MONROE - An $8 million senior housing project in downtown Monroe has died, for a second time in two years.
Tom Sather, president of Silverstone Partners, Inc., informed the City of Monroe late last week that his firm was not able to secure financing from the Federal Home Loan Bank.
Without that financing, the project "simply was not going to be a competitive application" to earn federal tax credits through the Wisconsin Housing and Economic Development Authority (WHEDA), and Silverstone did not submit an application for the project, Sather wrote to Mayor Bill Ross.
"We've noticed, with WHEDA, that tax credits have become increasingly competitive over time," Sather said Monday. "And without something special, I think, in terms of financing, we scored the project and didn't think it was going to score enough points to be competitive in this round without the Federal Home Loan Bank funds we applied for."
Ross said he was disappointed about the project not being able to move forward.
"I would have loved for it to have helped TID seven," he said.
The city was ready to sell a municipal parking lot to allow Silverstone to build the 60-unit senior housing complex on the corner of 16th Avenue and 8th Street.
The development would help Tax Increment District No. 7, which is failing to raise enough funds in property taxes to pay its debt.
Acceptance into the program would have given the Middleton-based real estate development and investment firm about $5 million in tax credits, which is used to increase the investor's down payment in the development by lowering mortgage and financing costs. It does not relieve the firm from paying property taxes.
But the rejection for financing Silverstone got from the Federal Home Loan Bank did not surprise Ross, "given the tight economic state we're in.
"It's difficult to borrow money these days, even in home mortgages," he added.
Ross said the city will "stay the course," working on economic development downtown and throughout the city.
Having another go at building the senior housing project is for Silverstone to decide.
"We haven't given up on it, but we haven't a clear path yet on how we would get this done," Sather said.
"We do love the site, love the project, love the community, and hope sometime or other we could figure out how to put it together," he added.
Silverstone Partners' application for the Monroe project last year did not score high enough to participate in the federal tax credit program through WHEDA. Their request for added financing this year was expected to help increase the possibility of acceptance.
Tom Sather, president of Silverstone Partners, Inc., informed the City of Monroe late last week that his firm was not able to secure financing from the Federal Home Loan Bank.
Without that financing, the project "simply was not going to be a competitive application" to earn federal tax credits through the Wisconsin Housing and Economic Development Authority (WHEDA), and Silverstone did not submit an application for the project, Sather wrote to Mayor Bill Ross.
"We've noticed, with WHEDA, that tax credits have become increasingly competitive over time," Sather said Monday. "And without something special, I think, in terms of financing, we scored the project and didn't think it was going to score enough points to be competitive in this round without the Federal Home Loan Bank funds we applied for."
Ross said he was disappointed about the project not being able to move forward.
"I would have loved for it to have helped TID seven," he said.
The city was ready to sell a municipal parking lot to allow Silverstone to build the 60-unit senior housing complex on the corner of 16th Avenue and 8th Street.
The development would help Tax Increment District No. 7, which is failing to raise enough funds in property taxes to pay its debt.
Acceptance into the program would have given the Middleton-based real estate development and investment firm about $5 million in tax credits, which is used to increase the investor's down payment in the development by lowering mortgage and financing costs. It does not relieve the firm from paying property taxes.
But the rejection for financing Silverstone got from the Federal Home Loan Bank did not surprise Ross, "given the tight economic state we're in.
"It's difficult to borrow money these days, even in home mortgages," he added.
Ross said the city will "stay the course," working on economic development downtown and throughout the city.
Having another go at building the senior housing project is for Silverstone to decide.
"We haven't given up on it, but we haven't a clear path yet on how we would get this done," Sather said.
"We do love the site, love the project, love the community, and hope sometime or other we could figure out how to put it together," he added.
Silverstone Partners' application for the Monroe project last year did not score high enough to participate in the federal tax credit program through WHEDA. Their request for added financing this year was expected to help increase the possibility of acceptance.