RACINE COUNTY — A Milwaukee-based company intends to spend about $34 million to redevelop three Racine and Caledonia properties into market-rate housing, including the former Olympia Brown Elementary School.
In an interview Friday with The Journal Times, Inspired Real Estate Developers co-owner Dona Myers shared her company’s plans for a major, three-way entry into Racine County as developers (her partner, Chuck Hanka, was ill and could not participate).
The company has purchase agreements and hopes to close soon on all three properties planned for redevelopment and start construction as soon as possible:
The former Olympia Brown school, 5915 Erie St., Caledonia. Myers said that will be an approximately $18.5 million project.
The adjacent former Western Publishing office building at 5945 Erie St., an $8.5 million project.
Another former Western Publishing building at 1230 Sixth St., Racine — also previously home to a school, the REAL School — currently owned by Gospel Lighthouse. That will be about a $7.5 million project, Myers said.
None of the above development estimates include the buildings’ purchase prices.
“My heart has always been repurposing existing buildings,” Myers said.
Myers said she has done housing developments in her native Dallas area, and Hanka in Arizona. They incorporated Inspired last May.
Myers owned, and then sold, a title company in Dallas before coming north to make Milwaukee her home. She still owns Summit LDS, a title company there, and Hanka also is part of that company.
Myers said the company’s financing for the local projects will come from a partner who is in a large international hedge fund, and from that fund itself. She said the fund is sitting on millions of dollars and wanting to invest the money in real estate projects with one- to two-year turnarounds.
“There is an extraordinary amount of private money … that is not going into the stock market right now and is doing a lot of real estate in this state,” Myers said.
She added: “You can’t go to a conventional bank these days and expect to get this (kind of) thing done. Even if they’re drooling and they want it so bad, their hands are so tied with Dodd-Frank,” a reference to the Dodd-Frank Wall Street Reform and Consumer Protection Act.
“When you go into the private-sector money like this,” Myers added, “it opens up a whole new world.”
Water and history
Besides all three of Inspired’s local projects being redevelopments, they share two other common threads. One is their proximity to either Lake Michigan, in the case of the Erie Street properties, or the Root River, with the building at 1230 Sixth St.
The other is the buildings’ historical roots, which Myers said will be honored in the finished products.
The two Erie Street properties were originally part of the former Dominican College and the four-story building at 5945 Erie St. was originally a dormitory for the college. They will be developed together as a linked community on 23 acres.
IRED saved the school from being razed at the 11th hour in late December as the Racine Unified School Board was about to accept a demolition bid. The company paid $900,000 for the school and $564,000 for the former dormitory.
The old dorm, at about 66,000 square feet, will be redeveloped as about 70 “market rate and slightly above” apartments of three types, Myers said: one bedroom, one bathroom; two bedrooms, two bathrooms; and two bedrooms, two bathrooms and den.
The 138,000-square-foot school, which Myers said is structurally sound, is partly on three levels and partly on four. It will become both condominiums and apartments, “probably more condos,” Myers said. The number of units is still unknown, but she said they will have architectural renderings by the end of this month.
The school will not be gutted — the large old classrooms will become new living units.
The style will be very contemporary with open spaces; sleek, European-style cabinets, stainless steel appliances and many windows, Myers said.
The school project will also include future new construction and possibly single-family homes, Myers added.
Sixth Street redo
Myers said plans for the three-story building at 1230 Sixth St. are to convert it to about 53 apartments as large as three bedrooms and 2½ bathrooms and as small as a dozen microapartments of about 400 square feet each. “I want to test these in that building,” she said.
Only recently has Inspired begun considering building more housing, with a second building, on the site that now has an expansive parking lot. Part of that lot will be converted to grass along the river, Myers said.
The building sits on 3.8 acres along the river, and Myers said the company is happy to allow an easement so the city could extend its future river walk along there.
The name planned for that redevelopment is The Edge of the River.
In all cases, Myers said, Inspired will build the housing, engage an established management company, get the properties to about 80 percent occupancy and then sell them.