Seven years ago, after negotiations over city assistance for a development on the 800 block of East Washington Avenue soured, Gary Gorman vowed never to work in Madison again.
Gorman had invested two years in “Avenue 800” — initially proposing an $85 million mixed-use project with 309 condominium units in nine buildings, later downsizing it after the city balked at his initial request for $7.8 million in tax incremental financing (TIF). The two sides eventually parted ways over a $1 million difference in TIF, leaving the high-profile parcel next to Breese Stevens Field vacant to this day.
It wasn’t the award-winning developer’s first dust-up with the city.
Gorman previously was stymied by neighborhood activists from razing the aging Quisling Clinic at 2 W. Gorham Street to make way for a seven-story, 101-unit apartment. While the art moderne structure was eventually redeveloped into 60 apartments, Gorman maintains he lost money on the deal.
“I won’t say I wouldn’t do another downtown Madison project, but you have to weigh the rewards with the risks,’’ he told The Capital Times in a 2001 interview. “And working your way through that approval process is certainly part of the risk.’’
But all that history appears forgotten amid a resurgent real estate market, the unquenchable thirst among medical providers for more space and a city administration willing to open its pocketbook for the private sector.
Last week, Gorman & Company inked a deal with the city to rescue the long-stalled Union Corners site at the corner of East Washington Avenue and Milwaukee Street. Anchoring the proposed $84 million project is a 60,000-square-foot UW Health clinic.
Back in 2003, before the housing bust sent the national and local economies into a tailspin, developer Todd McGrath had plans to turn the 11-acre Union Corners site into a mix of high-density housing, shopping and open space. The $70 million project was widely hailed as a game-changer, something that would finally spur development up and down the blighted East Washington Avenue corridor.
When the recession hit, however, all those dreams were drowned in a river of debt, and McGrath ended up losing the property in a voluntary foreclosure. The city of Madison eventually stepped in, buying the land from M&I Bank for $3.57 million, with the expectation it could eventually find a private developer to take over the site once the economy improved.
Enter Gary Gorman, who is back working with the city on the Union Corners site after his proposal was selected by an ad-hoc special committee in November when competing developers dropped out.
In an interview last week, Gorman explained there was nothing special about his decision to jump back into the local development game. He was approached by UW Health officials about building a new clinic at Union Corners and decided to take a look.
“That is what really sparked it,” says Gorman. “An opportunity presented itself.”
UW Health officials are ready to get moving. The provider was looking to replace its aging East Towne Clinic and also has a track record in working with Gorman, who bought the Quisling Clinic from UW Health 15 years ago.
“We were very impressed with the way he worked with the community and neighbors in the area as well as coordinating with the city staff and departments,” says UW Health spokeswoman Lisa Brunette.
Not everyone sees it exactly that way.
Former Madison Mayor Dave Cieslewicz, who was involved in the failed TIF negotiations with Gorman on 800 East Washington back in 2006, notes Gorman’s past support for current Mayor Paul Soglin. Gorman had backed Soglin in his 2003 upset loss to Cieslewicz and again in 2011 when Soglin turned the tables on Mayor Dave.
“I liked Gorman’s proposal for East Wash, but he was asking for an exotic financing mechanism that drew the strong objections of city staff and was rejected by the Board of Estimates,” says Cieslewicz. “It’s ironic that he’s now reviving Union Corners.”
Campaign finance records do show Gorman contributed $250 to Soglin in his run against incumbent Mayor Cieslewicz in 2011. Gorman also backed Soglin in 2003 when he was surprised by Mayor Dave. But Gorman maintains the change in the mayor’s office had no bearing on his decision to tackle Union Corners.
“There was nothing political about it at all,” he says.
And it’s not like Gorman, a 1973 graduate of Monona Grove High School, has been sitting on the sidelines stewing over deals gone bad. On the contrary, his firm has been busy working in a variety of markets outside Wisconsin, even tackling an affordable housing project in Gulfport, Miss., in the wake of Hurricane Katrina.
In fact, Gorman & Company has carved out a national reputation for downtown revitalization and historic renovations using tax credits and other creative financing vehicles. Rather than having to look for business, the firm has found itself sought out by cities looking for developers willing to work in old factory districts or troubled inner-