The North End Phase II, 55-unit Apartment Building

Mandel Group will be moving forward with the second phase of The North End development project in February.  Financing for the project was finalized as WHEDA completed the sale of $54.6 million of tax-exempt Midwest Disaster Area bonds.  These funds will go to provide funding for The North End Phase II, as well as funding the “LightHorse | 4041″ mixed-use development in Shorewood.  Additionally, Mandel Group directly placed $7.75 million in tax-exempt bonds to complete the financing for the project.  “This was one of the more involved financings we’ve completed thus far, indicative of the challenges with capital formation in the real estate space” commented David A. Pavela, Chief Financial Officer for Mandel Group, Inc.

The North End Phase II, 100-unit Apartment Building

This phase will add 155 apartments, 20% of which will be affordable units per the WHEDA financing agreement, new retail space, and numerous public infrastructure improvements.  Richard W. Lincoln, senior vice president of Mandel Group, noted that “Significant investment by both the public sector and our development partnerships will add new streets, an extensive riverwalk and a new public meeting and entertainment square” to the North End development.

The North End Phase II

At yesterday’s meeting of the Zoning, Neighborhoods and Development Committee meeting Mandel Group’s efforts to acquire financing for the next phase of The North End were recommended for approval. The $4.6 million city loan was approved as part of the second amendment to the Park East TID No 48 has a term of 18 years and a 5.5% fixed interest rate. The second phase will include two buildings, a 55-unit building and a 100-unit building, both one-story taller than the previous buildings. The 55-unit apartment building will complete the block face along Pleasant St. and frame a new public square. The 100-unit building will be constructed along a new street that will run along the Milwaukee River. As the project is being partially funded by WHEDA with $26.18 million (was originally $24 million) in variable rate tax-exempt bonds 80% of the apartments will be offered at market rates while 20% will be reserved as affordable housing units. Additionally, $2.2 million of previously approved TIF funds will be used during this phase to construct the dockwall, the riverwalk, a public square, and a new street. This file will now go before the full Common Council for approval

Tom Daykin has an article on the approval as well, City Loan for North End Phase II Recommended for Approval at committee.

100-unit Apartment Building

The Wisconsin Housing and Economic Development Authority (WHEDA) announced today that Mandel Group Inc. will receive $24.1 million in financing to support the development of the second phase of The North End in Milwaukee’s Park East Corridor.   This phase will include two five-story apartment buildings with a total of 155 units, 31 of which will be dedicated workforce housing.

The building along the Milwaukee River will have 100 units, while the Pleasant St. building will include 55 units and approximately 2,300 square feet of retail fronting the corner plaza. Individual apartments will include features similar to those found in the first phase of The North End, such as patios, in unit washer and dryer, green space, a media room, and underground parking.  Additionally, the project will finish off the first block of The North End development, by completing Milwaukee St., building a new street along the riverfront, and the construction of a new Riverwalk section.

Mandel Group is continuing to work with the City of Milwaukee to obtain an $8 million loan to complete the financing of the $38 million project. If able to obtain the appropriate approvals the plan is for a March 2011 ground breaking, and construction would take from 14 to 16 months.

Bookends North (Proposed)

Odds of New Land Enterprises project getting off the ground in the next twelve months are slim to none. Probably worse with the recent announcement that New Land satisfied a potential foreclosure by surrendering their Transera/Goll Mansion property.

Brewer’s Hill Lofts (Proposed)

Commonwealth Development Corporation received $1,313,568 in WHEDA tax credits to help finance the proposed 45-unit Brewer’s Hill Lofts on the corner of N. Holton Street and E. Brown Street. No other public details have emerged on this project yet.

Mercy Housing Lakefront – North Avenue (Proposed)

Perhaps the most active of any proposed project in the Milwaukee-area. After a number of revisions by Korb Tredo Architects and Mercy Housing Lakefront, this $8.5 million, 5-story, 54 unit project finally appears ready to seek full Common Council approval.

Mercy Housing Lakefront's proposal

North End Phase Two (Proposed)

The speed at which this $39 million second phase leaves the drawing board and breaks ground appears largely in the hands of the city at this point. Despite the eagerness the city had to finance The Moderne and the Bookends North proposals, the city to-date has not yet pushed through any type of financing the second building at The North End. The project would include two six-story buildings at 1551 N. Water Street. The Mandel Group had hoped to break ground in the spring of 2011.

