The Madison Plan Commission approved a 1,650-bed student housing development near the city’s downtown area on Monday.
The “Johnson & Broom” proposal, introduced by Chicago developer Core Spaces, will construct a four-building, 465-unit housing development at 407 West Gorham Street. The proposal approved by the Plan Commission includes amendments securing more affordable housing units for students.
The development would tear down existing housing on the blocks. One building will rest at eight stories high, while the other three will stand at 14 stories.
This new proposal, negotiated by District 8 Ald. MGR Govindarajan, requires Core Spaces to include 10% of all beds — around 165 beds — at 40% off market price for 40 years. In return, the city will lift the building height limit to allow the project to go forward, but the city will fine Core Spaces $8 million if they infringe upon this stipulation.
This amended proposal adds an additional $3 million to the fine and an additional 10 years to the agreement proposed earlier this year, according to Govindarajan. If Core Spaces sells the development, the buyer would still have to abide by the 40-year contract.
Govindarajan told The Daily Cardinal he pushed for the developer to include more affordable housing units.
“I was a little disappointed when I heard the initial agreement because I felt like we could have gotten more out of it,” Govindarajan said. “So I met with the developers and requested a compromise.”
District 4 Ald. Mike Verveer, who represents the proposed site for Johnson & Broom, said the agreement is part of the city’s plan to offer incentives for developers to include affordable housing units in new projects.
“Housing has always been a huge issue for our community and for Madison city government, especially trying to help people find access to affordable housing,” Verveer said. “Most recently, we've really pivoted to this idea of providing density bonuses or height bonuses to developers in return for affordability.”
Core Space developed luxury student apartment buildings near the UW-Madison campus, including the James, the Hub and its newest addition, Oliv, opening in the fall of 2024. If approved, the Johnson and Broom development will be its fourth project in Madison.
The Common Council will vote Nov. 21 on whether to amend zoning ordinances to allow the project to proceed. If approved, the building height restriction will be lifted for the project.
It is unlikely that Core Spaces will break the binding contract, according to Govindarajan. If the contract is broken, the $8 million stipulation will go directly into the city’s affordable housing fund, and the city will be able to sue Core Spaces.
According to Govindarajan, this agreement is “more favorable for students” and “a big win” toward the goal of increasing housing affordability.
The University of Wisconsin-Madison’s Office of Financial Aid will determine student eligibility for the affordable units. Eligibility and price rates for these units are not yet determined, Govindarajan said.