The developer who is still pushing ahead with plans to turn a former Sears building on Milwaukee’s northwest side into a boutique hotel could have another year to start paying off a $4 million loan from the city to…
The developer is still pushing ahead with plans to turn a former Sears building on Milwaukee’s northwest side into a boutique hotel could get another year to start repaying a $4 million loan from the city for the project as part of a an additional tax funding district for the site. Kalan Haywood, President of Milwaukee Haywood Group LLC approached the city in March 2019, seeking the public’s help with its plan to transform the historic building at the northwest corner of Fond du Lac and North Avenues into a full-service, 80-room boutique hotel, called the ‘Ikon Hotel, with a restaurant, lobby bar and co-working space. Plans also called for a 23,600 square foot conference center to be built adjacent to the historic building. Under the original agreement between Haywood’s company, HG Sears, LLC, and the City of Milwaukee Redevelopment Authority, Haywood had two years before it had to begin making payments on the loan, first in the form of interest-only payments, then for three years. later with principal and interest payments payable over 15 years. In August last year, the GDR voted to extend the non-payment period of the loan for another year. With that grace period due to end on September 1, the Redevelopment Authority is now proposing to give HG Sears until September 2023 to start making payments. As part of the agreement, Haywood will be required to provide monthly project status reports to the Redevelopment Authority. The board of directors that oversees the City of Milwaukee Redevelopment Authority is expected to vote on the expansion at its 1:30 p.m. meeting Thursday. When asked why Redevelopment Authority officials were recommending another extension of the grace period, a City Development Department spokesperson said, “The future of this site is important to this part of the of Milwaukee and for the entire city. We are aware of the challenges that all developers have faced over the past two years. With that in mind, we’re proposing a change to the terms to give the current developer an additional year to solidify a revised and workable plan. We look forward to realizing the full potential of this site and returning it to productive use. Haywood could not immediately be reached for comment. The Common Council also approved a loan of $5 million for the Ikon project, subject to the condition that funds from the second loan cannot be spent until other sources of financing for the project have been tapped. Haywood has already spent most of the original $4 million loan acquiring the property and interior demolition at the site, according to the city.
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