Vehicles drive past the Monterey Hotel in downtown Janesville.


The city’s plan commission Monday night unanimously approved a conditional-use permit to allow first-floor apartment units at the planned Monterey Apartments complex.

The approval is the most significant use yet of the ordinance approved in 2019 that allows for first-floor residential units in the B5 central business district.

The ordinance dictates first-floor apartments in the zoning district be allowed with approval from the plan commission as long as at least 25% of the first-floor space be reserved for commercial use.

A planned 2,145-square-foot commercial space, to accommodate retail or restaurant uses, satisfies the requirement, senior planner Brian Schweigl said.

The 90-year-old, seven-story art deco building that towers over downtown’s West Milwaukee Street corridor will shed its historical identity as the Monterey Hotel and become the Monterey Apartments—with help from a $1.7 million deal from the city approved late last year.

The city council in December unanimously approved a tax-increment financing deal to help developers Cardinal Capital Management of West Allis and longtime owner Jim Grafft redevelop the decrepit building into 51 apartment units with first-floor commercial space.

Of the 51 units, 11 are planned to be studio apartments, 34 are planned to be one-bedroom apartments and six are planned to have two bedrooms, according to a city memo.

Four units will be located on the first floor and will not be visible from West Milwaukee Street, according to plans submitted to the city.

Two residents submitted comments for public hearing on the subject.

Mick Gilbertson said he did not agree with the city’s ordinance change to allow for first-floor apartments when it passed, but he thought this project was a good use of the ordinance change.

Angela Moore, executive director of the YWCA, said she had concerns about the privacy of the clients she works with at the Jeffris Flats on Dodge Street, directly behind the Monterey Hotel. Moore’s clients are often homeless, low-income and/or fleeing domestic violence, she said.

Schweigl said he discussed concerns with Moore, including a condition added to Monday night’s approval requiring the project have a privacy fence separating the Monterey’s parking lot and the Jeffris property.

Remediation has already begun at the former hotel, and construction is slated to begin in the coming months, likely in April, a representative from Cardinal Capital said.

The project is expected to take 10 to 11 months, ideally wrapping up in February 2022.

The building opened as a hotel in 1930. Grafft bought the property in 1996 after the building already had been deteriorating for a number of years.