ThriveOn King Project Grows By $20 Million
Cost of ambitious project now $105 million. Plus: A recap of the week's real estate news.
The ThriveOn King project, a conversion of the former Schuster’s department store into apartments and office space, is moving forward, but at a much greater cost.
By Nov. 2019, the Common Council approved a $12.6 million tax incremental financing subsidy to support what was then a $84.5 million project.
In Sept. 2020, project partners announced a new name, ThriveOn Collaboration, for the historic 400,000-square-foot complex and surrounding neighborhood engagement effort and that things were still on track for a 2022 opening. “Hopefully January 2022,” said Royal Capital president Kevin Newell.
Then in January, the partners announced a final building name, ThriveOn King, as part of the larger “collaboration,” and that construction would begin in the coming weeks. “We are going to walk and chew gum,” said Newell.
But construction never started.
Now a revised term sheet is back before the City of Milwaukee, with a higher project cost and new start date.
The city’s contribution, which comes as a developer-financed TIF that functions effectively as a property-tax rebate, remains unchanged. But all of the other amounts have grown, reflecting revised plans and increasing construction costs.
A key driver of the cost change is the increased number of apartments. The original plan called for 77 apartments, with 53 set aside at below-market rates. The new plan calls for 89 apartments, with 74 set aside at below-market rates.
Specific units would be set aside for individuals making below 30%, 50%, 60% and 80% of the area median income. Through the low-income housing tax credit program, those rents are capped at 30% of household income for each income threshold.
The revised term sheet also has a new start-by date: Feb. 28, 2022. Construction must be substantially complete by June 30, 2023 to access the TIF support.
The term sheet lists 100,000 square feet of office space, down from 131,000, and 50,000 square feet of early childhood education and community use space, up from 10,000. GMF and MCW have conducted a sustained collaboration with area residents to envision what uses they would like to see in the complex.
The city’s contribution to the project would come after the development team has first expended the funds. Following completion of the project, the city’s liability will start to accrue interest at 5.5% per year for up to 25 years. It is during that period that the development team would be repaid in an amount not to exceed the property taxes it pays.
Consistent with the earlier agreement, the $12.6 million would grow to $15 million in the event the property is assessed for at least $45 million.
In exchange for the city support, the project will be required to have 40% of its construction work hours performed by unemployed or underemployed city residents, spend 25% of its construction budget and supply budget and 18% of its professional services budget with Small Business Enterprises, and comply with the Anti-Displacement Neighborhood Preference Policy that sets aside units for area residents experiencing displacement.
The oldest building in the complex was built in 1907 as a home for Schuster’s Department Store and expanded many times. The Gimbels chain acquired Schuster’s in 1961 and operated the store until 1969. It was used as a warehouse by Gimbels (which eventually went out of business) until 1992 according to city records. It was then acquired by CH Coakley. which used the building for storage and office space. Many of the former department store fixtures, including escalators, can still be found in the building.
A new parking garage would be constructed on the southwest corner of the block with approximately 315 stalls. Loading docks would be demolished along N. Vel R. Phillips Ave. creating a new, open-air entry area.
Included in the deal is a warehouse located across the street from the building at 2212-2228 N. Vel R. Phillips Ave. Royal Capital would redevelop that property as a “wellness” facility according to a 2019 site plan.
The development team purchased the buildings in Dec. 2020 from Coakley for $9.24 million.
March 2019 Unveiling
2015 Facade Exposure
Renderings and Site Plans
321 Jefferson Fills Up
The Historic Third Ward‘s newest apartment building quietly began welcoming its first residents in recent months.
The seven-story, 60-unit building is billed as luxury housing with floor plans ranging from an 821-square-foot, one-bedroom layout to a 1,945-square-foot, two-bedroom, 2.5-bath layout spread over two floors. A variety of one, two and three bedroom floor plans are available.
The Bindery Glues Together Milwaukee Creatives
Zachary Lifton didn’t set out to save a book bindery.
But when Lifton got turned around while looking for his car while exploring Bay View, it set in motion a series of circumstances that led to the development of the city’s newest creative hub, The Bindery.
Milwaukee Solar Program Has Record-Setting Year
A public-private partnership continues to power itself to new heights.
The Grow Solar Grower Milwaukee group buy program, designed to reduce the cost of installing solar panels, set a new record this year with 64 properties adding solar panels capable of producing 421 kilowatts of electricity.
Launched in 2013, the 2021 installations represent 33% of the total capacity of 1,292 kilowatts installed throughout the life of the program. But that also points to the growing efficiency of the panels, as the 64 participants this year represent only 23% of the lifetime participants (282).
Stone Creek Closing Bay View Cafe
“This was not something we had planned. We love this cafe and the Bay View community. We just finished remodeling and investing in our exterior seating area at the end of this last summer, and we were developing plans to refresh the cafe interior as well,” said the company in a Facebook post.
