It’s been nearly a decade since an apartment building has been constructed in Janesville, and the city has felt the effects of low vacancy.

But with the recession in the rear-view mirror, Economic Development Director Gale Price predicts that new apartment buildings will be springing up soon.

“There are parties interested in building apartments in Janesville because they see a need,” he said. “I think somebody is going to try awful hard to be digging in the ground in the spring.”

That’s good news, Price said, considering the plan commission recently shot down a proposal to build high-end apartments on Rotamer Road.

The 93 proposed units would have made a dent in the demand for rentals. Janesville’s current apartment vacancy rate is less than 1 percent, and Price predicts that the city needs at least 250 units to bring the vacancy rate to a healthy 5 percent to 8 percent.

The lack of rentals carries a cost: Among other things, it makes it harder for businesses to attract the workers they need.

Looking for sites

With the Rotamer Road proposal off the table, city officials are looking at other choice spots for apartment development.

A parcel for sale just south of Rock County Honda, 3636 E. Milwaukee St., is zoned for business but could be a prime spot for apartments. Land across Wright Road from New Life Assembly of God also is zoned for business but sits next to other apartments, making it another good spot for rentals, Price said.

The city also has other pockets of land that could be used for apartment development. Some wouldn’t have to be rezoned, he said.

It’s more common for the city to rezone property than to annex land for apartment developments. Annexation applies to cases in which a piece of land needs city utilities, Price said.

Any proposed rezoning has to line up with the city’s comprehensive plan, which outlines how areas are zoned for future development. The comprehensive plan is adaptable, so it can be amended to allow for rezoning, officials have said.

The last apartment development built in Janesville was the Woodsview Apartments on Park Place Lane in 2008. Then the recession hit, and no apartments have been created in the city since then, Price said.

“It’s been a long, long time,” he said.

Market demand

Janesville Area Rental Property Association members see the need for more apartments.

“We receive calls on a regular basis asking if we have any openings. The people report they cannot find any decent housing to rent,” association member Cindy Haberman wrote in an email.

When the vacancy rate is as low as it is, tenants don’t have many options if they want to upgrade or move somewhere else in the city, said Price and city council President Doug Marklein, who has expressed concern about the lack of rental units.

With a higher vacancy rate, renters could freely upgrade to nicer, more expensive apartments, leaving cheaper apartments up for grabs, Marklein said.

“It’s very healthy to have that vertical mobility on rentals,” he said.

Low vacancy also doesn’t allow elderly residents with few retirement resources to find low-income housing, which is a growing market, Price said.

Landlords are taking advantage of the low vacancy rate, he said.

“It’s a landlord’s market, and they can adjust their rent up without really doing a whole lot to them (the buildings) because demand is there,” he said.

With SHINE Medical Technologies, Dollar General and other businesses moving in, Janesville has created hundreds of jobs in the past couple of years. But with a low rental vacancy rate, people might hesitate to take a job and move here, Price said.

“We don’t want people to think twice about taking a job with one of our great companies because they don’t think they’re going to be able to find a place to live,” he said.

A ‘perfect’ plan

A developer earlier this year expressed interest in developing 93 high-end apartment units on a 10-acre parcel on Rotamer Road, between the Briar Crest subdivision and the Wal-Mart and Sam’s Club stores.

The development would have required amending the city’s comprehensive plan to allow rezoning of the property from R1, single- and double-family homes, to R3M, multifamily units.

Marklein, who also sits on the plan commission, called it the “perfect project” for the site.

“It’s exactly what should have gone there,” he said.

The plan didn’t sit well with neighbors in the Briar Crest subdivision.

Some neighbors—along with Marklein—insisted the land had to remain R1 because of promises made between the land owner and the city. Years ago, the land owner allowed the city to apply business zoning to parcels now occupied by Wal-Mart and Sam’s Club as long as the 10-acre parcel in question remained a buffer zoned R1, Marklein said.

“You get pushback from people who don’t want to see apartments near them,” Price said. “That’s always a bit of a challenge.”

The land owner didn’t show up at the plan commission’s meeting to make a case for rezoning the area, so Marklein voted against the development with the rest of the plan commission.

But the need for apartments remains.

Typically, a city of Janesville’s size has one complex being built at any given time. Fortunately, developers see Janesville’s need and are ready to fill it, Price and Marklein said.

“I think someone is going to find a way to get some apartments built. It’s going to happen,” Price said.

Added Marklein: “The market will take care of itself.”

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