Architecture Planning

RESPONSE TO CITY OF MADISON

REQUEST FOR PROPOSALS

640 EAST GORHAM STREET

DAWN O’KROLEY

07.07.11

Architecture Planning

July 7, 2011

Dan Rolfs, AICP Community Development Project Manager Department of Planning and Community and Economic Development 215 Martin Luther King Jr Blvd Room 312 Madison WI 53701‐2985

Subject: City of Madison 640 East Gorham Request for Proposals

Dear Dan,

As an architect and Madison native, it has always been a goal of mine to rehabilitate a historic property in the city for my own use. The enclosed proposal combines skillfully restoring the character of a historic building; infusing a use appropriate to the neighborhood; and well designed architecture to create a place rich in history and energy in which each component is strengthened by the other.

My experience displays my ability to design and manage projects, manage a business and lead a process that is enjoyable for team members. My appointment to the Urban Design Commission in 2008 displays my personal commitment to well designed spaces in Madison.

By providing public access and maximizing the potential of the site with two residential units, the City gains the greatest overall investment in the property and most significant increase in the tax assessment roll with the potential for increased value through future work. The opportune timing of this proposal allows for me to provide the City with maximum flexibility with an offer that is not contingent upon the sale of another property. My financial strength and the strength of this proposal is displayed in the attached proforma and as qualified by First Business Bank.

I appreciate and look forward to the opportunity to discuss this proposal with you. Feel free to contact me at 608.239.8426 or 608.204.0777, [email protected].

The undersigned has read the City of Madison’s Request for Proposals for the re‐use and rehabilitation of 640 East Gorham Street. I agree to and accept the terms, specific limitations, and conditions expressed herein. WE HAVE READ, RELY UPON, ACKNOWLEDGE, AND ACCEPT THE CITY OF MADISON’S DISCLOSURE AND DISCLAIMER, AS PROVIDED IN THIS RFP, HERE TO FULLY EXCECUTED AND FULLY INCORPORATED INTO THIS LETTER.

Sincerely,

Dawn O’Kroley, AIA Principal Dorschner|Associates, Inc.

Proposer: Dawn O’Kroley

Dorschner|Associates, Inc. 849 East Washington Avenue Suite 112 Madison, WI 53703 608.204.0777 fax: 608.204.0778

PROJECT CONCEPT STATEMENT

SITE PLAN AND CONTEXT DIAGRAM

SITE SECTION

GROUND FLR PLAN

FIRST FLR PLAN

SECOND FLR PLAN

BASEMENT FLR PLAN

PROPOSED SCHEDULE

left: outdoor living space addition at dusk, The Not So Big House, Sarah Susanka. upper right: Period Park in Mansion Hill lower right: the current unsuccessful transition on the site between public streetscape and the lake PROJECT CONCEPT STATEMENT

This rehabilitation of 640 E GORHAM STREET will serve as an outstanding example of adaptive reuse that appropriately preserves the historic character while bringing a new vitality to the property through a thoughtful and creative design to improve the quality of living and public access. The combination of skillfully restoring the character of a historic building; infusing a use appropriate to the neighborhood; and well designed architecture CREATES A PLACE rich in history and energy in which each component is strengthened by the other.

To most successfully TRANSITION BETWEEN CITY AND LAKE, a front door will be created on the park where the current private side door is located, to extend a welcoming public space from East Gorham Street into the park. Private living space will be defined by an OUTDOOR LIVING SPACE addition integrated on the North side of the building allowing the remainder of the site to have public access and improve views to Lake Mendota. Architecturally, the design of the outdoor living space will be APPROPRIATE TO THE HISTORIC STRUCTURE, express the new vitality of the site and improve views to the City from Lake Mendota. Address numbers and mail delivery will be freestanding site elements to retain the historic character of the building from the street. The restored side entry facing the park will lead to the OWNER‐OCCUPIED ground floor one‐bedroom unit. A restored front entry will lead immediately the stair to the upper three‐bedroom unit. This unit size could accommodate a family and would be ideally located in proximity to the business developments on East Washington Avenue. The fully exposed lower level allows for the future expansion of the one‐bedroom unit.

The two‐unit adaptive reuse is CONSISTENT WITH THE GOALS OF THE TENNY‐LAPHAM NEIGHBORHOOD PLAN for Medium Density Residential use. The proposed adaptive reuse is consistent with the character of the Fourth Lake Ridge Historic District and neighboring rehabilitation projects including Das Kronenberg, City Market Apartments and Lincoln School Apartments.

THIS PROPOSAL INCLUDES USE WHICH IS A CONDITIONAL USE UNDER THE CURRENT R5 ZONING. R4 zoning includes conditional use for the division of and addition to any single‐family, two‐family or multiple‐family dwelling which results in the creation of additional dwelling units therein. Side yard setback requirements or the need for a variance will be reviewed with Zoning staff following procurement of a survey.

The existing 1920 Colonial Revival Connors House (Worden House) WILL REMAIN IN ITS CURRENT LOCATION and all rehabilitation work will comply with the CITY OF MADISON LANDMARKS ORDINANCE AND THE SECRETARY OF THE INTERIOR’S STANDARDS FOR THE TREATMENT OF HISTORIC PROPERTIES. Improvements to landscape will support the historical significance of the property for its association with the Collins and Conners families as indicated in the Landmark nomination. All work will be compatible with the historic building in scale, material, color and texture and approvals from all applicable agencies will be obtained. The required improvements to meet current building codes; repairs to address deferred maintenance; and improvements to revitalize the property will respect the history of the site. The balance between preservation and rehabilitation will contribute to the character of the street and neighborhood SUPPORTING OF THE GOALS OF THE COMPREHENSIVE PLAN. The PUBLIC USE of the site will be improved through the thoughtful design of the site to more appropriately treat the edge of the James Madison Park open space and the residential Fourth Lake Ridge Historic District. This space can also strengthen the identity of the Fourth Lake Ridge Historic District through coordination with the City Preservation Planner to include a historic marker for the District as well as the property. The aesthetic of the landscape will reflect the history of this site and the connection to the lumber industry. Understanding the richness of the current James Madison Park rooftop landscape and Mansion Hill Period Park has continued to develop through the dedication of the neighbors, the City and other support, our team will be stewards of the planning efforts for the landscape design including public input and communication with the City. Funds are dedicated in this proposal to site work including the removal of the fence and existing concrete and providing new landscape. The project will gracefully transition and respect the two outstanding contexts the site holds: a beautiful natural landscape and an active urban streetscape.

