Core Spaces Vote up for Reconsideration

Hi Everyone,

I’ve been on the road these last few days and am writing this blog post from Omaha. I’ll be headed back to Madison on Monday in time for Tuesday’s Common Council meeting.

There are several items on Tuesday’s agenda, the most significant of which is the reconsideration of the no vote on the rezoning of land parcels for Core Spaces’ proposed student housing project at W. Johnson and Basset.

I was one of the alders who voted no at our last Council meeting on June 20th. I was particularly troubled by what appeared to be the demolition of existing affordable housing to make way for luxury student apartments. We have heard from hundreds of UW students deeply concerned about the high cost of housing and how those high costs are a major impediment to the completion of their studies. There seems to be two choices – the new, market-rate units that many can’t afford and sub-standard housing that is not that much cheaper due to the overall shortage of housing in the downtown area. Nonetheless, it troubled me to hear of these amenity-rich units being built in place of the existing housing more within student budgets.

I’ve had several conversations with staff to better understand the implications of my vote. Those conversations have principally been with the City Attorney’s office, as there’s a reasonable chance the city could be sued if our vote were to stand. I’ve also had an in-depth talk with the Core Spaces team, the developers seeking the rezoning necessary for their project. The developers recently purchased the existing units approved for demolition, and these units they now own are currently leased through August 2024. The developers claim the rents for these units are not significantly more affordable than the units they will be providing once the project is completed. If this is indeed the case, I suspect it’s due to the overall shortage of housing in the downtown area relative to demand spurred by the location’s desirability, both for students seeking proximity to campus and young professionals seeking the amenities of downtown living.

Due to a state law passed primarily in response to Madison’s inclusionary zoning policy, which was enacted during Mayor Dave Cieslewicz’s administration, we are not permitted to reject a project based on residential rents. We can offer incentives for developers to include affordable units, but we cannot mandate them. An additional complicating factor is the primary tool for subsidizing affordable housing, i.e., Low Income Tax Credits, specifically cannot be used for student housing.

There is one other important consideration. The existing housing subject to demolition consists of around 70 units with approximately 150 beds. The project under reconsideration, should it move forward, will provide 232 units with upwards of 700-800 beds.

While I’d greatly prefer a project that provided real affordable housing to the students who need it, not approving this project means the already tight downtown housing market will only get tighter, resulting in more rent increases for those same struggling students.

I don’t regret my vote on June 20th or the passion with which I spoke, but it was the wrong vote. I’m hopeful my colleagues will agree to approve this rezoning and continue to work on finding ways to create more affordable units for UW students (like the oLiv project currently under construction, also a Core Spaces project). But not only for students, but also for our teachers, nurses, and first responders, for service workers in the hospitality industry, and for the many who work in our city but can no longer afford to live in it.

Towards that end, it’s time we declared Madison’s housing crisis to be a local emergency. I will be asking the Mayor, staff, and my colleagues on Council to establish an Affordable Housing Task Force to drill down deeply on this topic. We do need to build a lot more housing to address the low vacancy rates driving rent increases. Madison is a highly desirable place to live, and we have high rates of in-migration, particularly among the Gen Z cohort, to show for it. We can’t build a figurative moat around the city and tell folks not to come here. They’re coming here, in droves, and saying no to building more housing doesn’t mean they won’t still come. In fact, they will still move here and bid up the rents for everyone else, raising rents of existing units even higher, forcing low- and moderate-income residents to leave Madison.

Nonetheless, we cannot build our way out of this crisis. We are thousands of units shy of where we need to be to meet current demand, not to mention the housing needs for the tens of thousands of new residents moving here over the next several decades. In the long-term we have a lot of catching up to do, but the human need is immediate, and the short-term, real-world consequences of our housing shortage -- the anxiety and fears faced by those who are housing insecure -- are real.

We can and must do both, build more housing, much more of it, while robustly exploring every avenue to increase affordability for those who desperately need it. To believe, as some do, that the speculative real estate market alone delivers the greatest amount of good for the greatest number of people, is a myth. Vulture capitalism is real, not just some Gordon Gecko fiction. We need a lot more social housing in Madison, and a lot more market intervention to address the profound human need our fellow residents are currently facing.

Thanks for reading this far. These are complicated issues with no easy answers. I don’t always get it right. There’s one thing I said at our meeting last month that still rings true, and that’s that we desperately need the private sector and the development community to collaborate with us in finding solutions to what’s clearly a local emergency, our city’s housing crisis.

Establishing a new Affordable Housing Task Force would be a solid next step.

Take care and stay safe,

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