Park East Commons (Proposed)

This project seems unlikely to move forward in the next twelve months, and may be dead all together. CommonBond Communities had agreed to buy a portion of the Park East block (bordered by Milwaukee, Jefferson, Lyon and Ogden) that RSC & Associates bought from Milwaukee County. CommonBond’s proposal was for 87 apartments, 61 underground parking spaces, and street-level retail (11,000 square-feet, owned by RSC). CommonBond was placed “on hold” by WHEDA for the $1,672,644 in federal affordable housing tax credits for which they applied. Prior to the CommonBond deal, RSC was approved for a $30 million bond issuance by RACM in January. To-date RSC has been unable to develop anything on the land.

The Moderne (Proposed)

The Moderne has had more false starts in the past year than the Chicago Bears. Initially, with financing from the city they hoped to break ground in November of 2009. That didn’t happen, so it was on to a planned December 2009 ground-breaking after the city awarded the proposal financing in early November. December didn’t happen, which led to Developer Rick Barrett believing February would see shovels in the ground, but due to a delay at HUD that didn’t happen. Next up was a September or October groundbreaking, which again didn’t happen because of HUD even though they awarded the project final loan guarantee approval in late August. Technically it could still happen in November, but now it looks like The Moderne will finally break ground in December of 2010 with HUD expected to finally close on the deal.

Nighttime rendering of The Moderne

Wangard Properties (Proposed)

Wangard’s proposal to develop an apartment building next to the HighBridge Condominiums on North Water Street received zoning approval in January of 2010. Wangard, as of August, was seeking a loan guarantee from HUD for the proposed 68-unit building, and had hoped to break ground in October 2010. Similar to the The Moderne, this project is still waiting on HUD to move forward.

Beerline B Apartments (Under Construction)

General Capital Group broke ground on the Beerline B Apartments in November of 2010. The project is financed in part by $2,345,310 in WHEDA tax credits. The project includes 140 units, and will occupy the long vacant corner of Commerce Street and Pleasant Street in Milwaukee’s Beerline neighborhood.

Beeerline B Apartments Rendering

Jackson Square Apartments (Under Construction)

Nearing the completion of construction in the Third Ward is Robert Joseph’s 81-unit Jackson Square Apartments.  When finished the project will feature 100+ underground parking stalls, and 9,000 square feet of retail space.  Rents will range from $800 to $1,600 with units split between one and two bedrooms.

Jackson Square Apartments Construction

National Lofts (Under Construction)

Dixon Development (Tim Dixon, Iron Horse hotel, Kramer Lofts) has begun demolition of the former Barry Trucking facility on the northeast corner of National Avenue and 1st Street. This development will be the first on the site, and will be placed at the back of the lot. It is being financed through $1.5 million in federal affordable housing tax credits.

South Water Works – Building Three (Under Construction)

Lighthouse Development is in the process of building an additional 52-unit apartment building at the South Water Works development. Construction is expected to be completed by March of 2011. Average unit size in the new development will be smaller than the neighboring Bridgeview apartments (800 vs 940 square-feet).

Corcoran Lofts (Open)

Mandel completed the Corcoran Lofts in the spring of 2010. The building is connected to the existing Gaslight Lofts, and includes 76 apartments and 3,400 square feet of retail space.

Corcoran Lofts Construction

Hide House Lofts (Open)

The Hide House Lofts were completed in November of 2010. The Bay View development features sixty units on four floors. General Capital Group and Joseph Property Development built the apartments after a contentious battle with area residents in 2009, which largely centered around the building’s use of WHEDA tax credits to finance part of its construction. The Hide House Lofts replaced the portion of the Greenebaum tannery complex built in the 1940′s, the portion built in 1898 still stands.

Hide House Lofts Construction

Latitude Apartments (Open)

The Latitude Apartments were completed in August 2010. Originally a project of New Land Enterprises, the Latitude Apartments won full zoning approval from the Milwaukee Common Council in December 2008 and was sold to Dermond Property Investments for $2.1 million in January 2009.  The project is located at the intersection of Kenilworth Ave. and Farwell Ave. just across from the Kenilworth Square Apartments.  The $13 million project features 90 units, and 7,500 square feet of street-level retail.  The units are broken down into 71 one-bedroom units and 19 studios.  Units range in size from 650 to 1,000 square feet.  The project includes 90 underground parking spaces, with 13 reserved for retail tenants.

Latitude Apartments

First, up of course is The Moderne, which borders the Park East and is scheduled to break ground in February.  This $56 million, 30-story high-rise apartment project received city financing in late 2009 and when built out could serve as a catalyst to further development in the corridor.

