Developers Aim for Artists as Tenants in Kunzelmann-Esser Rehab
Furniture store will become shops, housing

By Tom Daykin
Milwaukee Journal Sentinel, March 14, 2002

On Mitchell St., art isn't imitating life - it's bringing life to the neighborhood.

The eight-story former home of Kunzelmann-Esser Furniture Co., a century-old Mitchell St. landmark, is being converted into 67 loft apartments/work studios for artists, says Madison developer Tom Capp.

The $8.1 million development is being done by Gorman & Co., which bought the building last week for just under $950,000. Remodeling already is under way at the vacant 92,000-square-foot building at 710 W. Mitchell St., and some of the lofts will be completed by this fall, says Capp, executive vice president at Gorman.

Capp disclosed plans last summer to renovate the Kunzelmann-Esser building into apartments, while leasing the building's street-level space to retailers. But the decision to market the lofts specifically to artists is a new development.

Capp says the initial idea came from Mayor John O. Norquist, who mentioned that some of the city's artists, facing higher rents in the Historic Third Ward and Walker's Point neighborhoods, were moving to Mitchell St.

Also, artists are known for their willingness to live in neighborhoods that might scare off other people, Capp says. While a series of recent projects have brought new investment to the area, many people still remember three gang-related murders that occurred on Mitchell St. in 1998.

"Mitchell St. is improving tremendously, there's no doubt about it," Capp says. "But reputations die hard."

So, enter the artists.

Visited other cities
To prepare the project, Gorman studied about 70 artists apartment/studio developments throughout the nation, and visited some in Indianapolis, St. Paul and other cities.

"We saw there were successful live-work communities in a lot tougher neighborhoods than Mitchell St.," Capp says.

Gorman also worked with the Milwaukee Arts Board to set up a focus group meeting with artists.

As a result of the research, the Kunzelmann-Esser lofts will include concrete floors that can handle spilled paint; a pressurized ventilation system to keep paint smells from wafting about the building, an open interior design and lots of light, from both the building's large windows and track lighting fixtures.

The building's other features will include a special disposal area for paint and other hazardous materials; two art galleries for renters to show their work, including a two-story gallery for large pieces; a room for multimedia presentations; a studio to take photographs of completed pieces; and an office to meet clients.

But the building's biggest attraction will be its ability to allow artists to have friendships and working relationships with each other, Capp says.

"One of the things that we found from studying other communities is that artists will do a lot to live with other artists," Capp says. "Now, in Milwaukee, they're either in illegal commercial spaces, or they're the funny neighbor who's up at 3 in the morning with paint smells coming from their room."

Affordable housing
Another big draw will be the affordable rent: $700 for a two-bedroom unit, $610 for a one-bedroom unit and $525 for an efficiency.

Renters are restricted to people earning no more than 60% of Milwaukee County's median income, adjusted for the size of their household. That ranges from $28,200 for a one-person household to $43,560 for a five-person household, such as a couple with three children.

In return, Gorman is receiving federal affordable-housing tax credits totaling $1.9 million to help finance the development.

Other financing includes federal and state historic preservation tax credits totaling $1.3 million; $625,000 in federal funds provided through the city's Community Development Block Grant program; and a $4.3 million low-interest loan provided by the Wisconsin Housing and Economic Development Authority.

Alliant Capital, led by real estate investor Sidney Kohl, is buying the tax credits, making it the main equity investor.

The tax credits require Gorman to keep the rents at affordable levels for 15 years. Capp says that should be especially attractive to artists, who often find themselves priced out of improving neighborhoods when rents increase and apartments are converted to condominiums.

Artist Judith Hooks says the lofts/studios will find a market.

"People don't realize how many artists there are in Milwaukee," says Hooks, president of the Walker's Point Artists Association, which operates Gallery 218, 218 S. 2nd St. "They'll fill up immediately."

Hooks, however, says she would be "a little leery" about living on Mitchell St. because of concerns about crime.

"I've lived like that," says Hooks, who lives in Walker's Point. "But now I'm getting kind of old to live on the edge."

The Kunzelmann-Esser building is the latest in a series of recent projects in the Mitchell St. neighborhood. An influx of new residents, mainly Hispanics, has led to increased attention from retailers and developers.

That includes Gorman's remodeling of the 117-unit Golden Domes Apartments, about a block northeast of the Kunzelmann-Esser building at 1630 S. 6th St. The $8.2 million project is creating larger units with new features at the Golden Domes, which was deteriorating.

There also is a cultural rebirth, including efforts to transform the Modjeska Theatre, 1134 W. Mitchell St., into a cultural center. The theater is already used for concerts and live theater, and is close to launching a fund-raising campaign for a major remodeling project.

"I think the whole street might become the next artists area," says Diane Johnson, Modjeska co-owner.