Q&A with Paul Molinaro of Welton Enterprises
1. Have you made any changes to your plan since the last meeting?
We have been revisiting our financial projections with rates trending downwards. If we can find savings in the project costs, we’ll lower our TIF request.
2. What will you do if you do not get TIF funds for project phase 1 and/or WHEDA for phase2? Will your project fall through?
Phase I is not financially feasible without TIF; so we cannot move forward without that portion of the capital stack. Phase II also could not move forward without the required tax credits, similar to any affordable housing project. However, we feel strongly that Madison can and should provide the necessary TIF to whichever developer is selected to secure a grocery store for this neighborhood. The city has made large investments in the East Washington corridor, its future Public Market, and projects around the square; so there is capacity to invest in projects that help meet a city goal or neighborhood need.
3. How do you ensure that we will avoid a food access gap?
Phase I would be completed in 2021 so there would not be any food access gap unless something were to happen in the interim to the current store that is out of our control.
4. When would the city have to complete the road for you to make a supermarket completion date of 2021 and could you build simultaneously with their road construction?
At the latest, we need the road completed just prior to the store opening; so we would anticipate building simultaneously. We would work with the neighborhood on the preferred location of the street since owning the adjacent site gives us some flexibility that others cannot offer. As you know, our preferred location for the road is on the southern lot of Truman Olson to serve the access needs to the development and avoid a potential traffic problem that a road along the north lot line could create.
5. What would you say is the city's greatest concern about your plan and how can you address that?
TIF/city assistance, but the city has the ability to provide the TIF that was requested. Although our TIF request may be outside of normal operating policy guidelines, this circumstance warrants the appropriate city investment to secure long-term food access for the neighborhood.
6. Is there the possibility of changing the balance of market rate to affordable housing so there is more affordable housing?
We are proposing market rate in Phase I for two reasons: 1) Most importantly, we would not have to wait for tax credit award to move forward with the project. If we had to wait for a 9% tax credit award, we would not be able to break ground until 2021; and 2) Diversity of housing options creates a balanced neighborhood; so we prefer a concept where we provide a good amount of both market rate (phase I) and affordable housing (phase II).
7. We're interested in the long-term viability of the store and the lowest prices possible to the community. Can you lower your rent for the supermarket long-term? Is there wiggle room in your ROI?
We are proposing a relatively small ROI that only meets the minimum bank requirements. We need bank financing to make the project work and cannot go below bank requirements which are controlled by federal regulations.
8. What is the possibility of including meeting space for the surrounding neighborhood/community to use as part of the development?
We would welcome the discussion on including meeting space and how that could function.
9. Have you built other mixed-income/affordable projects? What lessons have you learned from these that will benefit South Madison?
Yes, our development team has quite a bit of experience in both mixed-income/affordable projects. Neighborhood involvement in the design of the concept and actual building is critical on the front end. Diligent management ensures long-term success and a good relationship with the surrounding neighborhood.
12. How do your plans accommodate people with physical and sensory disabilities as they navigate the grocery store and their living spaces?
We would meet all applicable building codes and would welcome input on how to best serve this population.
13. What environmental contamination is present on the T-O site to qualify it for the $500,000 WEDC Brownfields Grant?
The extent of contamination, if any, is not known by any developer and will not be known until environmental testing is undertaken (This happens after a group is awarded site control).
14. How might we continue to work together with you if you are chosen by the city to develop Truman Olson? Are you willing to schedule plan review meeting directly with neighbors?
Welton has been committed to involving the neighborhood and have attended numerous meetings to answer questions about our proposals. We have also been upfront and forthcoming with our ideas and concerns. We would continue that same approach as neighborhood buy-in for the development is critical for success.