee. It would have 224 apartments and 3,000 square feet of retail space.
Both projects are seeking loan guarantees under the U.S. Department of Housing and Urban Development (HUD)’s 221(d)4 program.
Barrett says HUD has approved the loan guarantee for The Moderne. The AFL-CIO Housing Investment Trust Fund is one of the investors in the project. The construction loan is being serviced by Capmark Financial Group Inc.
The one remaining piece to the financing puzzle for the project are the city loans, Barrett said. If approved by aldermen The Moderne will be ready to be break ground shortly thereafter, he said.
Contractors and construction workers are hoping aldermen approve the loans to help jump-start the slumbering construction industry.
“The construction industry is really licking its wounds right now because of the lack of work,” said Mike Fabishak, chief executive officer of Associated General Contractors of Greater Milwaukee. “There’s not a lot of cranes in the air in the area anymore. These are very unusual times and I think they require people to step up. To me it makes good economic sense.”
The slowdown in development has driven the area’s construction industry unemployment rate up to about 25 percent, Balistreri said.
“We need to get this construction industry working, the sooner the better,” Balistreri said. “We need to get people working so they can go out and buy consumer goods and they can pay their bills. The construction industry is a big part of southeastern Wisconsin.”
The Moderne would be built entirely by union labor, Barrett said. About 1,000 people will work on the project and project supporters claim it would create another 900 jobs for support services, providing materials and supplies for the building.
In addition, the Moderne will have a 18 percent emerging business enterprise (EBE) goal and a 22 percent resident preference program (RPP) goal. That means 18 percent of the construction on the project would be owned by minority-owned Milwaukee firms and 22 percent of the workers would live in the city.
“We’re going to try to exceed these goals,” Barrett said.
“We believe this is a solid project that has all of the characteristics of being a catalytic project for the city of Milwaukee,” said The Moderne spokesman Tim McMurtry II.