Functionally, creating usable outdoor living space will create A STRONG CONNECTION BETWEEN INDOORS AND OUTDOORS, reflecting modern living and improve the quality of life provided by the site. The existing quantity of 3 parking stalls is proposed to remain, contingent upon site plan approval, with one stall dedicated to the one‐bedroom unit and two stalls allocated for the 3‐bedroom unit to best serve a family. All landscape surfaces will be redesigned with the impact of vehicles minimized. The outdoor living spaces creates a larger sense of space allowing the viability of an efficient footprint, while also serving as a second means of egress for each of the units and screening waste and recycling containers. Exterior modifications to connect the interior and exterior through the addition of doors on the ground floor proportioned to be more appropriate to the original brick lintels than the existing large window openings. Masonry removed from secondary facades will be made available for the replacement of masonry on the primary facades. All historic lintels will remain and proportions of openings will reflect the original design intent still seen in the lintel coursing. The addition will be construction on secondary facades and designed with a structure independent of the historic building with compatible materials and scale per the Secretary of the Interior’s Standards for Historic Rehabilitation.

The density is CONSISTENT WITH THE COMPREHENSIVE PLAN goals for a livable, walkable community and the plan encourages sustainable development by promoting urban infill and redevelopment. The first commitment to SUSTAINABLE DESIGN is the reuse of an existing structure. The site is a located in a community with various modes of transportation and amenities within walking distance. The location offers the opportunity for the Owner to walk to work at Dorschner|Associates, Inc., located in the former Gardner Bakery Building at 849 East Washington Avenue. Treatment of the landscape will respect the natural environment by improving erosion control and stormwater management as a part of the efforts being made to improve the quality of our Lakes. U.S. Green Building Council LEED Guidelines will be utilized when designing high efficiency systems to reduce energy and water use, or selecting materials that are regional, include recycled content or improve indoor air quality. Inappropriate materials will be safely removed through lead remediation and asbestos abatement.

The PROPOSED SCHEDULE is based on the estimated dates of the approval process provided by the City in the RFP. The proposer is able to offer the City maximum flexibility to meet your schedule. CREATE A PLACE RICH IN HISTORY INFUSED WITH BEST USE A THOUGHTFUL REHABILITATION WITH APPROPRIATE NEW DESIGN ELEMENTS

COMPLY WITH THE SECRETARY OF THE INTERIOR’S STANDARDS

INSTALL MARKERS TO IDENTIFY THE HISTORIC PROPERTIES AND THE DISTRICT

EXTEND PUBLIC ACCESS FROM GORHAM INTO JAMES MADISON PARK REDEFINE THE PRIVATE SIDE DOOR INTO A PUBLIC FRONT ENTRY

LOCATE THE SEMI-PRIVATE OUTDOOR LIVING SPACES ON THE NORTH FACADES

EASE TRANSITION FROM CITY TO LAKE

REMOVE FENCE AND CONCRETE, INTEGRATE LANDSCAPE

IMPROVE VIEW TO AND FROM THE LAKE

PUBLIC ACCESS

IMPROVE PUBLIC ACCESS

WALKABLE, LIVABLE COMMUNITY INCORPORATE SUSTAINABLE DESIGN PRINCIPLES WALK TO WORK WITHIN A 10 MIN RADIUS

I U

V I

N P

S R

PUBLIC ACCESS PUBLIC ACCESS

Proposed Schedule 640 E Gorham Street prepared by D. O'Kroley

Schedule is based on the approximate range included in the RFP. Schedule and public meetings indicated are flexible to meet the City approval process.

2011 2012 spring 2013 JASONDJFMAMJJASOND

City Review of Proposal/interview Public Meeting Common Council Selection Zoning CUP Approval Construction Documents Landmarks Approval Wisconsin Historical Society Approval Public Meeting Popular Referendum Closing and Approvals Notice to Proceed, procure permits Construction Substantial Completion Public Meeting: Public Access Site work improvements to Public Access Final Approvals, tax credits, publication Site work Substantial Completion

Notes: Future care and maintenace will be provided by Owner. Proposer occupancy date is flexible, option to occupy prior to referendum. Key milestones: April 2012 Popular Referendum August 2012 Substantial Completion Spring 2013 Site Work Substantial Completion

DEVELOPMENT TEAM

FIRST BUSINESS BANK REFERENCE AND FINANCIAL STRENGTH VERIFICATION

right: my grandmother, front, was born in Madison in 1911 and displays in this 1938 photograph her clear love for the lakes. This project and the treatment of the site will include research through the Wisconsin Historical Society to ensure the design conveys a sense of Madison’s history, the Collins and Conner families and the lumber industry. DEVELOPMENT TEAM

The proposed adaptive reuse will be PRIVATELY OWNED in support of the goals of the neighborhood. Dawn O’Kroley will be responsible for the rehabilitation, management and ongoing care and improvement of the property. Upon acceptance of this proposal, a business entity specific to this property named FLR (pronounced floor, derived from Fourth Lake Ridge Historic District), will be finalized with Dawn O’Kroley as owner. FLR will be registered as a DBE, WBE and SBE with the City. The proposer will be the architect and project manager to lead a collaborative approval process, thoughtfully engage the neighborhood in the public access design, actively be involved in the construction and OWNER OCCUPY the first floor unit. Accounting, legal and leasing professionals round out the team and additional information will be provided upon request.

As displayed in our work and Dawn’s contribution to serve the City as an Urban Design Commission member, our team is committed to the success of this project through the preservation of our City’s historic structures and natural landscape while creating a place that contributes to the community and economic development of the City.