Another significant project that appears to be advancing is the first phase of RSC & Associates’ Park East Square proposal.  This first phase would include a 120-unit apartment building with 4,000 square feet of retail space.  Recently it received assistance from the Redevelopment Authority of Milwaukee (RACM) which would issue $25 million in revenue bonds to help the project move forward with the intent of breaking ground in late spring.  Although, RSC & Associates have failed to meet ground breaking goals in the past with RACM’s assistance it appears this project is likely to move forward.

At a Zoning, Neighborhoods & Development committee meeting in October, 2009 Department of City Development (DCD) Commissioner Rocky Marcoux stated that Mandel Group would be bringing forward the second phase of the North End shortly.  As of yet this hasn’t occurred, but with the success of the first phase, combined with Mandel Group finishing up two major projects, Corcoran Lofts and Cambridge Commons, elsewhere in the city this year, they might look to continue their development within the Park East.

The $76 million Eco-Square at Park East proposal by Fair Market Development would build out 400 residential units and 10,000 square feet of retail space in Block 22 of the Park East if it were to move forward this year.  Unfortunately, as there hasn’t been any recent news regarding this project it seems like the least likely of the projects to move forward in 2010.

Finally, Rainier Properties II LLC’s office and movie theater proposal looks promising as Marcus Corp., has formally committed to the $100 million project.   The potential time-line for this project probably will push it beyond 2010, as various approvals, financing, and a likely city funded TIF will need to be worked out prior to ground breaking.  If it is able to meet those requirements this project could dramatically change downtown Milwaukee for the better.  Because, it is one of the key sites in the Park East corridor, would fulfill the long talked about downtown movie theater need, further extend the Riverwalk, and be a socially diverse meeting place that Milwaukee needs.

Certainly, there will be plenty of land in the corridor to develop post 2010 and only a couple of these projects will actually break ground this year, but with the addition of new density, new entertainment options, and new office space, it might just be that 2010 is remembered as the year of the Park East.

So we should ask if the Park East Freeway spur was worth keeping or is the long-term benefit more worthwhile than the long-term costs.  One of the big concerns regarding the removal of the Park East Freeway spur was that congestion would increase, but the numbers show that traffic delays peaked after the removal and have settled back to 2001 levels, the last full year of regular operation of the freeway spur.  Access to downtown Milwaukee has actually been improved, because the new street level boulevard allows drivers to turn on to more streets than the freeway spur allowed.  Simply, looking at it from a cost point of view, the freeway spur’s repair costs at the time of its removal were estimated at $100 million, clearly this is significantly more expensive to maintain than a street level boulevard.  From a tax base point of view, the freeway limited development of property, not just under it, but near it, and although it has yet to develop, the potential is at least there, and some neighboring properties have added to the tax base.

The big complaint in regards to the Park East is that development has been slow to take hold in the area.  Unfortunately, there is truth to this, but looking at the edges of the Park East corridor it is clear investment is starting to take hold.  Developments such as the North End, the Flatiron, the Aloft, the Brewery, and the soon to break ground Moderne are a direct result of removing the Park East Freeway spur.  These would of been undesirable sites to develop, because of limited access, a perceived disconnect from downtown, and the blighting influence of locating in the shadow of a concrete ramp.  Finally, Milwaukee has already proven it can fill-in underutilized land. The Park East Freeway was supposed to extend to the lakefront and the land was cleared for it, but the freeway never happened and the land sat vacant for years (east of the spur that was built).  That land now contains a long stretch of residential apartments, a Pick ‘n’ Save, and fits in the neighborhood fairly well.  It’s unfortunate that this land was ever cleared, but it shows Milwaukee can reclaim once underutilized land and can do it again.

There is no question that there are a number of factors that have slowed development in the Park East.  The lot sizes that Milwaukee County is attempting to sell are too large, which limits the number of developers able to participate and forces the scale of the development to a point that requires very significant financing.  It’s also possible Milwaukee County’s PERC regulations have limited the number of developers interested in developing within the Park East.  Further, these regulations may have played a role in developers requesting TIF’s from the City of Milwaukee to finance projects, though the existence of a direct relationship isn’t clear.  The problem that has come up more than once is developers having to deal with two levels of government with differing goals.  A clear example of this is RSC & Associates’ Park East Square proposal.  Milwaukee County closed on the land sale, despite RSC & Associates lack of financing, fluctuating plans, and continued attempts to gain City of Milwaukee financing for the project.

The opportunity lost had Milwaukee not removed the Park East Freeway spur was simply too great to miss out on, but it does seem it’s time for Milwaukee County to get out of the way and allow the City of Milwaukee to control the land in order to expedite development.

Wangard Properties (Proposed)

The most recently announced of any of the projects.  Tom Daykin reported yesterday that Wangard Properties intends to build an apartment building next to the Highbridge Condominiums (developed by New Land Enterprises) on N. Water St/E. Kane St.  The proposed building would likely include no more than 88 units.

