As originally documented in The Restoration Economy (2002) and more recently in RECONOMICS: The Path To Resilient Prosperity (2020), many cities are far too quick to call in the demolition teams when they have “blighted” neighborhoods with excessive vacant houses.
Many times, these structures can and should be renovated, not removed. Since insufficient affordable housing is one of the greatest urban problems today—especially in the United States—rehabilitating vacant homes should be at the top of every city’s agenda.
Milwaukee, Wisconsin is one city that understand this. They recently published an RFP for their Homes MKE initiative, to recruit private developers to rehab 150 vacant houses.
Back in 2021, Mayor Cavalier Johnson and members of the Milwaukee Common Council allocated $15 million in federal American Rescue Plan Act funding to DCD for the Homes MKE program.
“Growing up in Milwaukee, I experienced the effects of housing insecurity like many residents and families currently are. This is personal for me, so we are working to deploy the Homes MKE initiative to revitalize vacant residential properties into renovated homes,” said Mayor Johnson.
“Together with our partners in the development community, we are building stronger neighborhoods, promoting homeownership, and working to ensure every Milwaukeean has access to the quality, affordable housing they need,” he added.
The goal is to renovate vacant houses in the city’s inventory of tax-foreclosed residential properties and return them to productive use.
The specific goals of Homes MKE are to:
- Sell, renovate and reoccupy a minimum of 150 vacant foreclosed City-owned houses;
- Prioritize the development of the houses to provide homeownership opportunities for City residents;
- Coordinate redevelopment efforts that result in a positive impact for the surrounding neighborhood;
- Provide construction and job opportunities;
- Provide development opportunities for emerging developers; and
- Collaborate with local residents to provide housing and resource opportunities in neighborhoods where Homes MKE properties are located.
A total of 66 proposals were submitted, an unprecedented response, according to the Department of City Development (DCD), with 15 of those developers selected.
The city will sell the houses for as little as $1 while providing a $75,000 development subsidy and a $5000 workforce subsidy.
After renovation, the properties can be sold to owner-occupants, rented, or put into a rent-to-own program.
The properties are not allowed to be flipped to another investor-owner. Unless sold to an owner-occupant, the homes must be developer-owned for at least five years. In addition, developers are required to provide work to unemployed or underemployed city residents. 50% of employees must also reside in a collection of specific zip codes, and they must be paid a living wage of at least $12.21 per hour.
Now, on September 12, 2022, the Milwaukee DCD announced the development teams selected to participate in the Homes MKE initiative. Through a competitive RFP process, these development teams will work with DCD and community partners to renovate vacant City-owned residential properties that will help build stronger neighborhoods throughout Milwaukee.
The selected development teams are a mix of emerging developers, for-profit developers, and non-profit developers. They include: Acts Community Development, Advanced Investors, FIT Investment Group, LLC/Westcare Wisconsin, Inc., Maures Development Group, One 5 Olive/Milwaukee Community Land Trust, Rico Love Foundation LLC/Mayfield Properties, Strong Blocks, CME Development, LLC, Even Life, Inc., Ezekiel Community Development, Metcalfe Park Community Bridges, Servant Manor, T.A.S. Solutions, LLC, Walnut Way Conservation Corp./Silicon Pastures II, LLC, and Walters Renovations, LLC.
The Milwaukee Common Council will consider the selected development teams for Homes MKE through File #220656, which will first be heard by the Zoning, Neighborhoods, and Development (ZND) Committee on Tuesday, September 13. After Common Council approval, DCD will execute development agreements with the selected teams and begin implementation of Homes MKE.
The MKE initiative is funded by $394.2 million in federal money from the American Rescue Plan Act, which was created to offer pandemic aid.
Photo of downtown Milwaukee via Pixabay.