The team includes:

Dawn O'Kroley, AIA

Dawn is a principal at Dorschner|Associates, Inc., an architecture and planning firm located in Madison that provides creative design solutions in support of the goals of our clients. Dawn brings her sense of design to all project phases as project architect and project manager including projects for the State of Wisconsin and local municipalities. Dawn received her Master of Architecture degree from the University of Wisconsin, Milwaukee with a Certificate in Historic Preservation. She became a principal in 2005 and has worked in the profession over 10 years. Her interest is in the preservation of buildings in an urban context concurrent with the continual transformation of the built form to bring a sense of time and history to place. She was appointed as a design professional to the City of Madison's Urban Design Commission in 2008.

Dorschner|Associates, Inc. is a full‐service architecture and planning firm that provides creative design solutions in support of the goals of our clients. We provide outstanding programming, construction documentation and construction phase administration services. Our team includes four licensed architects and two technical staff. The Dorschner|Associates, Inc. team has a wealth of experience with government, civic, multi‐family residential projects including sixteen projects listed on the National Register of Historic Places. The firm was founded by Diana Dorschner in November 2000 and is certified in the City of Madison as a Women Business Enterprise (WBE), Disadvantaged Business Enterprise (DBE) and a Small Business Enterprise (SBE).

Dorschner|Associates, Inc. related work includes public buildings, buildings located in parks which are sensitive to a natural context, multi‐family residential design, the historic rehabilitation of over sixteen properties listed on Historic Registers and several municipal projects which included financially responsible design solutions and public input. A brief description of Dorschner|Associates, Inc. related work includes:

Historic Survey and recommendations for window detailing appropriate to the historic structures with Gorman & Company for the conversion of the Moline High School into residential lofts; the Mitchell Wagon Factory rehabilitation into artist’s residences; the renovation of the former Majestic Theater and the award winning Dr. Wesley L. Scott Housing Historic Rehabilitation.

Multi‐Family experience includes several phases of the Crosswinds Condominium 16 unit buildings and two‐unit buildings, including walk‐out lower levels. Dawn was also a design team member on Metropolitan Place Phase I and the Oakwood Village West apartment building while with HSR Associates, Inc. We recently worked with City staff to obtain approvals for the Tamarak Studio and Gallery live‐work unit. We are currently completing an adaptive reuse of a 4,000 SF commercial building with residential apartment at 118 N Franklin Street in Verona.

The Brittingham Boathouse is an example of our public building restoration work completed for the City. The relocation, restoration and addition project received the 2007 Preservation Award from the Madison Trust for Historic Preservation and the 2007 Preservation Award from the Wisconsin Historical Society.

Our work with the DNR includes the Newport State Park Visitor’s Center and the Harrington Beach State Park shelter. For the Wisconsin Historical Society we have completed restoration work at two historic visitor center sites: the First Capitol Court and Council House and the Stonefield Historical Site.

Also for the State of Wisconsin, University of Wisconsin‐Madison, School of Human Ecology, we completed programming and architectural services for a 75,000 s.f. renovation and 87,000 s.f. addition. The existing building was constructed in 1913 with a 1951 west wing addition and eligible for listing on the National Register of Historic Places. The project is currently in the construction phase.

For the City of Fitchburg, we are currently in construction of the $2.3M Community Center Expansion, programming and full architectural services provided by Dorschner|Associates, Inc. The project included significant public input and financially responsible design though our programming study findings of the best use of renovation balanced with new construction. Paul Woodard is the project manager for the City of Fitchburg. Dawn O’Kroley is project designer and project manager.

For Dane County, we completed Space Studies and Master Plans for the National Register listed Lakeview Campus and the County owned space in the City‐County Building. We have constructed two phases of the City‐County Building Master Plan, including gathering information from multiple stakeholders for the shared public meeting spaces. The 11,000 s.f. Phase I was completed in 2009 for $895,000, below the $1,186,000 budget. Phase II was 10,000 s.f. including the primary public meeting spaces, completed in 2010 for $608,000 below the original $640,000 budget. We are currently in the design phase for the Room 201 renovation. Rob Nebel is the project manager for the County. Dawn O’Kroley was the project designer and project manager. Please feel free to contact the following references:

Rob Nebel Assistant Public Works Director Dane County Department of Public Works, Highway & Transportation Ph: 608.575.0890 [email protected]

Paul Woodard City of Fitchburg Director of Public Works Ph: 608.270.4261 [email protected]

Al Martin Planner III/Secretary, Urban Design Commission City of Madison Department of Planning & Development, Planning Unit Ph: 608.267.8740 [email protected]

Matt Karnick AVP, Business Development Officer First Business Bank Ph: 608.232.5926 [email protected]

The following contractors and design team members bring skilled experience with historic rehabilitation projects and public projects, an understanding of the project concept and site through the pre‐proposal tours provided by the City, and are great people that are a pleasure to work with:

Bill Muir, General Contractor, Muir Cabinetry and Construction

Bill is the owner of Muir Cabinetry and Construction, providing residential construction services in Dane County for 23 years. MCC specializes in restoration and remodeling of older homes. Our well‐equipped shop allows us to create customized cabinetry and millwork to match historical details and designs.

Two of our projects have won awards from the Madison Trust for Historic Preservation for successful historical renovations. We have worked on several significant homes in Madison, including two on the National Register of Historic Places. We have done extensive interior and exterior work on the Louis Sullivan‐designed Bradley House on North Prospect Street, and are currently performing restoration on the William T. Leitch House on Gorham Street. Please feel free to contact the following references for Bill Muir: Rex Jones Historic Louis Sullivan house restoration work, library 608.250.8585

Jack Holzheuter Complete house gut and remodel, two additions, kitchen, baths 608.767.2280

Liz and Paul Faye Complete first floor remodel, kitchen, bathroom, new sun room 608.273.6044

Kurt Frey, Structural Engineer

Kurt is an associate with Pierce Engineers, Inc. and is responsible for directing and providing the structural engineering services offered. He is responsible for the overall planning, collaboration, coordination, design, and construction administration for structural systems on numerous project types. He excels at optimizing and understanding Architecture / Engineering / Construction systems, designs, processes, and team structures to create optimal and client valued projects. He offers a distinctive acumen and proven ability to develop innovative, cost effective, and constructible solutions to the dynamic design processes of architecture, engineering and construction to meet the challenges of projects.

