Providing employment opportunities, small
businesses loans and quality, affordable housing for
Madison and Dane County residents.
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TESTIMONIALS

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The Venture Debt Fund is a perfect vehicle for fast growth companies like Forte Research. It provided cash to support growth when we were too risky for traditional bank financing and allowed us to focus on our business instead of the fundraising process.

- Srini Kalluri
Founder
President & CEO& Chief Customer Experience Officer
Forte Research Systems, Inc.

BLOG

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  • Annual Meeting Message

    Madison Development Corporation (MDC’s) goal is to provide quality self-sustaining jobs through loans to small businesses and innovative businesses. MDC also provides affordable housing for Madison and Dane County residents.

     
  • 2014-2015 Accomplishments

    Loan Activity

    Small Business Loans: In 2014, MDC closed on $763,000 of CDBG-funded new direct loans to 9 small businesses. We also closed on 4 loans for $180,000 from our County-wide, Dane County Development Company fund. Through our Venture Debt Fund, we committed and closed on 5 loans, totaling $1,825,000. Strong loan volume has resulted in a growing loan portfolio for year-end 2015, continuing a three year trend.

     

2014-2015 Accomplishments

Loan Activity

Small Business Loans: In 2014, MDC closed on $763,000 of CDBG-funded new direct loans to 9 small businesses. We also closed on 4 loans for $180,000 from our County-wide, Dane County Development Company fund. Through our Venture Debt Fund, we committed and closed on 5 loans, totaling $1,825,000. Strong loan volume has resulted in a growing loan portfolio for year-end 2015, continuing a three year trend.

Technology loans continue to dominate our activity, especially in dollar terms, due to the larger loan limits and size of Venture Debt loans. These loans also leverage 5 times, or more, our loan amounts in financing from other equity and debt sources. We also saw strength in 2014, in a new cluster, local foods. We closed two new loans- one to a local meat processor, now selling nationwide, and a local bakery that installed a new flour mill with MDC help. They will now source their grains form local growers.

Job Impact

In addition, we continue to see good job reports coming in from our borrowers. MDC loan recipients in 2014 employ 775 people. Borrowers hired an additional 185 new employees in 2014! Of these, 133 were full-time and 52 part-time. Most jobs fit our definition of “quality” new jobs. 123 of the new jobs pay at least 2 times the Federal minimum wage, and 101 of the full-time jobs provide benefits such as health insurance. Our borrowers hired 36 people who were previously unemployed, and roughly half were low- or moderate-income prior to being hired.

Our direct lending continues to impact previously underserved businesses as well. In 2014, 3 loans went to woman-owned or managed businesses. Twenty-eight of the new hires were minority individuals.

Affordable Housing

In 2014 and continuing through 2015, MDC maintained its commitment to providing quality, affordable housing to low- and moderate-income residents in Dane County, where we own and manage 220 apartments. Surveys of MDC’s tenants continue to show that over 80% of the residents of our affordable housing properties are below 60% of the local median income. Additionally, 71% of our tenants are below 50% of median income. This shows our dedication to truly affordable housing, in keeping with our Mission.

In 2014, MDC demolished 3 dilapidated houses on South Park Street that were plagued by significant deferred maintenance and lax tenant selection, resulting in a large number of police calls. These have now been replaced with 11 new townhouse apartments. The new “Dane Townhome” apartments include some of the largest units with the best amenities in our portfolio. They include 6 two-bedroom apartments and 5 three-bedroom units, all with private under-unit garages, individual washers and dryers and energy efficient appliances. We leased the new units in December 2014 and January 2015. Nine of the 11 units are leased to low- or moderate-income tenants, 6 of which are at incomes below 50% of county median income, and another 2 are below 60% of county median.

We also re-invested over $1 million in our Bassett Warehouse Apartments at Bedford and West Washington. These 27 apartments were converted in 1981 and are now fully updated and remodeled. We invested in substantial façade improvements to bring the exterior masonry construction up to “as new” condition. We also installed a new elevator, replacing one which was plagued with breakdowns, and heating improvements which will add longer life and more energy efficiency to the building’s major systems.

Looking Forward

Our major new initiative in 2015 is to plan a substantial redevelopment of new affordable housing on the 400 block of West Mifflin St. We finally purchased a house that gives us 3 adjacent lots, and a buildable site for 45 to 55 new apartments. We are now working with our architect and the neighborhood, Alder, and City staff to plan a project that will meet their expectations and allow us to substantially increase affordable housing in downtown, where little exists. On the contrary, most new apartment construction in downtown is high-rent, and frequently replaces older, “de-facto” affordable but substandard units.

In addition, we received an award of an additional $1.5 million of capital committed by WHEDA to our Venture Debt Fund, as well as an increase from MG&E for another $500,000. This brings our capital available for Venture Debt to over $8 million, allowing us to increase the impact of the program.

Madison Development Corporation 550 W. Washington Ave. | Madison, WI 53703 Tel. 608-256-2799 Fax 608-256-1560
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