CITY OF KAUKAUNA PARTNERS WITH KENOSHA DEVELOPMENT TEAM ON $30M DOWNTOWN PROJECT
The City of Kaukauna Common Council voted to enter into two separate development agreements with Kenosha-based, Harvest Development, LLC at their Tuesday meeting on August 3rd. The 3.1 acre Uptown Site is nearly an entire City block, bound by Lawe Street, Wisconsin Avenue, and Catherine Street. The site has been municipally owned since 2018 with the goal of attracting a high-density and high-value development.
Harvest Development (developer), Berkadia (financing partner), Lighthouse Hospitality Group (hotel operator), and Founders 3 (apartment managers) are the development team behind this project. The group has proposed a 68-room Choice Hotel Brand Sleep Inn and Suites hotel and Edgewater Pointe, a 101-unit market-rate apartment complex, on the site. The new development consists of a $30 million dollar investment in the site, which will generate a guaranteed minimum assessed value of $15 million dollars per year through the life of Tax Increment District No. 8. As is common on many downtown redevelopment projects, a TIF incentive (combination of a municipally-backed commercial loan and a developer cash incentive) was a critical part of bringing this development to Kaukauna.
The hotel operator intends to capitalize on new and existing market demand for regional tourism needs and local business and leisure travelers. The apartment complex features luxury amenities such as underground parking, enhanced security, pet-friendly units and amenities, high-end unit finishes, community room, and outdoor recreation facilities. The 5-story apartment building has exceptional views of both the downtown area and the Fox River and 1000 Islands Conservancy.
A recently completed housing analysis of Kaukauna’s downtown area completed by Redevelopment Resources in 2021 notes a significant gap in apartment inventory. The report noted conservatively that existing demand could support 150 new units in the downtown over the next five years. 109 new rental units will come online through 2023 between this project and the redevelopment of the Carnegie Building. This market demand is due to a number of factors, including shifting housing preferences for young professionals and empty-nesters, a limited inventory of single-family homes, and a limited number of new multi-family construction projects in Kaukauna over the last decade. A hyper-competitive housing market in the Fox Cities also makes renting a compelling option for many.
Kaukauna’s Mayor Tony Penterman notes, “We’re excited to see this vacant site developed and are confident that this project will be highly impactful on our community”. Other Northeast Wisconsin communities have seen a positive correlation between new downtown residential offerings and increased business demand for both new and existing services, such as dining, shopping, and entertainment within close driving or walking distance.
Jim Walter of Harvest Development shares, “We are thrilled to be working with the City of Kaukauna to bring these two projects into existence. Without the City’s vision and support, these projects could not take place. This new apartment community will attract a great mix of residents into downtown, particularly, young professionals and active adults to enjoy the benefits of living in a modern building with great amenities in a beautiful location and thriving community. Moreover, these new residents will bring new patronage and support to our local businesses for the benefit of all”.
At the time of this release, the City has delivered a development agreement to the developer for their execution. A signed development agreement, loan agreement, and financial authorization from the developer’s lender are minimum requirements that must be met to sell the property. The real estate closings are anticipated by the end of August. Hotel construction is slated to begin first with a goal of opening by the beginning of the 2022 Packers season. The apartment construction will follow soon after with the goal of residential occupancy in summer 2023.
Media inquiries should be directed to the Mayor’s Office. Karen Koch, Administrative Coordinator, Office of the Mayor: [email protected], 920.766.6310.