Hovde Properties has pulled its plans to build an $80 million, 10-story office building on the Madison Area Technical College block in downtown Madison.
According to the Wisconsin State Journal, problems with the 98-year land lease agreement caused the company to reconsider, as well as concerns about the future economy and interest rates. The Hovde office project was going to front Wisconsin Avenue between Johnson Streets and Fairchild, adjacent to a hotel project from Drury Southwest, which ended up partnering with Hovde on the block’s development.
Reportedly, Drury still plans to renovate MATC’s education center into a 197-room hotel, but now it could also replace Hovde with another partner, or it could develop the rest of the block. MATC could also seek another developer to replace Hovde’s portion.
The Hovde/Drury proposal was selected from a group of five finalists in April largely because it promised higher rent payments to the technical school.
Reportedly, Hovde’s decision does not affect plans for Madison College to vacate the downtown campus by the end of 2018 school year, so construction can begin in 2019.