Related Historic Rehabilitation Work completed by Pierce Engineers, Inc. include the Tobacco Lofts at Findorff Yards, Turner Hall Ballroom, The Wicked Hop, Gullen Tannery, Lo Duca Building (Commission House), Bockl Building and 757 North Water Street in Milwaukee, WI

John Thompson

John will provide all masonry restoration services and is also an architect. He has work extensively with the Wisconsin Historical Society on several historic restoration projects and is well versed in the Secretary of the Interior’s Standards for the Treatment of Historic Properties. His experience includes restoration work for Frank Lloyd Wright and Louis Sullivan designed historic structures. John was referred by Ledell Zellers for his work restoring her Mansion Hill residence at 510 N Carroll Street.

Richard Slayton

Richard’s experience includes over three decades of practicing landscape architecture including over 15 years with Marshall Erdman & Associates/Cogdell Spencer + ERDMAN. His work ranges from master planning, urban design, site design and estimating and serving on the American Society of Landscape Architects Executive Committees for New York and Wisconsin. Richard is currently serving on the Urban Design Commission and well communicates and integrates the desires of the public appropriately into the design solution. His work typically incorporates sustainable practices including stewardship of natural processes and the protection / restoration of native plant communities. 6- Fkst - 1 Business FIRST BUSINESS BANK"

July 1,2011

RE: Dawn O'Kroley 640 East Gorham Street Purchase First Business Bank Reference Letter

To Whom It May Concern:

Please use this letter as a bank reference letter, and financial strength verification, as it relates to Dawn O'Kroley and the proposed purchase of 640 East Gorham Street in Madison, WI. In evaluating the financial strength of Dawn O'Kroley First Business Bank evaluated the following:

PersonolCredltScore & History: Dawn's personal credit score of 791 as of 7/1/11 through Transunion is stellar. When evaluating personal credit scores, anything above 700 is both remarkable and difficult to obtain. A personal credit score of 791 indicates Dawn's impeccable credit history and minimal use of debt. Historically, she has shown the ability to acquire and pay down debt rapidly. Dawn previously had mortgage and vehicle installment loans that were promptly paid on time. It should be noted that all historical installment loans have been paid off in full with no delinquent payments. Historically, no delinquent payments on any loans (both installment and revolving) are listed.

PersonalCash Flow: A Personal Cash Flow indicates an individual's ability to repay their current debt obligations based on their current listed income. When completing a personal cash flow for Dawn, we used her 2009 and 2010 personal tax returns as verification of personal in4me and her personal credit report to verify debt obligations. The end result, and key measurement, is the Debt to lncome Ratio. Two personal cash flows were calculated. One for her current debt obligations, and one with the proposed new debt related to the 640 East Gorham Street purchase included. Dawn's Debt to lncome Ratios for 2009 and 2010 were as follows:

-Year Debt to Income Ratio Debt to Income Ratio W IwIGorham aurchase) 2009 0.00 0.26 2010 0.00 0.29

When evaluating a Debt to lncome Ratio, anything below a 0.40 is considered strong. As a reference, Federal Housing Administration (FHA) requires that a Debt to lncome Ratio of 0.43 be obtained to acqulre home financing. As indicated, Dawn's Debt to lncome Ratio (including the proposed 640 East Gorham purchase) of 0.26 and 0.29 in 2009 and 2010, respectively, are well below the previously mentioned guidelines.

Based on the Personal Credit Score and Personal Cash Flow evaluation, Dawn is considered to be in a position of financial strength. For reference I have attached the First Business Bank Proposed Summary of Terms.

If you would require any additional information, please do not hesitate to contact me directly.

First Business Bank 608-232-5926

First Business Bank. www.fbbrnadison.com 401 Charniany Drive (53719). PO. Box 44961. Madison, WI 537444961. 608-238-8008. Fax 608-232-5905 Fdid

COSTS AND FINANCIAL PLAN

PROFORMA

ESTIMATE OF CONSTRUCTION COST AND WORK BY OWNER

LETTER OF COMMITMENT FROM MUIR CARPENTRY AND CONSTRUCTION

CONTRACTOR PROPOSALS INCLUDING DETAILED DESCRIPTION OF WORK

APPRAISAL

SPECIAL CONDITIONS

top: University of Wisconsin‐Madison School of Human Ecology Addition and Renovation bottom left: City of Madison Brittingham Boathouse bottom right: Dr. Wesley L. Scott Senior Community Living COSTS AND FINANCIAL PLAN

The team is committed to a financially responsible proposal for the construction and ongoing care and maintenance of the property.

Rental rates and rental market have been discussed with comparable properties including McBride Point and the Lincoln School Apartments. This project concept supports the goals of New Urbanism and is ECONOMICALLY RESPONSIBLE based on the attached proforma developed in part through attendance at the Congress for New Urbanism, CNU 19, session titled Challenging Development Math for Small Urban Infill Projects.

Understanding the likely response to this RFP for single family use, the following cost proposal is based on property value less improvement costs that would apply to any use of the structure for a rehabilitation meeting the Secretary of the Interior’s Standards for the Treatment of Historic Properties. No improvement costs related specifically related to creating the second unit were deducted from the property value to arrive at the purchase price. The specific costs for the second unit would be offset by the value of the tax credits. Should for any reason tax credits not be available, First Business Bank has qualified the purchaser for the entire project cost as categorized under miscellaneous expense. An industry standard 10% contingency is indicated in the construction cost should unforeseen expenses arise while undergoing a renovation. In addition, the proposer is self performing all finish work, general labor for the window restoration and providing design services. The value of these efforts is indicated as Added Value in the following cost estimate and proforma based on the contractor estimated cost for the work and industry standard design fees.

The proposer is willing to negotiate the terms of the 99 year ground lease for the property that the structure sits upon including outdoor living space additions and access easements. The proposer requests a transferrable ground lease allowing for the sale of the structure. The proposer requests the right to rebuild a structure of a comparable size and use should the structure be damaged beyond 50%. Payment terms of the lease to commence upon substantial completion with consideration for recapture of investment during the terms of the estimated 20 year debt service. Re‐evaluation terms are negotiable. The proposer is willing to negotiate the purchase price, ground lease rates and estimated add to the tax assessment roll indicated in the proforma.

