Sheboygan needs more housing inventory. Just imagine going to a grocery store that only had chicken on the shelf to buy — no beef, pork, ham, or bratwurst. This is an example of what’s happening in the Sheboygan housing market in recent years. During the period from 2008 to 2014, there was limited development of multifamily and single family housing in downtown Sheboygan and throughout the City of Sheboygan.
Because of this drought in housing, new employees coming to the area have had to live further away to find the type of home that they want because they could not find locally. Data from the American Community Survey estimates that 13.8% of our workforce commutes in to Sheboygan County daily to work. We have about 62,000 persons employed and 8,600 who commute in to their job from out of the county.
Sheboygan has had approximately 3,000 jobs available for all of 2016 and 2017. While county employers have been filling many available jobs, the good news is that even more jobs have become available. These new workers have helped reduce the inventory of available housing.
As new employees come to Sheboygan seeking a home or apartment they have been thwarted by the lack of inventory to consider for their future residence. Sheboygan County had less than a 1 percent apartment vacancy rate according to a 2014 study. While new apartment projects have allowed for additional choices, subsequent analysis reveals the vacancy rate has not increased.
As a new projects open for occupancy they are filling up quickly. On South Pier, the Portscape Apartments phase 1 was completely filled last year. Phase 2 of Portscape is under construction and half of the 33 additional units are already pre-leased. The Encore project built on the former Boston Store site is 80% leased. The High Pointe project construction will finish this year and they recently began leasing. The Washington School historic renovation is complete; the 41 units available are filling fast.
While these new apartments are starting to address the housing market need in Sheboygan, the demand for new housing inventory continues to grow. If a new worker comes to Sheboygan to take a job and they live outside of the city or county, we as a community don’t reap the full benefit of their employment at a local business. In some of our business development programs we incentivize businesses based on job creation. But when the employee filling that job lives in Cedarburg, we do not receive the full benefit for subsidizing that job at a local business. This also harms existing and prospective retail.
What is the per year impact on our local economy? If 100 additional workers with an average salary of $48,133 (a total of $4.8 million) were to find housing in Sheboygan, then the spending of these residents will create wages and jobs for others. The spending will also be a boost to our local businesses. It is estimated that these 100 residents will spend $150,000 for furniture and appliances, $342,000 for grocery store sales, $258,000 for restaurant meals, and $342,720 for vehicle purchases and auto service each year. That totals over $1 million of commercial activity to benefit local businesses.
This also means that 100 more homes or condos could be built within the area to house these individuals and families. On the low end, 100 more units that appraise at $200,000 would generate $476,000 in property taxes at the City’s current mill rate. These tax dollars could then be budgeted for additional city priorities like more street resurfacing, fire and police needs, and producing some tax relief for the current property taxpayers.
People see some of the new housing projects as meeting the need for housing, but actually we are just scratching the surface. Acuity just announced that they are hiring an additional 100 employees to accommodate their business expansion. They, along with other local manufacturers, will continue to hire staff that I would like to see live in Sheboygan so that we can continue to grow our local economy.
This column was submitted by Sheboygan Mayor Mike Vandersteen.