A citizen complaint raised concerns about the wall in late August.
“South Building Façade in imminent risk of collapse. Southwest corner of building gap at top of building between brick veneer has increase [sic] from 1 inch to 2 inch and now is at 4 inches. Temporary columns installed at south awning however awning not designed to take on that kind of load,” says the complaint to the Department of Neighborhood Services.
“It is not an imminent fall hazard. It is not going to collapse,” said DNS division manager Michael Mannan in an interview Thursday morning.
Should City Buy 30th Street Railroad Line?
The City of Milwaukee has big dreams for a lightly-used rail line that bisects the middle of the city.
The 6.7-mile 30th Street Corridor could be used for a paved trail for cyclists and pedestrians. The rail line itself could also be used as part of a larger commuter rail system. It’s a grade-separated corridor that runs from the Menomonee Valley north to W. Hampton Ave.
[Alderman Robert Bauman] introduced a file that requests the city administration to begin negotiations with Watco, the line’s current owner, about purchasing the corridor. “With the exception that they would continue to have access for freight service,” he said.
Furniture Store To Become Apartments
For 118 years, the goal of the owner of the building at 1534-1542 N. Farwell Ave. has been to get people to carry furniture out of the building. Soon people are more likely to be carrying furniture into the building.
An investment group led by Illinois-based real estate investor Samuel Grossman acquired the Paul Weise Furniture Building for $900,000 and will convert the building to high-end apartments as part of a $3 million project.
It’s just the latest investment on Milwaukee’s East Side for Fairchild Acquisition, but it marks a notable change. Instead of rehabilitating an existing apartment building, Fairchild will be changing the entire use of a structure.
Affordable Senior Apartments Get Plan Commission Approval
Developer Cornelius McClendon secured an endorsement Monday from the City Plan Commission to support his redevelopment of the former industrial complex at 3040-3100 W. Meinecke Ave. into affordable senior apartments.
His firm, McClendon Capital Group, would redevelop the four-building complex with support of the state’s low-income housing tax credit program. McClendon is seeking credits that are reserved for seniors making 30%, 50% and 60% of the area’s median income. In exchange for accepting the credits, developers set aside specific units at rental rates not to exceed 30% of a household’s income.
“The project is a complement to The Community Within the Corridor two blocks away,” said McClendon of the 197-unit project built by a separate development team. That project, currently under construction, is targeted at families. “We are creating generational housing in relation to each other.”
Altoro Leaves WHEDA for Federal Position
It was easy to call Joaquín Altoro a rising star in 2019 when he made the jump from Town Bank to the top job at the Wisconsin Housing and Economic Development Authority (WHEDA). Now he’s a shooting star headed to Washington D.C.
Altoro, a Milwaukee resident, will serve as Administrator of Rural Housing Service within the U.S. Department of Agriculture’s Rural Development agency. He will oversee programs that provide loans and loan guarantees to develop rural housing. The USDA announced the appointment, not subject to Senate confirmation, Monday.
Port Seeks To Develop Cruise Ship Dock
The City of Milwaukee is seeking a partner to develop a five-acre parcel that sticks out in Lake Michigan.
But don’t expect to see a new tower or other residential development. The parcel is on filled lakebed and any future use must comply with the Wisconsin Public Trust Doctrine.
“The Site is available for development of recreational, entertainment, tourism, cultural, passenger vessel and public access uses,” says a request for interest (RFI) issued Monday by Port Milwaukee.
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Related Legislation: File 211120
- Plats and Parcels: ThriveOn King Project Grows By $20 Million - Jeramey Jannene - Nov 14th, 2021
- ThriveOn King Aims to Transform North Side - Caroline White - Feb 20th, 2021
- Eyes on Milwaukee: Former Gimbels Will Be “ThriveOn King” - Jeramey Jannene - Jan 26th, 2021
- Foundation makes new impact investments of more than $11 million - Greater Milwaukee Foundation - Dec 18th, 2020
- Eyes on Milwaukee: $85 Million Bronzeville Project Now “ThriveOn Collaboration” - Jeramey Jannene - Sep 10th, 2020
- Eyes on Milwaukee: City Subsidy for Schuster’s Project Okayed - Jeramey Jannene - Nov 19th, 2019
- Eyes on Milwaukee: RACM Approves Deal for Schuster’s - Jeramey Jannene - Oct 17th, 2019
- Eyes on Milwaukee: City Contributing Up To $15 Million to Schuster’s Project - Jeramey Jannene - Oct 4th, 2019
- Eyes on Milwaukee: $100 Million Will Transform Old Schuster’s - Jeramey Jannene - Mar 26th, 2019
Read more about Schuster's redevelopment here