Proforma (NOI and Cap Rate Analysis) 640 E Gorham Street ‐James Madison Park ‐ 2 unit residential ‐ Madison, Wisconsin prepared by D. O'Kroley Project Costs 1690 SF livable space Property Assessment Property Cost 70000 Acquisition Fees and Permit Fees 5000 Construction Costs 125000 Added Value: Work by Owner 60000 Added Value: Tax Credit ReInvestment 20000

Project Costs 200000 Project Costs including Added Value 280000 Net Operating Income Revenue Assumptions: SF monthly rent annual rent

1 bdrm unit (Owner‐occupied) 650 1000 12000 (future expansion to 1100SF) 3 bdrm unit 1040 1500 18000 Building SF 1690 2500 30000 Annual Rent 30000 Gross Potential Income GPI 3% vacancy rate 900

29100 Gross Operating Income GOI Annual Operating Expenses Property management 2.5 % 750 (assumed as % of rents) Accounting 650 Legal 500 Insurance 1000 Property tax/land lease 0.022 mil rate 6160 Add to the tax assessment roll Project Cost including Added Value Maintenance and supplies 1200 Utilities, water 650 (Madison Water Utility Estimate) Utilities, gas and electric 2400 (MG&E current utilites) subtotal 13310 13310 15790 Net Operating Income NOI 200000 Project Cost 7.90% Cap Rate NOI/Project Cost

Cash Flow Acquisition Cost/Project Cost 200000 Added Value: Work by Owner (60000) Added Value: Reinvestment of Historic Restoration Tax Credits (20000) Down Payment 20% 40000 Assumes 20 year amoritization 160000

Monthly payment P&I (5.75% 5 yr fixed rate) (1100) Annual NOI 15790 Annual Debt Service (13,200)

Annual Cash Flow above debt service and operating expenses: 2,590 6.48% pre‐tax return on equity Debt Service Coverage Ratio: 1.20 NOI/annual debt service Estimate of Construction Cost and Work By Owner 640 E Gorham Street prepared by D. O'Kroley Work included Added investment In Project Cost Work by Owner includes abatement and design services General Construction and Site Work Masonry, soffit and fascia repair 12000 Window Complete Restoration, storm replacement 7000 7000 Exterior doors to Outdoor Living Spaces 9200 1800 Replace/Restore entry doors 850 1650 Outdoor Living Space additions 11000 4000 includes recycling/waste container enclosure and bicycle storage Site improvements, landscape, install Landmark markers 5000 10000 stormwater management Plaster removal/repair to accommodate 3500 knob and tube wiring removal Floor sanding and refinishing 2000 2900 Ground Floor Kitchen 8400 3200 First Floor Bath 4250 3650 Painting 4500 Insulate joist pockets, seal voids 500 Chimney Repair/Fireplace Inspection 2000 Water Softener/Laundry 1800 2600 Subtotal 67500 General Conditions 10 % 6750 Subtotal General Construction and Site Work 74250 41300

HVAC Replace existing boiler with High Efficiency Boiler 7850 Replace heat delivery system and pppipin g 9300 Add zoning to heat delivery system 2700 Subtotal HVAC 19850

Electrical Replace knob and tube, receptacles Ground Floor 4730 Replace knob and tube, receptacles First Floor 6480 Replace knob and tube, receptacles Second Floor 1740 Replace knob and tube, receptacles Basement, exterior 830 Smoke and Carbon Monoxide detectors 930 Ground Floor Kitchen 1180 Laundry 400 Relocate electrical service underground 1280 MG&E Estimated Fee for underground electrical 2200 Subtotal Electrical 19770 Subtotal Construction Cost 113870

1 Estimate of Construction Cost and Work By Owner 640 E Gorham Street prepared by D. O'Kroley Work included Added investment In Project Cost Work by Owner includes abatement and design services Subtotal Construction Cost 113870 Contingency: 10% 11387 Total Construction Cost 125257

Added Investment: Work by Owner 41300

Added Investment by Owner: Design Services (LA, Arch, Struct) 11 % 12526

Added Investment Reinvestment of Tax Credits, Second living unit Interior walls and crown molding 3100 4000 First Floor Kitchen 8400 3300 Ground Floor Bath 6600 4650 Entry electrical 420 Ground Floor Bath electrical 540 First Floor Kitchen elec trical 1560 Added Investment Reinvestment of Tax Credits, Second living unit 20620

Added Investment: Work by Owner, Second living unit 7950

Total Added Investment by Owner 61776

Notes: Future care and maintenance costs by Owner

Future lower level outdoor living, living space and bath costs by Owner

Estimates are based on project concept drawings and site visits by the following qualified contractors: Muir Cabinetry and Construction, general construction John Thompson, masonry restoration Zweifel Electric Cardinal Heating, Air Conditioning & Solar Energy For additional information please refer to detailed breakdowns enclosed.

2 Muir Cabinetry and Construction Bill Muir, Owner Mail: 7413 Cedar Stone Drive Sauk City, WI 53583 Telephone: 608-643-0608 Fax: 608-643-0608

Dawn O’Kroley Dorschner Associates, Inc. 849 E. Washington Ave, Suite 112 Madison, WI 53703 June 30, 2011

Dear Dawn:

I am writing to let you know how excited we are about your proposal to renovate the house at 640 E. Gorham Street in Madison. We want you and the selection committee responsible for reviewing the proposal to know that, should your proposal be approved, we are enthusiastically committed to working with you on all the renovations outlined in our bid to you. We understand that the selection process will take several months, and that the project would not start until the spring of 2012. Please let me know if there is any other information we can provide.

Best of luck working your way through the approval process. We look forward to the chance to work with you on this wonderful property.

