Sean Ryan, a reporter for the Milwaukee Business Journal, recently met with Paul Dincin, managing partner of Catapult Real Estate, to discuss the purchase of downtown Milwaukee, Wisconsin’s Underwriters Exchange Building and its transformation into Streetcar Flats.
Streetcar Flats has achieved remarkable success just weeks after opening its doors to residents. With 85% of its 75 apartments already leased, the development has exceeded expectations for the $12 million restoration project.
Dincin purchased the nearly century-old former Underwriters Exchange office building in 2018. At that time, the nine-story building located on North Broadway was only half occupied.
Despite consultants warning him about the challenges of obtaining a federal historic designation to access tax credits for the conversion into apartments, Dincin and his team persevered. Sitting in the beautifully restored lobby of the Streetcar Flats, Dincin expressed his satisfaction with the successful outcome.
Beneath the surface of the building, originally intended to serve as regional offices for national insurance firms, lay a wealth of untapped potential. Dincin’s historic consultants made exciting discoveries during the restoration process. As they tore up the carpets, they uncovered stunning terrazzo floors in the lobby and hallways. Unlike many of Milwaukee’s industrial buildings with damaged hardwood floors, the floors of the Underwriters Exchange offices were often in excellent condition beneath the carpet. Additionally, intricate plaster trim was concealed behind the drop ceilings, waiting to be revealed.
The building’s design played a crucial role in the successful transformation. The existing layout allowed for the preservation of central corridors and large windows, perfectly aligned with the vision for the new apartments.
“It honestly just seems like luck, a blessing,” remarked Dincin. “The geometry of the building, being a perfect rectangle to start with, was what really made a difference.”
The significant gap of nearly four years between the purchase and closing of the property was primarily due to Catapult’s efforts to address the leases of the existing tenants in the building. Additionally, they had to collaborate closely with consultants to secure the property’s historic designation, ultimately allowing them to access valuable tax credits.
In January 2022, Catapult successfully closed on its construction loan with Old National Bank, marking the beginning of the $12 million restoration project. The first apartments in Streetcar Flats became available to tenants in May, with the leasing process handled by Founders 3 Commercial Real Estate Services.
Currently, contractors are in the final stages of completing the larger three-bedroom apartments located on the top floors of Streetcar Flats. Excitingly, 14 move-ins have already been scheduled for July, showcasing the strong momentum of the project.
According to Dincin, most renters in the building are young professionals. Streetcar Flats primarily offers studio and one-bedroom apartments, eight two-bedroom units, and three larger three-bedroom options. The monthly rental prices begin at approximately $1,100 for the studios and can go up to $3,500 for the three-bedroom apartments.
Dincin emphasized that the tenants at Streetcar Flats are financially stable, and the rental rates are affordable.
As Streetcar Flats continues to achieve high occupancy rates, Dincin expressed his ongoing search for additional buildings in downtown Milwaukee. While his Chicago-based firm primarily serves as an owner’s representative consultant for projects owned by other companies, they occasionally take the lead on their own ventures, such as the successful development of Streetcar Flats.
“I’ve been actively seeking more buildings downtown,” Dincin revealed, highlighting his enthusiasm for expanding their portfolio in this vibrant location.