By Neil Johnson email@example.com - May 24, 2022
The final product could likely be at least a year off, but a developer plans to spend $1 million to turn a vacant set of storefronts on downtown Janesville’s main drag into spacious upper apartments with commercial suites on the street level.
In a unanimous decision, the Janesville City Council on Monday night approved a tax-increment financing deal of $164,000 to help developer Ben Duckart Thompson rehab a two-storefront, three story building at 109-111 E. Milwaukee St. near the downtown riverfront.
City Economic Development Director Jimsi Kuborn said Thompson has retained a local architect and builder for a rehab that will revitalize retail space on the first floor, split the second floor of the 7,400-square-foot building into two apartments and dedicate the entire third floor to a single apartment space.
The property, known locally as The Merchants Building, is just east of the six-floor Prospect 101.
Thompson’s retail and apartment plans are smaller scale compared to some projects that have been in the works downtown, including a planned revamp of the century-old former Monterey Hotel that developers say could bring 56 market-rate apartments downtown.
But Thompson’s plans to spend $1 million on renovating the three floors of 109 E. Milwaukee St. is significant given the building’s history.
The property, located in the center of the downtown’s dining and entertainment district, has been underused for years, with its bay-window-adorned upper floors relegated to storage.
Since February, the entire building has been vacant. That was after Thompson bought the property late last year and the building’s first-floor tenant, CBD oil and delta-8 THC retail shop Hemp 1848 relocated a block south to a storefront on South Main Street.
The city’s report on the TIF deal estimates the renovations will boost the property’s assessed value from $195,000 to $700,000. That’s about $450,000 more than Thompson paid to buy the property late last year, according to city tax records, and it’s about $300,000 less than it is estimated to cost Thompson to fix up the building.
The Gazette on Monday afternoon could not reach Thompson for details on his plans for the project, but in a presentation to the city council Monday, Kuborn said Thompson’s TIF deal for the project requires Thompson to launch the rehab no later than October. The agreement gives Thompson until at least the beginning of 2024—more than a year and a half from now—to complete the project.
The TIF is structured as a “pay-as-you-go” project, meaning Thompson only is eligible to be reimbursed the portion of extra tax income the renovated property generates once he completes the project and satisfies the terms of the TIF deal.
According to project plans, Thompson intends to replace windows and electrical, plumbing and HVAC components in the circa 1900 building. He also plans to add fire sprinklers and replace the building’s rear deck and emergency exit.
Kuborn said the deal is structured with extra leeway given for construction work to accommodate the possibility of work delays because of ongoing supply chain problems and a labor shortage in the construction industry.
Thompson’s TIF deal is aimed at helping him bridge the gap between what it would cost him to renovate the property and what he believes he can generate by renting the space to commercial and residential tenants.
Kuborn said the project would satisfy major criteria the city has set up for use of its downtown TIF district: It would increase retail use in the downtown while avoiding an existing building becoming dilapidated. It also would bring more long-term tenants downtown, which in theory would boost daily foot traffic in the area.
Thompson hasn’t gone public yet with what retail might come to the storefront spaces. Prior to his ownership of the property and Hemp 1848’s earlier lease of part of the building, the second floor, geared now for office use, and the third floor, former apartment space-turned storage, have sat empty.
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