Schuster’s Returns to King Drive

Schuster’s is back. Well, sort of.

There are no plans to reopen the long-gone department store, but, for the first time in decades, you can see the facade of its former flagship store, 2153 N. Martin Luther King Jr. Dr.

The contracting partnership of CG Schmidt and JCP Construction has made substantial progress on removing the metal panels that shrouded the former department store since 1984. Work began in late June. The effort is part of a $105 million ThriveOn King project that will turn the department store complex, long used for storage, into a mix of housing, office space and community-focused commercial space.

“The Schuster Building is an outstanding example of the Chicago Commercial style in the area. Its proportionally large glass area and ‘Chicago’ windows are very characteristic of the style, and are significant features. Although it includes Neo-Classic Revival details at the top, the design makes a clear departure from the use of most historical references in favor of a bold statement of structural clarity,” says a Wisconsin Historical Society report that long relied on looking at old photos to be believed.

In addition to removing the paneling, interior demolition and environmental abatement work are also underway. The multi-building complex’s facade will be restored by Advanced Restoration. The oldest building in the complex was built in 1907 as a home for Schuster’s Department Store, with several successive expansions filling much of the block just south of W. Garfield Ave. The first building was designed by Kirchhoff & Rose and is now almost entirely exposed. A 1914 building to the west remains largely covered. A mid-century building to the south has had its paneling removed, but contains none of the historical charm of the original building.

The Gimbels chain acquired Schuster’s in 1962 and operated the store until 1969. It was then used as a warehouse by Gimbels (which eventually went out of business) until 1992, according to city permit records. CH Coakley acquired the building in 1992, using it for storage and office space. Many of the former department store fixtures, including escalators, could still be found in the building.

ThriveOn King is a partnership between Royal Capital Group, the Greater Milwaukee Foundation (GMF) and the Medical College of Wisconsin (MCW). The partners, operating as the ThriveOn Collaboration, first announced the project in 2019 and have engaged with neighborhood stakeholders to solidify the first-floor uses. A block party was held this week to connect with area residents about the project and celebrate the start of construction.

The project is being funded in part with federal and state historic preservation tax credits that require historically appropriate repairs to be made to both the interior and exterior of the complex. The redeveloped department store will include 89 apartments on its western side. The eastern side will include office space for MCW’s community-facing programs on floors two and three and a new home for GMF on the fourth floor. First-floor tenants include a food hall, Malaika Early Learning Center and a Versiti blood donation and education facility. Royal Capital senior project manager Terrell J. Walter told Urban Milwaukee in June that approximately 14,000 square feet of office space remains available for lease.

Engberg Anderson Architects is leading the redevelopment’s design.

Seventy-four of the 89 apartments will be set aside at below-market rates through the low-income tax credit program. Specific apartment 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. Twenty-seven of the apartments will be additionally restricted for seniors.

The city approved providing up to $15 million from a developer-financed tax incremental financing (TIF) district to support the development. The structure is effectively a property tax rebate if the building hits a minimum assessment threshold and places the risk on the development team.

Other funding sources include $48.5 million in commercial loans, $22.5 million in historic preservation tax credits, $9.4 million in low-income housing tax credits, $8.5 million in developer equity and $3.5 million as a deferred developer fee.

In exchange for the city financial support, the project is required to have 40% of its construction work hours performed by unemployed or underemployed city residents through the Residents Preference Program (RPP), as well as spending 25% of its construction and supply budget and 18% of its professional services budget with Small Business Enterprises. It will also need to comply with the Anti-Displacement Neighborhood Preference Policy that sets aside units for area residents experiencing displacement.

“We’re invested in terms of hitting our city goals,” said Walter in June. He said RPP workers have been able to successfully move from the firm’s Phillis Wheatley School redevelopment to the ThriveOn project, despite the different contracting firms involved. “We’re actually seeing from the Royal Capital side a lot of teammates that came from our Phillis Wheatley project and have family-sustaining jobs.” Cross Management Services is working with the development team to manage the contracting requirements.

Construction is expected to take approximately 18 months.

The ThriveOn partners paid Coakley $9.4 million for the property, and an adjacent, much-smaller warehouse, in 2020. The smaller warehouse is poised for redevelopment into a high school.

Photos

June Photos

Renderings and Site Plans