Hoping to address the dearth of available homes in their community, the landlocked city of Sheboygan has purchased 197 acres of farmland in the neighboring Town of Wilson for $3.67 million.
The plan, said Chad Pelishek
, the city’s director of planning & development, is to annex the property and then work with developers to transform various sections of the parcel, and an adjacent 73 acres property, into 270 acres of available land that can be used for residential development.
The 197 acres property sits directly to the east of Moenning Road, near Creekview Court, across the road from an existing subdivision. It was sold to the city by farmer David Gartman.
Although the focus will be on creating affordable single-family homes, city officials envision a mix of housing options, from starter homes for younger families, single-family condos, duplexes and even some larger homes that might sell for $750,000, Pelishek said.
The city was prompted to make the move after an affordable housing study revealed the municipality needed to create another 1,000 single-family housing units in the next five years, he said.
“This city of Sheboygan is landlocked, so this is really the only opportunity the city had to expand single-family residential. So we worked with this farmer to expand to the south with this property,” Pelishek said. “The reason the city took it on, versus somebody else, is because Mr. Gartmen didn’t necessarily want to work with a developer, and he wanted to work with the city and see his land be developed in the city versus the town. We also felt if we were to buy it we could have a little more control over the final development product and be able to work with developers to try to keep the cost of the land more affordable, so we could encourage them to build homes for a more affordable price (for buyers).”
Municipalities will sometimes purchase land for municipal developments, like a new city hall or business park, but it is unusual for a city to buy land for private housing developments.
Oddly enough, however, this isn’t the first time Sheboygan has taken such steps to provide affordable housing for its residents. In addition to the 197 acres, which its added to 73 acres it already owns, it purchased a parcel about 15 years ago that it divided into single-family lots and sold off.
“Given the current construction costs for single-family housing, and the costs related to just acquiring land, we thought it made sense for us to try to purchase (the 197 acres) and try to keep the prices down, so we could encourage more entry-level family homes,” Pelishek said.
The city plans to pay for the land in installments over the course of the next five years. The first payment was $900,000, and subsequent payments will be around $693,000, he said. Some of that money will come from the city’s affordable housing fund, and some from money remaining in the accounts of now-closed tax incremental financing districts.
The goal is to make most of the payments without any borrowing, Pelishek said.
The Common Council must still pass a resolution to officially annex the land into the city, but officials are already talking to developers.
“We are trying to masterplan the site to see how it can flow. We will be laying that out in the coming months here, and then doing some wetland delineations,” Pelishek said. “We have looked at this as an investment in housing for the next five to seven, maybe even 10 years.”
