Lakefront Tower Loses A Few Floors
Plus: Northridge Mall trial starts, Foxconn bailing on project could cause up to $120 million state bailout.
Originally pitched in 2016 for a vacant lot at 1350 N. Prospect Ave., the tower was originally intended to 235 apartments over 24 floors. It was reduced in 2018 to 20 stories and 180 units.
Now it could be much shorter.
“Due to the reluctance of the City to provide financial support, we also are exploring a mid-rise (7 to 12 floors) instead of a high-rise, to reduce the cost of construction without diminishing the quality of the apartment building,” Mandel wrote in a report to Milwaukee County. The county once owned the site as it slated decades over for a never-built freeway loop.
“We would love to see a city high-rise at that site,” said Department of City Development Commissioner Rocky Marcoux this week to Daykin. “However, a mid-rise that’s developed completely without city assistance is completely acceptable to us.”
Mandel said it would present both options to the city.
The city, under Mayor Tom Barrett and Marcoux, has often opposed subsidizing high-end housing. It did provide a loan for the condominiums at the top of The Moderne apartment tower that was paid back. And it is funding the base of The Couture, should the rest of a financing package be assembled, via tax incremental financing so that a public transit concourse is included. Other projects have been privately financed.
The city, through the Housing Authority of the City of Milwaukee and its Travaux arm, is proposing to develop its own housing high rise, Convent Hill South, as part of a new model to create affordable housing. That development would rely on private financing.
The Portfolio news comes the same week as Mandel predicted an overall slowdown in the number of apartments developed in Milwaukee.
Northridge Mall Trial Underway
Reporter Alex Zank carried the laboring oar for Milwaukee real estate reporters this week, having spent two days in a courtroom at the Milwaukee County Courthouse as the trial over the future of Northridge Mall got underway.
The vacant mall’s owner, U.S. Black Spruce Enterprise Group, is appealing the city’s decision to raze the structures it deems hazardous. The city can condemn a property if the estimated costs to make the property code compliant exceeds 50 percent of the property’s value.
Wednesday’s hearing centered around the testimony of Department of City Development project manager Benjii Timm.
The case will resume in February.
Report Details Potential Foxconn Problems
Foxconn and its ever-changing Wisconn Valley development in southern Racine County could cause problems for the state if it fails to materialize as expected under a worst-case scenario projection.
While the state incentives are tied to hiring or investment, payback on infrastructure work undertaken by Racine County and Mount Pleasant relies on Foxconn’s property tax payments. Should Foxconn break an agreement, the state could be forced to make up to $120 million in bailout payments.
The report estimates that Foxconn’s development and other projects within a tax-incremental financing district would soon be assessed at $522 million, 37 percent of the $1.4 billion the district is scheduled to be assessed at by 2023.
The report, which deems Foxconn hitting its original projections as “unlikely at present,” considers a scenario where no more incremental development occurs.
The halting of future development would cause the state-enabled $764 million tax incremental financing district, used to fund infrastructure near the project, to fall into default on paying back its associated debt if Foxconn breaks its financing contract.
Under the contract, Foxconn is required to pay property taxes, even if the project’s value falls short of projections, based on a planned assessed value of $1.4 billion. But the scenario considers Foxconn reneging on the deal. The state, through the enabling legislation, would then be on the hook to pay back up to $120 million in debt.
In a statement, Racine County officials said the outline was simply considering “what if” scenarios.
Foxconn’s plant under construction today is estimated to be valued at $400 million when complete. Its existing multipurpose building, server building, data center, electrical substation and other developments are estimated to fetch an assessment of $122 million.
Symphony’s New Home Takes Shape
Having successfully moved a wall weighing over 600 tons 35 feet to the east, CD Smith has gotten down to the business of building the structure that will surround the Milwaukee Symphony Orchestra‘s (MSO) new $89 million home in the former Grand Warner Theatre.
A steel structure, which will eventually be home to a two-story lobby complex at the northwest corner of N. 2nd St. and W. Wisconsin Ave., is nearing completion. While we’re months away from the glass facade being complete, the steel framework gives a sense of the mass that the new building will project along Milwaukee’s main street. The new structure is built atop the site of the sushi restaurant that was demolished by the MSO, which itself was built on the site of a former office tower. All have used the same foundation, which is visible in a few of the photos.
Behind the theater a new brick structure is nearing completion that is designed to mirror the look and feel of the historic theater. The structure holds a number of facilities not included in the 1931 movie theater, notably changing rooms for the musicians and a substantial number of restrooms.
The two pieces bookend the theater itself, which will now have a stage large enough to host a full orchestra after the 100-foot-wide, 86-foot-tall wall was relocated (with the help of Dove soap). Many of the bricks removed to enable the wall to be moved have been reinserted and an extension of the theater’s wall structure has been completed reuniting the back wall with the rest of the theater.
Second New East Side Home Revealed
The developers, who lead New Land Enterprises, plan to ultimately build three homes on a rare vacant lot along N. Terrace Ave. just north of E. North Ave. The site was created following the completion of Ascension‘s 2005 redevelopment plan for the St. Mary’s hospital.
Gokhman spent over a year negotiating with neighbors and the Historic Preservation Commission regarding the plan for Shuk’s house before receiving unanimous approval from the commission in November.
