Gift From Herb Kohl Philanthropies Fuels Owner-Occupied Affordable Housing Efforts
Community Development Alliance leading effort to create 42 homes for early childhood educators.
JoAnne Anton. Photo by Jeramey Jannene.
Herb Kohl‘s legacy in Milwaukee now includes creating housing for early childhood educators.
The late senator’s foundation, Herb Kohl Philanthropies (HKP), announced a $1 million gift on Wednesday to the Community Development Alliance and Acts Housing to help fund the development of eight homes for early childhood educators near the Malaika Early Learning Center in the Harambee neighborhood.
“We’re doing this for two principal reasons,” said foundation president JoAnne Anton at an event Wednesday at Malaika. “One of our mantras every day is ‘we love teachers.’ That includes early childhood educators. Unfortunately, the early childhood education sector is struggling. It is a broken system. It is one where early childhood educators go to work every single day getting paid less than they deserve.” Anton said the foundation was moved to support educators and to support the collaboration that is occurring around providing more affordable housing in Milwaukee. “We view our million dollar contribution as an investment, one that’s vital to children, one that’s vital to families, the workforce and our future in Milwaukee.”
The three-bedroom, 1,000-square-foot homes are part of a 42-home development being built around five early childhood education centers. The houses will be sold, through a lottery system, for approximately $100,000 to qualifying early childhood educators who make less than $50,000 per year. They’re one of many projects that aim to address a bigger goal the CDA is advancing to eliminate racial disparities in housing.
“We don’t swing any hammers,” said event emcee and CDA chief alliance officer Teig Whaley-Smith in praising the organization’s many partners.
There are several partners making the early childhood educator (ECE) home effort possible. The Wisconsin Department of Workforce Development provided a $5 million grant. The City of Milwaukee is selling the lots for $1 each. A proposed tax incremental financing district would provide between $1.8 million to $2.8 million to support the development of 59 homes in Harambee, including the eight Kohl-sponsored homes and dozens of homes from Milwaukee Habitat for Humanity.
The ECE homes are expected to cost between $250,000 to $300,000 to construct. “We’re doing absolutely everything we can to bring down that cost because at the end of the day what early childhood educators can afford is a home that’s about $105,000,” said Whaley-Smith. With down payment assistance, the buyers will have a mortgage of approximately $85,000. A mix of public and philanthropic support is being used to fill the gap between the sale price and the construction cost. Due to rising costs, CDA has also trimmed its initial goal of building 50 homes down to 42.
Habitat is working with emerging developer Oby Nwabuzor, who recently earned her Ph.D. in public health in addition to her real estate work through Envision Growth, to upskill and scale her real estate work on the ECE homes. The organization has already been on a multi-year journey to build dozens of homes in Harambee.
CEO Brian Sonderman said the organization now has hard data from more than 40 years of work to demonstrate the positive effects of stable homeownership on families and children, but more is needed to transform the city.
“We are going to need to build out in the housing ecosystem more developers and especially developers of color,” said Sonderman. “We need more people to gain experience and capacity to bring their talents and their energy to our city.” It has already formed the foundation of four of the eight ECE homes. All eight homes are expected to be ready next March.
“We all understand the importance of housing as a key social determinant and driver of health, and stable housing improves dropout rates, reduces crime, increases employment and leads to better health outcomes,” said Nwabuzor. In addition to her real estate and public health work, Nwabuzor serves on the board of Malaika.
Acts Housing is one of three CDA partners providing home-buying counseling to the buyers. Through a separate CDA partnership, an acquisition fund, it’s also buying homes from large landlords and reselling them to owner occupants. CEO Michael Gosman said the organization has now purchased more than 100 homes through the fund, including three in Harambee. It also continues to expand its counseling program. “We’ve helped more than 4,000 families purchase homes in the city of Milwaukee. To put that into context, that means that more than 2.5% of all single-family and duplex homes in Milwaukee are owned by an alumnus of our program,” he said. The organization will receive $250,000 from the HKP grant.
“It seems like there’s a lot of time spent on all the things we disagree on, and I understand why, especially at this moment, but in an area like this, that’s there such widespread agreement… I find it really inspiring [to see] so many groups coming together to accomplish something really meaningful and we’re just honored to be a part of it,” said Gosman.
Malaika Executive Director Tamara Johnson said addressing housing for early childhood educators helps address many of the issues the sector is facing, including high turnover and improving the quality of care. “I am of the belief that this project and resources that support it will become a game changer for professionals in our field,” she said.
Area Alderwoman Milele A. Coggs, who said she sent her son to Malaika, said she was happy to see the effort coming together in the neighborhood she grew up in.
The CDA is now a formal 501(c)(3) organization but still maintains a governance structure that engages a resident advisory council. The advisory council chair Timothy Scott praised the CDA and its partners for ensuring residents were involved from the start of all of its initiatives.
Guided by a 2021 report and plan that identified substantial racial and economic disparities in Milwaukee’s housing supply, the CDA has a goal of creating 32,000 new Black and Latino homeowners over the next three decades. On Whaley-Smith said the alliance is already seeing the needle move. “For the first time in Milwaukee’s history, we’ve seen three consecutive years of increases in the Black homeownership rate and also the Latino homeownership rate,” he said. “What we’re doing is absolutely working.”
In addition to the area around Malaika, 125 W. Auer Ave., houses are also being built around Next Door Foundation (2545 N. 29th St.); Children’s Outing Association Goldin Center (2320 W. Burleigh St.); United Community Center Ricardo Diaz Early Learning Academy (2130 W. Becher St.); and Rooted & Rising Washington Park Growing Tree Children’s Center (3940 W. Lisbon Ave.).
“If your childcare provider can’t afford to live in the neighborhood that they serve, then the whole community feels that strain,” said Department of Workforce Development Secretary Amy Pechacek.
The five organizations’ client base is 80% families of color and each of the centers is located in a low-income neighborhood. There is no racial requirement to enter the lottery, but based on the locations of the homes and affiliated child care providers, it is expected that most, if not all, of the future owners will be Black or Hispanic.
Six of the 42 homes have been completed said Whaley-Smith and five have been sold. More information is available on the CDA ECE website.
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