Latitude Apartments (Under Construction)

Originally a project of New Land Enterprises, the Latitude Apartments won full zoning approval from the Milwaukee Common Council in December 2008 and was sold to Dermond Property Investments for $2.1 million in January 2009.  The project is located at the intersection of Kenilworth Ave and Farwell Ave just across from the Kenilworth Square Apartments.  Construction is in full swing now.  When finished the $13 million project will feature 90 units, and 7,500 square feet of street-level retail.  The units are broken down into 71 one-bedroom units and 19 studios.  Units range in size from 650 to 1,000 square feet.  The project includes 90 underground parking spaces, with 13 reserved for retail tenants.  Direct access to the Oak Leaf Trail is a unique aspect of the project.

Jackson Square Apartments (Under Construction)

Under construction in the Third Ward is Robert Joseph’s 81-unit Jackson Square Apartments.  When finished the project will feature 100+ underground parking stalls, and 9,000 square feet of retail space.  Rents will range from $800 to $1,600 with units split between one and two bedrooms.

Corcoran Lofts (Under Construction)

The Corcoran Lofts are under construction on Corcoran Avenue in the Third Ward and are on pace to open in the spring of 2010.  A Mandel Group development, the six-story development will include 76 units and 3,400 square feet of retail space.  The building will connect to Mandel’s 138-unit Gaslight Lofts, which will allow Corcoran residents to take advantage of Gaslight Lofts amenities such as the fitness center.  It will also allow the operating staff at the Gaslight Lofts to serve the new building. Rents will range from about $900 to $1,500.  The first two floors of the building are largely all parking, with the apartments being confined to the upper four floors. Urban Milwaukee has extensively photographed the development of this project, visible in our Friday Photos feature.

• Official Website

The North End ONE (Open)

ONE, the first building in the “neighborhood by design” development has been a resounding success in terms of apartment occupancy so far.  Having opened in the late spring of this year, the 83-unit Mandel Group development is within a couple units of being completely leased.  On a positive note for Milwaukee, Richard Lincoln of the Mandel Group estimates that 75% of the residents have moved to the building from outside of the city.  Mandel has a letter of intent for 3,000 of the 12,000 square feet of first floor retail space.  The next building built in the North End is likely to feature apartments as opposed to condos as well.  Mandel hopes to break ground on that building in 2010. Urban Milwaukee took a tour of the building while construction was finishing.

• Official Website

Bridgeview (Open)

A former warehouse turned apartment building by Lighthouse Development, the 55-unit Bridgeview is part of the South Water Works development just south of the Third Ward in Walker’s Point.  One and two-bedroom units with prices ranging from $900 to $1,800.  The five-story building that was once home to Pittsburgh Plate Glass (PPG) is 85% leased and over 75% occupied. Urban Milwaukee took a tour of the building when it was under construction.

• Official Website

Blue Ribbon Lofts (Open)

The former Pabst Brewing Keg House is now home to 95 units by way of Gorman and Company Inc.  A big piece of the conversion of the Pabst Brewing Complex into The Brewery.  Targeted towards the creative class, the building features a music studio, artists’ workspaces and galleries, a fully equipped business center and conference rooms, a theater/presentation space and a fitness center.  Of the 95 units, 69 are available under affordable rent tax credits thanks to tax credits from WHEDA to support the project’s development.  The total project cost was $16.2 million.

• Official Website

The green roof on the second floor, although far from finished, seemed impressive and a unique asset to the project.  The entertainment room, available to all residents, provides direct access to the green roof.

The parking garage is pretty well hidden, and isn’t visible from street-level on Water Street, a nice touch.

The sound-proofing between units seems significantly better than Mandel’s East Pointe neighborhood, although comparing the quality of construction between the two is essentially comparing apples to oranges (East Pointe was built in the early 90s before anything else was happening in downtown residential development).  Insulation on interior walls should help (both with heating and noise), as well as the concrete between floors.

The views from each unit offer nice angles on the rest of the city, and most angles will improve

Unit prices are as follows.

• Studios start at $1,040
• One bedrooms start at $1300
• One bedrooms w/ den start at $1275
• Two bedrooms start at $1700
• Two bedrooms w/ den start at $1850
• Three bedrooms start at $2200

As far as retail goes, discussions have taken place with Alterra and other retailers, but no dotted lines have been signed yet.

Photo Gallery

Click on an image once for the image page, and again for a full-sized image.

