Dairy-Centric Apartment Building Wins Plan Commission Approval

A proposal to redevelop a two-story industrial building into apartments on Milwaukee’s East Side secured its first approval Monday afternoon.

Developer Kendall Breunig would convert the building at 1617-1633 E. North Ave. to 17 apartments. But that would involve rezoning the property from “Industrial Light, IL2” to “Local Business, LB3.”

A Wisconsin Historical Society report on the 29,076-square-foot building says the structure was built in 1946 for Dairy Distributors, Inc. It describes the style as Art Moderne.

The building includes a bar, though not for the type of drinking done in most Milwaukee bars.

“You would sit down at a 50s-style and have a cold glass of milk while they brought the rest of your dairy products,” said Breunig, who leads Sunset Investors.

He hopes to save the space for a commercial tenant. “I have been trying to find someone in the area to put an ice cream shop or something like that in,” said the developer.

Apartment units would average approximately 1,000 square feet each. Floor plans would consist of a mix of one- and two-bedroom layouts. Breunig said, given the neighborhood, he expected to draw college students at market-rate rents.

A total of 21 parking spaces would be located inside the building.

The apartments located on the western side of the building would have internal balconies. “Provided of course the National Park Service approves that arrangement,” said the developer. Why does the park service get a say? Breunig intends to use historic preservation tax credits to finance the deal. The building was identified as likely eligible on a recent industrial property survey and Breunig is working through the approval process. Tax credits are provided in exchange for the restoration of historical features of structures.

Alderman Nik Kovac is supporting the project. “He is excited about the adaptive reuse of a historic property,” said his aide Amanda Cervantes. Kovac was attending a closed session meeting of the Steering & Rules Committee to discuss the city’s pension-induced fiscal crisis.

The commission unanimously endorsed the change. The Common Council will need to take a formal vote on the matter. The property is also located within the boundaries of the East Side Business Improvement District #20, which is used to define the boundaries of the East Side Architectural Review Board. That board would need to approve any exterior design work.

A limited liability company affiliated with Breunig acquired the property for $600,000 in 2017 from Downtown Books owner Robert E. John. It was acquired by John in 1999 for $150,000 from power equipment manufacturer Trombetta, which had spent decades in the facility before relocating.

Breunig’s limited liability company is named for his former self-storage business. But the developer sold the active storage properties last year for $37 million. He has invested at least some of the proceeds in a number of new properties, a common move that reduces capital gains taxes.

In June an affiliate of his firm, Sunset Investors, purchased the U.S. Citizenship and Immigration Services office building at 310 E. Knapp St. for $4.75 million. It also purchased the former St. Francis Brewery in suburban St. Francis for approximately $1.43 million in July.

His firm is also adding more than 70 units to the Plankinton Lofts complex, a series of office condominiums Sunset has acquired and redeveloped atop the Plankinton Arcade building.

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