Eyes on Milwaukee
Redevelopment Plans Dropped For Downtown Post Office
R2 sells the building to post office real estate investment trust.
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R2 sells the building to post office real estate investment trust. Back to the full article.
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“This asset fit our strategy of buying assets with asymmetric upside and manageable downside,” said Garrison in a LinkedIn post. “In this case, we generated significant free cash flow backed by U.S. government credit while we pursued opportunistic outcomes, the definition of a covered land play. We exited to a [real estate investment trust] with a low cost of capital, and will reallocate to new opportunities, with the strategy of managing risk while setting up for opportunity.”
After wading through that word salad, twice, it sounds to me like “we scammed the taxpayers”.
This makes me sad. Another example of the decline of rust belt industrial cities. Milwaukee has been unable to reinvent itself and escape its history of concentrated Black poverty. The causes are complex but the departure of our lackluster mayor may bring some hope.
Not surprising given the specifics of this deal. Also probably best given the evolving nature of downtowns, including Milwaukee’s. I personally believe that downtown Milwaukee is too big for its own good. If we were able to shrink it by 25%-30%, we’d have greater density and activation. I love development, but so much of it happens on the edges, where developers have flexibility of starting with a “clean slate.” (I.e., the Park East Freeway sites, Reed Street Yards, etc.)
How much new commercial/retail space can downtown absorb given Milwaukee’s static commercial growth. Lose Johnson Controls, gain Milwaukee Tool and Rexnord. Companies eager for new Class A buildings leave older ones to become residential–a totally valid conversion–or struggle to find tenants. Commercial growth requires business growth. Big companies like Johnson Controls and Fiserv want access to talent, convenient (global) air travel, and cultural amenities. MKE has the last and some of the first.
We’ll see what happens with the Buck’s retooling of their Deer District plan and the updated Downtown Plan. I suspect the Buck’s will cancel plans for a 10-story office building in return for wanting a convention hotel on the former Bradley Center site. Then, the Vel Phillips and Wisconsin Avenue site will be promoted for something else. Who knows? Where will that new esports facility go that MKEsports Alliance wants in the coming years…? 🙂