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City of Madison

Hundreds of new affordable units get funding from City of Madison

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Hundreds of proposed new income- and rent-restricted apartments will receive financial support from the City of Madison’s Community Development Division after another round of Affordable Housing Fund awards were approved by the Common Council during its meeting on Tuesday, November 26.

The 2024 Affordable Housing Fund-Tax Credits Request for Proposals (RFP) competitive process offered gap financing loans for development teams that are also seeking Low-Income Housing Tax Credits from the Wisconsin Housing and Economic Development Authority (WHEDA). To receive City funds, applicants must secure 2025 Low-Income Housing Tax Credits from WHEDA and other financing needed to complete the project, have an ownership stake in the development, designate at least 20% of the units for those making 30% of the Area Median Income or less, adopt City-sanctioned tenant selection standards, and receive all relevant City land use and permit approvals.

The Community Development Division had approximately $10 million available from the Affordable Housing Fund, which is part of the City's Capital Budget, to support development proposals this year. The City’s primary goal is to add at least 250 units to the supply of affordable rental housing in Madison through this process – a goal that was again exceeded this year.

  • Computer rendering of proposed Merchant Place Senior apartments
    Image credit: Knothe Bruce Architects

    Rendering of the proposed Merchant Plance Senior Apartments development

    Image credit: Knothe Bruce Architects

  • Rendering showing proposed development at corner of East Washington Avenue and 7th Street
    Image credit: Knothe Bruce Architects

    Rendering of the proposed development at the corner of E. Washington Ave. and 7th Street

    Image credit: Knothe Bruce Architects

  • Rendering showing proposed development on Dryden Drive
    Image credit: Knothe Bruce Architects

    Rendering of the proposed development on Dryden Drive

    Image credit: Knothe Bruce Architects

Ultimately, a review team made up of Department of Planning, Community and Economic Development staff recommended awarding a total of $9.85 million in Affordable Housing Fund loans to these four proposed developments:

  • Up to $1.85 million for the CORE on Dryden Senior Apartments, a development from Horizon Development Group, Inc. and Kaba-Baal, LLC proposed for the City’s north side. The CORE on Dryden will contain 51 units, 43 of which will be affordable.
  • Up to $2.5 million for Merchant Place Senior Apartments, a development from Northpointe Development and Selassie Development proposed for the City’s west side. Merchant Place Senior Apartments will contain 60 units, 36 of which will be affordable.
  • Up to $3 million for United Residences, a development from Northpointe Development, Dream Lane Real Estate Group, LLC, and DCHA United – Madison, LLC proposed for the City’s north side. United Residences will contain 80 units, 48 of which will be affordable.
  • Up to $2.5 million for East Washington & 7th Ave, a development from Volker Development and Cordon Development Group, Inc. proposed for the City’s east side. East Washington & 7th Ave will contain 76 units, of which 40 will be affordable.
  • 270 Total Units

    Proposed

  • 167 Total Units

    Affordable to those making up to 60% AMI

  • 43 Units

    Will remain affordable for 40 years

  • 124 Units

    Will remain permanently affordable

Combined, these projects will add about 270 total units to Madison’s rental housing market, with 167 of them being income- and rent-restricted to those making not more than 60% of Dane County’s Median Income (e.g., $52,920 for a one-person household, or $68,040 for a three-person household). Of those 167 income- and rent-restricted units, 43 will be kept affordable for at least 40 years through a Land Use Restriction Agreement with the City of Madison, while 124 of them will remain permanently affordable.

The City of Madison continues to make affordable housing a priority through extensive investments in the Affordable Housing Fund and other citywide efforts to address the need for more housing of all types. This latest round of funding will add to the thousands of units we’ve been able to make a reality over the last few years through the expansion of the Affordable Housing Fund. As we grow the total amount of housing in Madison, families will have more choices and that benefits the entire community. Everyone deserves a home they can afford.

—

Mayor Satya Rhodes-Conway

The award of these funds comes on the heels of Council decisions in October to award more than $5.5 million of City financing to support a separate group of development proposals that do not involve tax credits. Those projects will bring an additional 152 income- and rent-restricted rental units to the Madison market.

Together, these City investments will add a grand total of 423 new rental housing units, 319 of which will serve households with more moderate incomes.

Continued Commitment to Affordable Housing

The Affordable Rental Housing Development: Tax Credit Request for Proposals process has been held every year since it was first introduced in 2014, using the City of Madison’s Affordable Housing Fund to support the goal of increasing, preserving, or improving the supply of affordable housing for Madison’s lower-income households.

Since its inception, the program has helped support the development of more than 2,700 units of affordable rental housing spread across Madison, about 2,100 of which are income- and rent-restricted for those making up to 60% of Dane County’s Median Income. To date, buildings containing almost 1,900 of those units have been completed.

  • 2,700+ Total Units Supported

    Since 2014

  • 2,100 Total Affordable Units Supported

    For those making up to 60% AMI since 2014

  • ~1,900 Total Units Completed

    Since 2014

Some of the more notable redevelopment projects that received support from the Affordable Rental Housing Development process and recently opened are University Park Commons at the former Westgate Mall site; the Uno’s Madison redevelopment on the City’s west side; the Andre apartments above the Red Caboose Child Care Center on the City’s near east side; the Park Cedar apartments, the South Park Street redevelopment designed with a first-floor grocery store; and the redevelopment of Bayview Apartments and Townhouses, an existing subsidized housing community at West Washington and Regent Streets, among others.

The City’s most recent Request for Proposals placed a continued emphasis on expanding the housing supply for those making not more than 30% of the Area Median Income (e.g., $26,450 for an individual and $34,000 for a household of three), making units permanently affordable, selecting locations that are well-served by transit, including design features to maximize sustainability and energy efficiency, and integrated supportive housing for individuals and families experiencing homelessness. The Request for Proposals generated nine responses, although one of the applicants later withdrew their proposal.

Additional funding for Triangle Redevelopment

Additionally, the Common Council has agreed to commit $10 million of City-managed federal dollars to support the first phase of the “Taking Shape” Triangle redevelopment project. 

The “Taking Shape” Triangle redevelopment is a decade-long, multi-phase project to be undertaken by the Madison Revitalization and Community Development Corporation (MRCDC) to replace Community Development Authority (CDA)-owned public housing built between 1965 and 1978 in the near west-side Triangle neighborhood. The first phase of the project involves construction of a 164-unit building that will replace the current Brittingham Tower.

Rendering of one of the buildings planned for the Triangle
Image credit: Potter Lawson

As part of a commitment to ensure that current residents of the CDA’s Triangle properties are not displaced during construction and will only have to move once, current residents of Brittingham Tower will move into the building before the Tower is demolished. The second phase of the project calls for a new building at the current site of the Brittingham Tower. When completed, the entire project will not only replace all 340 existing homes but will also add as many as 860 new homes at the 10-acre site at a variety of different price points.

Site plan showing the future configuration of the Triangle between Park Street and West Washington Avenue

More Affordable Housing Information

  • Housing Strategy Committee Report

    This recently completed report outlines Madison's housing supply and affordability, including several new recommendations to encourage more housing supply to bring median rents down.

Departments:
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