Speculative industrial buildings being built in what is supposed to be a “high-end” mixed-use development? The developers behind Pabst Farms are looking like they simply wish to make a quick buck with no-thought to the long-term viability of the neighborhood with more buildings surrounded by parking lots.

Logically, pedestrian-friendly, mixed-use neighborhood design is extremely efficient because it requires fewer roads and parking stalls, requires residents to use less gas, leaves more true “green space” (untouched forests and fields, not mowed grass), and allows space to be more rapidly and creatively redeveloped in the wake of a business closing because of its proximity to other businesses and people (it’s easier to open a restaurant on a busy street, etc). It’s good for business and good for residents.

Pabst Farms seems to wish to fight this logic, take what used to be a space of large undeveloped land, claim…

Our philosophy is to build to the land, not on the land, carrying on the spirit of conservation begun by Fred Pabst back in 1906″

… and then build parking-lot-centric developments. To give you an idea of their thinking, examine this photo of their “Commerce Centre.” Judging by the developments in place already, the area has yet to become a commerce center and is simply a distribution center. A distribution center gives you images of 18-wheelers rolling in-and-out at all hours of the day though, and that’s certainly not as attractive as the wealth-generation implied by the word “commerce.”

Now picture three more buildings that will be smaller (in square-footage), but similar to the Roundy’s Distribution Center. Even more attractive, right?

Is this your vision of high-end? Certainly not mine.

That’s the industrial space. How about the commercial development?

Again, clearly designed around the automobile, not conservation.

The Staybridge Suites that will begin construction shortly at Pabst Farms will certainly more closely resemble the Hilton Garden Inn pictured above, than it will the mixed-use, parking-lot-free (uses a hidden garage) Staybridge Suites nearing completion in downtown Milwaukee. Pabst Farms adds a parking lot, downtown Milwaukee builds over one, and hides one inside the building. Not to mention that long-term construction in the Park East area will further diminish the need for parking garages, while building parking lots only encourages more parking lots in the future.

Residential space? Largely the same story.

Again, all this is done under the name of conservation and high-end development.

Interestingly enough, as Pabst Farms positions itself as a new neighborhood on former farm/green space land, a similar “Neighborhood by Design” development is going on in downtown Milwaukee. The Mandel Group is developing The North End on what used to be an abandoned factory in downtown Milwaukee. The Mandel development will include condos, apartments, retail, and office space.

The difference between the two? The Pabst Farms development decreases the amount of green space and encourages driving through natural assets. The North End encourages public, pedestrian access to natural assets and actually increases the amount of green space. Not to mention extending the phenomenally successful Milwaukee Riverwalk yet further north.

Unlike the photos above, that show parking lot and after parking lot, The North End places buildings close together, and makes them multi-level. It also mixes uses within a building, instead of across main traffic arteries.

Thankfully for the Pabst Farms development, there is still time to turn things around. If the developers choose to do so, they can build a legitimate mixed-use community, instead of building sprawling, parking lot encircled buildings that are single-use and only next to buildings used for the same purpose.

There isn’t anything wrong with the idea of Pabst Farms on paper. It’s proposed as “the conveniences and amenities of an urban area in a breathtaking Lake Country setting. Pabst Farms offers a complete living experience by integrating residential, retail, and commercial environments into one thoughtfully developed master-planned community.” The unfortunate thing is that this isn’t how it’s being built to-date. Industrial, commercial, and residential land is separated, pedestrian access within even the different single-use areas is discouraged by using long, winding roads instead of short, interconnected streets that make pedestrian travel easy, and the beauty of Lake Country is turning into the beauty of grass yards.

Thanks to our friends at Ocono.com who asked for our input on the latest news at Pabst Farms. Here’s to hoping they get it right in the future.

Resolution 080209 changed the operating plan and structure of Business Improvement Distict No. 41 which represents the Downer Avenue business district. The changes would enlarged the board from five to seven members and it would adjust various line items within the proposed operating plan to allow the BID greater flexibility in their future operations. Although this resolution seems inoucous enough it gives the appearance as though these changes are connected to New Lan Enterprises’ controvsional re-development efforts on Downer Avenue. It appears this way because while Alderman Kovac has worked to expand BID No. 41 both Boris Gokhman and Joel Lee have had their appointments to BID No. 41 held in committee. This resolution was approved by the committee and will go before the full Common Council.

The remains of the concrete from the Pfister & Vogel Tannery are being ground up over the next month. The resulting rubble will be reused and recycled to build the foundation for the North End development on the site.

To accomplish the task the Mandel Group has brought in a 13-foot tall, 72-ton quarry grade crusher that will chew through 1,500 tons of concrete a day. Awesome.