Bank’s backing lifts Fowler Lake condo project
CDA’s concerns about city’s financial risk apparently allayed, assessment of land slated for swap being made this week

By Ryan Billingham - Enterprise Staff

June 26, 2014

A rendering of the northwest corner of the Fowler Lake Village project proposed for Oconomowoc.
Submitted rendering

OCONOMOWOC — The Community Development Authority on Tuesday recommended the development agreement between Fowler Lake Village, LLC, and the city after it was announced that First Bank Financial Centre decided to back a $6.4 million loan.

Fowler Lake Village is a $18 million, 32-unit mixed-use complex in development for a parcel of land behind City Hall.

Economic Development Director Bob Duffy said FBFC has come forward and offered to purchase the bond for private placement, which would “essentially eliminate the city’s financial risk,” he said.

The risk involved with the financing of the developer’s agreement was one of several concerns expressed by CDA members and the public.

T he assessed value of the land the city plans to swap with developer Jeff Seymour for properties he owns on St. Paul and Pleasant streets has not been established. However, Duffy said an appraisal has been commissioned and should be back to the city within the week.

A rendering of the southeast corner of the Fowler Lake Village project proposed for Oconomowoc.
Submitted rendering

Milwaukee-based attorney Bruce Block, who has previously worked with the city on financing development projects including an unsuccessful attempt by Seymour to build a condo development on what is now the Village Green, explained that the city now has very little to fear as it will no longer be liable for nonpayment of the loan.

“The twist that Mr. Duffy talked about tonight, it does appear there is a lender out there that is willing to instantly take the position of providing this mezzanine loan in exchange for a revenue bond issued by the CDA and city. It means effectively we’re privately placing this debt,” Block said.

After Block’s explanation, Mayor Jim Daley moved to amend the development agreement’s language so that it reflects the new arrangement. The motion was approved. The development agreement was approved shortly afterward.

The CDA first approved a motion to grant a favorable opinion of how the the concept plans of Fowler Lake Village fit the city’s downtown revitalization plan.

Duffy said the development fits the plan well, and said that one of the preconditions in the agreement is that 70 percent of the value of the project be sold before the loan money is given to the developer. Daley emphasized that the project will have an ownership component that has been part of the city’s downtown plan for years.

“This is something that has been identified as a need for the downtown for 10-plus years,” he said. “We’re trying to identify solutions to work through the shortcomings of our downtown.”

The approval is the next step in a longer process.

“We’re not in final design phase,” Duffy said. “We’re here today because we entered into a ... (good) faith indication to the developer that they are able to move forward and put some elements together and that we would continue to move forward in a partnership.”

The CDA will need to act further on the development, as will the Plan Commission and the Common Council.