Take care,

Bill Muir Muir Cabinetry and Construction

Bill Muir 7413 Cedar Stone Drive Sauk City, Wisconsin 53583 Phone/fax: 608-643-0608

PROPOSAL

Client: Dawn O’Kroley Project: 640 E. Gorham Street renovations Address: 640 E. Gorham Street Madison, WI Date: 6/21/11 Phone:

Description Amount ($)

The following is a preliminary proposal for renovations to 640 E. Gorham Street. This is a preliminary proposal pending final specifications and drawings. In general we have tried to match materials and workmanship to the quality of the original house, matching cabinetry and trim styles, using historically appropriate tile and fixtures, etc.. We have not included electrical or HVAC costs.

1) Windows: Includes complete restoration of all existing double hung and casement windows, jambs and sill (except the three sets of windows that will be replaced by new doors). The sashes will be removed from their openings, re- glazed as needed, scraped, sanded, primed and painted inside and out. In a few cases the stiles and rails on the sashes will need to be repaired or replaced. The jambs and sills will also be scraped, sanded, recaulked as needed, primed and painted. Any deterioration or checking will be restored with the Abatron epoxy restoration system. As with all the work, lead removal protocols will be followed. The sashes will be re-installed and supplemental weather stripping will be added to the top and bottoms of the double hung sashes, and at the stops on the casement windows. The existing storm windows on the double hungs will be removed and replaced with historically appropriate storm/screen combination windows. We recommend Marvin wood framed storm windows that can be painted. The crank mechanisms on the casements will be restored to operating condition, or, in a few cases, replaced with matching hardware. All of this work is very tedious, but the existing windows are in very bad shape. By restoring rather than replacing the windows we can maintain the historic character of the existing windows. With the added weather stripping, reglazing, caulking and new storm windows we can approach the U-value of new windows at a fraction of the cost. Much of this work is work that Dawn could help with to help reduce the cost. Materials and supplies: 850.00 15 double hung storm windows, installed 2,800.00 Restoration labor: 230 hrs. @ $45/hr. 10,350.00 Total 14,000.00 14,000.00 Bill Muir 7413 Cedar Stone Drive Sauk City, Wisconsin 53583 Phone/fax: 608-643-0608

PROPOSAL

2.Exterior door: Includes installing one double wide French door and one triple wide French door on the first floor in the current casement window openings on the back of the house. Also includes installing a single French door on the second floor, east side, in place of one existing double hung window. We have included Marvin swinging French doors with 15 divided lites per door (true “SDL” divided lites, not snap- in grills). These will be white aluminum clad on the exterior, painted wood on the interior with screens. This will require reframing the openings, along with masonry work on the exterior to extend the existing window openings down to floor level. New interior and exterior trim will be milled, installed and painted to match the existing original trim. The door sashes will be removed from the frames and all wood surfaces will be primed and painted two coats. Some plaster repairs will be needed as well. Any exposed framing openings will be insulated. We are suggesting these very high quality Marvin doors because of their historic compatibility, and because high quality doors are needed to withstand the wind off the lake. Cost summary for doors: Doors: (allowance pending final details) 6,200.00 Materials and supplies: 900.00 Carpentry labor: 84 hrs. @ $50/hr. 4,200.00 Painting labor (Dawn??): 40 hrs. @ $45 1,800.00 Masonry allowance: 2,400.00 Total 15,500.0 15,500.00

3. Interior wall relocation: Includes removing walls leading to the two new kitchens, framing in walls for the first floor bathroom, bedroom, closing off doorways in the front entry, creating opening from back entry to hallway. Also includes salvaging and re-installing existing crown moldings on the first floor. May require a small amount of custom milled crown to supplement existing. Includes hanging and taping drywall in these altered areas. Includes providing two new interior doors and knobs to match the existing doors, installing and casing the new doors to match, and installing and patching in baseboards. Materials and supplies; 700.00 Two matching doors, pre-hung, with hardware:: 900.00 Carpentry labor: 110 hrs. @ $50 5,500.00 7,100.00 7,100.00

Bill Muir 7413 Cedar Stone Drive Sauk City, Wisconsin 53583 Phone/fax: 608-643-0608

PROPOSAL

4. Plaster removal and repairs to accommodate knob and tube wiring removal: A portion of the plaster on the ceilings and an occasional section on the walls may need to be removed to provide access for the electrician. We are including an allowance for patching and replacing plaster as needed. In some cases the existing ceiling plaster may already be in poor shape. Once the electrical work is done it may be best to hang and tape new drywall on some ceilings. This may require removing and re-installing the top element of the crown moldings. It is hard to know exactly how much of this work will be required. We are including a $3,000 allowance for drywalling and plaster repairs throughout the house, both as a result of electrical access and general repairs. 3,500.00 5.Floor sanding: Some small floor repairs will be needed on both floors where walls are to be removed. Extra flooring can be harvested from under the new location for the kitchen cabinets. In addition, the vinyl flooring in the existing kitchen and back entry will be removed and the flooring underneath examined. We have included the cost to install new hardwood in this area. May or may not be needed. All the hardwood floors will then be sanded and finished. Kitchen and rear entry flooring removal and installation: 1,800.00 Misc. floor patching allowance: 800.00 Sanding and refinishing: 2,300.00 Total 4,900.00 4,900.00 6. Kitchens: We have included the cost for cabinetry, countertops, plumbing and plumbing fixtures, appliances, range hood and venting for two kitchens. We have included custom painted cabinets to match the remnant of the original cabinets with inset flat panel doors, crown moldings, etc... We have also included stone or solid surface countertops. We are assuming some detailed customization of design and cabinet construction to maximize the usefulness of the limited cabinet space. Obviously there is a huge cost range for this type of work. Below are the allowances we have included to create historically appropriate, efficient kitchens. Cost summary for two kitchens: Cabinetry, including installation, painting, crown, trim: 11,500.00 Countertops: 7,000.00 Plumber 2,400.00 Sinks and faucets 1,000.00 Appliances, installed 4,000.00 Range hoods and venting 1,100.00 Coordination, errands, supervision, misc. carpentry: 2,600.00 Painting of walls, ceilings and trim: 1,500.00 Total 31,000.00 31,000.00 Bill Muir 7413 Cedar Stone Drive Sauk City, Wisconsin 53583 Phone/fax: 608-643-0608