Project architect Jason Korb, principal at Korb + Associates Architects, and Gokhman originally proposed a distinctly modern two-story home with a flat roof, before swapping it for a new design with a pitched roof and much more vertical emphasis and traditional material palette. The revised proposal drew praise from the commissioners and commission staff. Staffer Carlen Hatala characterized the proposal as “contemporary in design, but compatible with the historic district.” Learn more.
City to Sell 19 Lots for Habitat Homes
The Common Council’s Zoning, Neighborhoods & Development Committee approved selling 19 lots to the non-profit for $1 each.
The lots are located in an eight-block cluster between W. Keefe Ave., N. 1st St., W. Townsend St. and N. 3rd St.
Habitat construction manager Chris Garrison said the organization will build eight homes in Harambee in 2020 and nine in 2021 as part of a five-year campaign.
The homes, which range in size from 1,100 to 1,400 square feet, include up to four bedrooms. Owners pay $85,000 to $90,000 for the properties after putting 250 hours of “sweat equity” into the project, including financial literacy training. Learn more.
A New Design for Villard Avenue
The Department of City Development (DCD) and Villard Avenue Business Improvement District #19 will partner on developing a vision for the future of up-to six catalytic sites along the commercial corridor.
The process, known as a design charette, is centered around community stakeholders developing a shared vision for each site. Participating design firms create renderings of conceptual projects. It will be the 13th time the city has hosted a charette in a Milwaukee neighborhood.
“We are hoping we can keep the momentum up on Villard behind the new Villard Commons,” said Villard Avenue business improvement district (BID) manager Angelique Sharpe of an apartment building that recently had a groundbreaking.
The Common Council’s Zoning, Neighborhoods & Development Committee unanimously endorsed appropriating $10,000 for the effort on Tuesday morning. The BID is required to provide $10,000 in matching funds.
“We think this will provide additional guidance for our current owners and potential entrepreneurs,” said Stephanie Harling. The Havenwoods Economic Development Corporation, led by Harling, provides staffing for the Villard Avenue BID.
City Deconstruction Delayed Through 2020
Milwaukee officials continue to push the pause button on an ordinance requiring that homes built before 1930 be deconstructed instead of mechanically demolished when razed.
The ordinance, championed by council members Robert Bauman and Nik Kovac, was first passed in late 2017 with a focus on creating jobs for low-skilled workers, salvaging materials, including hard-to-find old-growth lumber and diverting up to 85 percent of the structure from the landfill. It applies to both private and city-owned homes with one to four units.
But the city has struggled to find contractors that can perform the work consistently and affordably, preventing a market for the materials from forming and driving costs higher. The Department of Neighborhood Services (DNS) reported that bids for city work were coming in at approximately $60,000 per property, double what was expected. That led the Common Council to approve a one-year stay on the requirement in January 2019.
Tuesday morning the Common Council’s Zoning, Neighborhoods & Development Committee voted unanimously to extend the moratorium through March 1st, 2021.
“We are extending the stay of the deconstruction ordinance for one more year to allow the department to develop capacity,” said Bauman regarding the Department of Neighborhood Services (DNS).
A companion file, unanimously sponsored by the committee, will create a formal training process for firms performing deconstruction. Read on.
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- State Reviewing Foxconn Jobs Report - Erik Gunn - Jul 23rd, 2020
- Foxconn Hosts Smart Manufacturing Web Conference, Launches iAI Institute - Foxconn Technology Group - Jul 10th, 2020
- Foxconn Will Make 10K Ventilators - Corri Hess - Jun 19th, 2020
- Medtronic and Foxconn Partner to Increase Ventilator Production - Foxconn Technology Group - Jun 18th, 2020
- Foxconn Audit Delayed Two Months - Erik Gunn - Jun 3rd, 2020
- Back in the News: Foxconn’s Profits Plunge By 90% - Bruce Murphy - May 19th, 2020
- Foxconn to Assemble Procedural Masks in Wisconsin for Pandemic Relief - Foxconn Technology Group - Apr 20th, 2020
- Murphy’s Law: Foxconn Squeezes Evers - Bruce Murphy - Apr 15th, 2020
- Foxconn Says It Earned Tax Credits - Corri Hess - Apr 9th, 2020
- Back in the News: Foxconn Plant Will Make Ventilators - Bruce Murphy - Apr 8th, 2020
Read more about Foxconn Facility here
- Plats and Parcels: Historic Church Will Become High Tech Office Space - Jeramey Jannene - Jun 28th, 2020
- Eyes on Milwaukee: Judge Rules Northridge Mall Must Be Demolished - Jeramey Jannene - May 14th, 2020
- Plats and Parcels: Lakefront Tower Loses A Few Floors - Jeramey Jannene - Jan 19th, 2020
- Plats and Parcels: Journal Sentinel Complex Sold - Jeramey Jannene - Nov 3rd, 2019
- Eyes on Milwaukee: City Preparing Interior Demo of Northridge Boston Store - Jeramey Jannene - Sep 23rd, 2019
- Eyes on Milwaukee: Northridge Mall Lawsuit Filed - Jeramey Jannene - Aug 26th, 2019
- Plats and Parcels: Bucks Vetting Bids For New Hotels - Jeramey Jannene - Jul 21st, 2019
- Plats and Parcels: BMO Tower Tops Out - Jeramey Jannene - Jun 23rd, 2019
- Eyes on Milwaukee: Nothing New in Northridge Mall Plan - Jeramey Jannene - Jun 6th, 2019
- Eyes on Milwaukee: Asian Market at Northridge By 2021? - Jeramey Jannene - May 28th, 2019
Read more about Future of Northridge Mall here