Shorewood — The developer that built the Shorewood Metro Market and adjacent parking structure is preparing to sell those properties to an undisclosed buyer that does not need the $6.5 million loan originally offered by the Shorewood Village Board in 2014.
The development agreement reached between the village of Shorewood and General Capital Group in 2014 outlined a $13.8 million village contribution for the $45.7 million project. Shorewood agreed at the time to contribute a $5.5 million grant and a $6.5 million repayable loan after construction of all phases of the building was completed.
Metro Market rents its building from General Capital, and the sale of the building will not affect the grocery store. General Capital Group President Michael Weiss confirmed Metro Market will continue to occupy the space after the sale.
The prospective buyer of the grocery store and parking structure properties does not have a need for the $6.5 million loan, so on Monday, Dec. 12, the Shorewood Community Development Authority voted to remove the loan from the development agreement. The Shorewood Village Board will discuss the matter Monday, Dec. 19.
Village Manager Chris Swartz said the village does not know the prospective buyer or the terms of the offer. That information is expected to be released earlier next year once the closing documents are finalized.
Swartz said the removal of the $6.5 million loan from the developer agreement would reduce the amount the village needs to borrow, which increases its borrowing capacity. The removal of the loan would also reduce the lifespan of the Metro Market tax incremental finance district. The TIF district was originally expected to close in 2028, but now it would close in 2024 or 2025.
The development of the Metro Market, parking structure and six-story Mosaic building is expected to turn a $7.5 million property into a $37.8 million property, creating an additional $30.2 million in incremental value for taxing entities.
That increment will be used to help the village recoup its investment until the time the TIF closes, at which point the additional value will start generating revenue for the tax rolls. During the TIF's lifespan, though, taxing bodies will only receive tax revenue on the base value of $7.5 million, foregoing the additional tax revenue created by site improvements.
The Mosaic is expected to open in March. Ground-floor tenants include Orangetheory Fitness and Mod Pizza, a Seattle-based build-your-own pizza restaurant. The building has space for four to five retailers within the 15,700 square feet of ground floor retail space. The top five stories of the building will feature 96 luxury apartments.