PROPOSAL

7. First floor bathroom: Includes constructing a new bathroom on the first floor in a portion of the existing kitchen space with a tub/shower, pedestal sink and toilet. We have included a 1” hexagonal porcelain tile floor set on ½” cement board and white subway tile on the shower walls and half way up the room walls to match the original second floor bathroom. The exterior walls will be gutted to the studs, insulated with 3” rigid foam and a 6-mil vapor barrier, and then drywalled and painted. Includes an exhaust fan, discretely vented through the brick on the west side of the house. Cost summary for first floor bathroom: Carpentry materials and supplies: 850.00 Carpentry labor: 54 hrs. 2,700.00 Tile allowance, including materials and labor: 2,400.00 Plumbing costs: 2,500.00 Plumbing fixture allowance: 1,800.00 Exhaust fan, vented: 450.00 Medicine cabinet and bath accessories allowance: 800.00 Supervision and contracting, errands, clean up: 900.00 Painting of walls, ceiling and trim: 850.00 Total first floor bathroom: 13,250.00 13,250.00

8. Second floor bathroom: Includes restoring existing floor and wall tiles and grout, removing existing tub and tiled tub surround, installing new cast iron tub, retiling tub surround in similar tiles installed over ½” cement board. We have included creating an arched opening into the tub area to provide a transition between the original wall tiles and the new tile in the shower. The exterior wall of the tub surround will be insulated with 3” of rigid foam. The existing toilet and sink will be replaced and an exhaust fan will be installed and vented. The walls, ceiling and trim will be painted. Cost summary for second floor bathroom: Carpentry materials and supplies: 500.00 Carpentry labor: 46 hrs. @ $50 2,300.00 Tile allowance, including materials and labor: 1,600.00 Plumber: 1,500.00 Plumbing fixture allowance: 1,800.00 Exhaust fan, vented: 450.00 Painting: 850.00 Supervision, contracting, errands, clean up: 900.00 Total cost for second floor bathroom: 9,900.00 9,900.00

Bill Muir 7413 Cedar Stone Drive Sauk City, Wisconsin 53583 Phone/fax: 608-643-0608

PROPOSAL

9. Interior painting: This includes interior painting of areas not affected by any of the above projects. This could vary widely, depending on the extent of prep work and the extent of repainting needed. This is an allowance for materials and labor, pending final specifications. Interior painting allowance: 4,500.00 4,500.00

10. Front storm door: Includes replacing the front door with a historically appropriate painted wood storm/screen door, including hardware. Door and hardware allowance: 450.00 Installation and painting: 400.00 850.00 850.00

11. Rear balconies: Includes constructing an 8’ deep balcony/deck off the back of the first floor covering the entire length of the back of the house. Historically appropriate painted cedar newel posts, rails and balusters will be installed. The frame will be constructed out of treated lumber, and the deck will be supported by treated 6x6 posts, set on concrete piers that extend 4’ below grade. Bracketing and other details will be installed below the deck to create visual and historically appropriate details. A similar, smaller balcony will be installed off the second floor on the east side of the building, perhaps extending slightly beyond the back of the house to provide lake views. This balcony will be supported by structural wooden brackets rather than support posts extending to the ground. The detailing of these balconies is pending, so we have included an allowance until the final specifications are determined. Allowance for first and second floor balconies: 15,000.00 15,000.00

12. General conditions: This includes project expenses that don’t fit into any one category, including dumpsters, recycling costs, daily clean up, design and planning time, misc. repairs, punch list items, etc.. On a project like this, these expenses can range from 7%-10% of the project cost. Until the scope of the project is refined, we are including an $8,000.00 allowance for these expenses. 8,000.00

Total

Bill Muir 7413 Cedar Stone Drive Sauk City, Wisconsin 53583 Phone/fax: 608-643-0608

PROPOSAL Terms

Any balance outstanding 30 days beyond final completion will be charged 1.5% interest per month (18% per year).

All work is guaranteed to be as specified. All work to be completed in workmanlike manner according to standard practices. Any alteration or deviation from the above specifications involving extra costs will be executed only upon written orders, and will become an extra charge over and above the estimate. All agreements contingent on strikes, accidents or delays beyond our control. Owner will carry fire, tornado and other necessary insurance. Our workers are fully covered by workman’s compensation insurance.

As required by the Wisconsin construction lien law, builder hereby notifies owner that persons or companies furnishing labor or materials for the construction on owner’s land may have lien rights on owner’s land and buildings if not paid. Those entitled lien rights, in addition to the undersigned builder, are those who contract directly with the owner or who give the owner notice within 60 days after they first furnish labor or materials for the construction. Accordingly, owner probably will receive notices from those who furnish labor or materials for the construction and should give a copy of each notice received to his mortgage lender, if any. Builder agrees to cooperate with the owner and his lender, if any, to see that all potential lien claimants are duly paid.

Approved by: Client Signature Date

Contractor Signature Date

Upon approval, please sign and return one copy, keep one copy for your files.

June 6, 2011

Dawn O’Kroley [email protected]

Dawn, Here are a few budget prices / options for you potential project: OPTIONS 1 REPLACE EXISTING BOILER SYSTEM W/ SIMILAR CAST IRON GRAVITY VENT BOILER $5275.00

2 REPLACE EXISTING BOILER SYSTEM W/ HIGH EFFICIENCY BOILER $7850.00

3 REPLACE HEAT DELIVERY SYSTEM AND PIPING $9300.00

4 ADD ZONING TO HEAT DELIVERY SYSTEM $2700.00

Did not see an existing water softener in the basement. Didnt include any options for A/C at all, or any potential bathroom exhaust fans, or kitchen range exhaust. The current state of the chimney/flue is not good. Before a cast iron boiler replacement could occur, the chimney issues would need to be addressed by a licensed chimney professional. Option pricing is to be used for budget puropses, as the project really doesn’t yet have many specifics detailed. If I can answer any questions at all, let me know. Hope this is what you were looking for Dawn; If you have any further needs, I'd be happy to help out! Thanks, Dave Dave Perretz ‐Commercial Division Project Manager Cardinal Heating,Air Conditioning&Solar Energy 222 Linnerud Dr. Sun Prairie, WI 53590 (608)209‐6923 Direct (608)837‐9367 Office (608)837‐6469 Fax [email protected]

