As construction of the Nova apartment building nears completion in downtown Milwaukee, the nine-story residential building now has an additional permitted use: hotel space.
Jumping on the recent trend of "pop-up" hotels, project developer New Land Enterprises received approval from Milwaukee's Plan Commission on Monday to allow 90 of the building's 251 units to be used for short-term rentals.
"The idea is that as we lease up, we can only rent so many apartments at once, so we have a chunk of the building that's just sitting vacant," said Tim Gokhman, managing director of New Land.
For a period of two years, the 90 units in the building, located at 1237 N. Van Buren St., would be rented out by a third-party operator that specializes in short-term leasing, according to Gokhman.
"The idea of a pop-up hotel is something that we just learned about over the last 12 months," Gokhman said. "When we were concepting this building back in 2020-2021, this was just not an option we were aware of."
Allowing short-term rentals in residential buildings is something New Land is doing in their properties around the city, but not on this scale.
In the city of Milwaukee, any building that offers more than four units for short-term rentals is considered a commercial hotel, necessitating city approval. Hotel use in Nova would be in addition to the commercial use permitted on the first floor of the building and the residential use permitted on the floors above.
Some neighbors spoke at the commission meeting, saying permitting hotel use would lead to an increase in noise, traffic and safety concerns.
"This is not a hotel," Gokhman said. "...when people hear hotel, they say, 'It's parties, it's gatherings, it's late at night people going in and out.' We don't have a banquet hall, we don't have a ballroom, there's no bar. These are people who simply don't want to stay in a hotel for one reason or another."
Although New Land will be the property management company at Nova, the short-term rentals will be operated by an outside company. Further, lease agreements for renters at Nova do not permit them to rent out their own unit as a short-term rental, according to Gokhman.
"Any concerns about additional nuisance are unfounded," Gokhman said. "...There is no one more interested in making sure that this is productive than us."
Using modern technology, the hotel operator is notified when there's smoking occurring in any units or when noise reaches a certain volume, he said.
Gokhman told the Plan Commission that he anticipates more building owners will be utilizing this new model.
"I think that this is a question that the city of Milwaukee will want to likely address from a policy standpoint because it is a business model that is now available and most likely will be back, this concept of a pop-up hotel," he said.
