29 Jan Affordable Housing Deal Not a ‘One-off’
Mandel Group’s planned affordable housing development in University Research Park, Photo: Mandel Group
A unique arrangement that could advance an affordable housing development near University Research Park could be replicated elsewhere, but perhaps not as frequently as some might hope.
That arrangement has allowed a long-awaited, $63 million affordable housing development from Milwaukee’s Mandel Group to gain some traction. It would permit the Mandel Group to receive city of Madison tax incremental financing and other real estate funding, and in exchange, Madison can purchase an option to acquire the property in 15 years.
The real estate services firm proposes to develop a multifamily facility with 197 units, many of them below the market rate-rental level, at Research Park near Garner Park on the city’s west side. The apartments would be situated along the new, east-west bus rapid transit (BRT) route and close to large University Research Park employers such as Exact Sciences, FluGen, and Thermo Fisher Scientific.
The high cost of housing is an acute problem in Madison and other cities. As of 2024, the vacancy rate for apartments in Madison is just 2.8%, according to an analysis by CBRE, and low vacancy rates tend to drive up the cost of rental units. City leaders, developers, and nonprofit organizations have been looking for creative ways to build more affordable housing in an area where the average rents for a one-bedroom unit ranged from $1,419–$1,511 in 2024, according to Apartments.com. Realtor.com reports that in 2023, the average cost of a single-family home was $391,053.
The six-story project would include studios and one-, two-, and three-bedroom units and 151 stalls of underground parking. Levels of affordability would vary: 144 units will be reserved for tenants making 60% or less of the county median income and another 53 will be for those making 80% of it. The development is part of a larger, multi-phase effort to remake Research Park’s northeastern corner, called Element Collective, that will create a concentration of housing and businesses with increased walkability.