PROPOSAL Zweifel Electric, LLC Dwight A. Zweifel, Certified Master Electrician 3567 Hwy 78, N., Mt. Horeb, WI 53572 (608) 437-4291 [email protected]

Proposal Submitted To: Date: 3 June 2011

Dawn OKroley [email protected]

Option #1- 640 East Gorham Street, Madison. The house remains a single family home. Work as follows: Item #1- 1st floor- Remove and re-wire all switches and ceiling lights, remove all knob and tube wiring, and provide new devices and covers to match. Re-install all existing lights if the wiring is good, or install new lights provided by others. Remove any wall or ceiling for accessibility, and patching to be done by others. All existing outlets shall remain, and install new devices and covers to match. Install new outlets and wiring to meet minimum housing codes. $4730.00 Item #2- 2nd floor- Remove and re-wire all switches, outlets, and lights, remove all knob and tube wiring, and provide and install new devices and covers to match. Re-install all existing lights if the wiring is good, or install new lights provided by others. Remove any wall or ceiling for accessibility, and patching to be done by others. Install new outlets and wiring to meet minimum housing codes. $6480.00 Item #3- 3rd floor- Remove and re-wire all switches, outlets, and lights, remove all knob and tube wiring, and provide and install new devices and covers to match. Re-install all existing lights if the wiring is good, or install new lights provided by others. Remove any wall or ceiling for accessibility, and patching to be done by others. $1740.00 Item #4- Basement- Provide and install a dryer and washer circuit and outlets. Provide and install outdoor lighting and switching in the rear of the house. Install the new lights provided by others. Re-install wiring in the basement in a professional manner, and to current codes. $830.00 Item #5- Provide and install smoke detectors and carbon monoxide/smoke detectors per current codes. $930.00

Base bid-$14710.00 Permit fee-$130.00 Bid total option #1-$14840.00

Option #2- 640 East Gorham Street, Madison. The house becomes an owner occupied 2 flat, with single metering and a gas stove and furnace for appliances. The items #1 through #4 in option #1 apply, with additional costs and options for laundry hookups, new kitchens, new bathrooms, new entrances and exits, and a new electrical panel for the 2nd floor only. Bid total for option #1-$14840.00 Item #1- Provide and install wiring, circuits, devices, and an exhaust fan unit for the new bathroom installation for the 1st floor. No venting included. $540.00 Item #2- Remove the exiting kitchen in the 1st floor southwest corner, and re-install wiring, circuits, and devices in the northeast corner of the house. Install all lights provided by others. $1180.00 Item #3- Provide and install new switching and lighting for the 2nd entrance into the 1st floor living room area. Install all lights provided by others. $420.00 Item #4- Provide and install new kitchen wiring, circuits, and devices for the 2nd floor kitchen. Install all lights provided by others. $1560.00 Item #5- Provide and install a dryer and washer circuit and outlets in the basement for the 2nd floor. Provide and install new switching and lighting for the 2nd entrance into the 2nd floor entry area . $750.00 Item #6- Provide and install a 2nd 100 amp weatherproof disconnect outside, to energize a 2nd electrical panel, located in the 3rd floor. The new electrical panel will energize the 2nd and 3rd floor circuits, and provide a local control for the occupant. $1280.00 Item #7- Provide and install a 200 amp underground meter pedestal, to energize the existing electrical panel, and the electrical panel in the 3rd floor. The price for MG&E is an estimate based on the latest figures available, and may be subject to change. MG&E cost- $2200.00 Electrical cost- $1730.00 Permit fee- $30.00 Total item #7- $3960.00

Bid total option #2-$24530.00

We hereby propose to furnish labor and materials, complete in accordance with the above specifications, for the sum of: DEPENDS ON THE OPTIONS TAKEN. With payment to be made as follows: 40% TO START THE PROJECT, 40% UPON COMPLETION OF THE ROUGH ELECTRICAL, AND THE BALANCE UPON COMPLETION OF THE PROJECT. Prices will be honored within 30 days from date of proposal. No patching, painting, or repair included. All material is guaranteed to be as specified. All work is to be completed in a workmanlike manner according to standard practices. Any alteration or deviation from above specifications involving extra costs will be executed only upon written orders and will become an extra charge over and above this proposed price. All agreements are contingent upon strikes, accidents or delays beyond our control. IT IS OUR INTENT TO FILE A LIEN AGAINST OVERDUE INVOICES, CHARGE 18% ANNUAL INTEREST ON THE UNPAID BALANCE, AND CHARGE ALL ATTORNEY FEES USED IN THE COLLECTION OF THE UNPAID BALANCE. Owner to carry fire, tornado, and other necessary insurance. Zweifel Electric, LLC, is licensed, bonded, and insured throughout the State of Wisconsin.

______Authorized Signature

ACCEPTANCE OF PROPOSAL (please return one signed copy) The above prices, specifications, and conditions are satisfactory and are hereby accepted. Zweifel Electric, LLC is authorized to do the work as specified. Payment will be made as outlined above.

Accepted: (signature) ______Date: ______

SPECIAL CONDITIONS

This a unique opportunity and I am committed to dedicate my abilities to CREATE A PLACE that respects the natural and historic context, while creatively infusing thoughtful design to improve quality of life, connection with the site and public access.

The approach included in this proposal for the purchase of the property located at 640 E GORHAM STREET could similarly be applied to include the purchase of 646 E GORHAM STREET. The proposer is also willing to discuss with the City the purchase of 646 E Gorham Street. A more efficient site design for the two properties would improve views from E Gorham Street to Lake Mendota by revising the parking layout, extending the treatment of the landscape, and locating all electrical underground.

The proposed schedule, costs and ground lease terms are negotiable to ensure this project is the long‐ term BEST USE OF SITE and the most significant increase in the tax assessment roll.

Thank you for your consideration of our team. We appreciate the opportunity to discuss this proposal with you and provide any additional information requested.