Wisconsin Housing Preservation Corp.’s proposal would create 200 apartments, including 150 units for those making between 50% and 80% of the Dane County Area Median Income, commercial space and 262 underground parking spaces at 200 Wisconsin Ave., a block from Capitol Square.

“We have the opportunity to do affordable housing on a Downtown site,” WHPC chief operating officer Michael Slavish said, adding that the property is close to lots of jobs and good public transportation. “We feel this site is great for that.”

MATC closed its Downtown campus in spring 2019 to make way for its Goodman South campus at South Park Street and West Badger Road.

Missouri-based hotel company Drury Southwest had been renting the entire site from MATC, also called Madison College, and had received city permission to develop a 310-room hotel there. The plans called for redevelopment of the six-story MATC building into the 195-room hotel, with the vacant land along Wisconsin Avenue to be replaced with an eight-story hotel addition.

The initial ground lease called for construction between 2019 and 2022, but the COVID-19 pandemic stalled the project.

“This block has been sitting in ruins,” said Downtown Ald. Mike Verveer, 4th District. “Redevelopment of this block is now long overdue. I welcome movement and certainly providing affordable housing at this site is a wonderful goal.”

WHPC is negotiating with Drury to allow the nonprofit to develop the proposed 12-story workforce housing project on the vacant land.

Drury could still pursue a renovation of the MATC building, a national landmark eligible for federal and state tax credits, into a hotel, or another developer could arrange to pursue renovation to a hotel or market-rate housing there. The fate of the full block could become clearer in coming weeks or months. Drury officials could not be reached.

The city’s zoning code allows eight stories at the site plus an additional two stories for factors like an exceptional design. WHPC, however, could seek a planned development that would need City Council approval to reach the proposed 12 stories.

Even at that height, the project would still be below the Capitol view height limit, Slavish said.

The new building would offer 32 studio units, 113 one-bedroom units and 55 two-bedroom units. Forty units would be for those making up to 50% of area median income, or $33,000 for a household of two; 110 units for those making up to 80% of area median income, or $53,950 for that household; and the remaining 50 units would be market rate.

“I wish it was a 100% affordable housing project,” Verveer said, noting that the city will be creating a tax incremental financing (TIF) district in the area that could provide money to make the development even more affordable.

The building would provide 10,000 square feet of commercial space along West Dayton Street and Wisconsin Avenue. The parking garage would provide spaces for 242 cars and 262 bikes.

Among the funding sources, WHPC is seeking $3 million from the city’s Housing Forward Fund and $1.5 million from the Dane Workforce Housing Loan Fund.

The nonprofit and three other entities seeking Housing Forward funds made presentations Thursday to the city’s Community Development Block Grant Committee.

The city released a request for developer proposals to access the Housing Forward Fund in early February, with an early March deadline. The development teams made presentations to the Community Development Block Grant Committee on Thursday, and next month, city staff will present funding recommendations to the committee.

The committee will finalize recommendations and forward them to the city’s Finance Committee for consideration on June 6, and to the City Council on June 21.

Verveer intends to schedule an online neighborhood meeting on the WHPC project on May 25.