Convention Hotel, Theater Demolition Plan Gets Cold Reception

Convention headquarters hotel conceptual design. Renderings by tvsdesign for Wisconsin Center District.

A proposal to demolish the Miller High Life Theatre and replace it with a 650-room hotel faces several challenges.

“A convention hotel is not financeable at this time,” said Mark Flaherty, managing partner at hospitality firm Jackson Street Holdings and a Wisconsin Center District board member, in an interview with Urban Milwaukee.

A newly published report says that after the $456 million Baird Center expansion was completed, Milwaukee “is now meeting space heavy, hotel room light and behind on hotel quality.” The Wisconsin Center District (WCD) hired consulting partner Hunden Partners to prepare the report last year.

“I encourage all board members to read the report with an open mind,” said board chair Jim Kanter, an executive with Central Standard Craft Distillery, during Friday’s board meeting. “There was not a predetermined outcome, and the findings speak for themselves.”

The board accepted the report and created a new committee to review it ahead of the board’s May meeting. County Comptroller Liz Sumner will chair the committee, which also includes downtown Alderman Robert Bauman, Northwestern Mutual Vice President Grady Crosby, Wauwatosa Mayor Dennis McBride and Republican Party leader Gerard Randall.

The report analyzed six sites for a potential hotel. Hunden’s analysis concluded that the historic theater was the best to demolish because of its limited use compared to other WCD properties, its proximity to the convention center and the alleged loss of business to the soon-to-open Landmark Credit Union Live concert venue, 1051 N. Vel R. Phillips Ave.

But one of Milwaukee’s leading concert bookers doubts that final claim.

“You don’t put Seinfeld, Cirque du Soleil, Mariah Carey, Ringo Starr or Nikki Glaser in a standing G/A club with a flat floor,” wrote Witt. “If we tear High Life down, those shows don’t ‘move’ to the Deer District—they just stop coming to Milwaukee and Wisconsin entirely because we will no longer have a venue that meets their technical rider. The above is a free lesson for the Hunden Partners who charged [WCD CEO] Marty Brooks (and us the taxpayers) $100,000 to provide ‘the truth’ through data, while somehow not really using the data or actually finding any truth other than what Marty asked them to find.”

Flaherty is opposed to a subsidy to construct the hotel.

“I don’t think it’s fair to the other hotel owners. We’re barely filling up our stuff now,” he said. Jackson Street owns the Milwaukee Marriott Downtown, The Westin Milwaukee and SpringHill Suites (Commerce Building).

Does he believe Hunden’s claim that building the hotel would generate new business that fills other hotels and raises room rates?

“No.”

“They want to bulldoze this public treasure for a generic hotel—funded by your taxes—to benefit one private hotel operator while screwing over every other hotel downtown,” wrote Witt.

Greg Marcus, CEO of Marcus Corp. and a WCD board member, also said he doesn’t believe a hotel can be built without a subsidy.

Bauman is not sure a human wrote the report.

“I wonder who wrote it. It looks like an artificial intelligence app,” said the alderman. He cited several errors in the education market analysis, including one that placed UW-Whitewater in Illinois and another that placed the convention center in Oak Creek.

He also cited Witt’s concerns about comparing the two venues. “They’re just plain wrong when they make that comparison,” said the alderman. Bauman also cited the report’s claim that there was a hotel under construction in the Historic Third Ward. “Nobody knows what that is.”

Bauman said he will push for the development of the city-owned parking lot at 401-441 W. Wisconsin Ave., located on the south side of the convention center. “Clearly, the [Vel R. Phillips Plaza] site is the most logical,” he said. “If you’re going to subsidize one, that is the most logical place to put it.”

He also questioned the decision not to include the parking lot at 601 W. Wells St. in the study.

The report does not address financing. Sumner said the new committee would stick to discussing the content of the report.

Kanter said he was pleased that the report didn’t recommend knocking down the UW-Milwaukee Panther Arena, a WCD-owned venue. The anchor tenants, the Milwaukee Admirals and UW-Milwaukee, both previously said they opposed demolishing it and would lack suitable venues without the mid-sized arena.

Bauman last fall successfully pushed for the historic designation of the attached theater and arena. Bauman, a WCD board member and preservation advocate, said he was advancing the designations because of the buildings’ clear historical relevance, so the public would have a chance to weigh in on any possible convention center development.

On Thursday, he told Urban Milwaukee that the study’s recommendation to maintain the building was positive.

WCD spent $145,000 on the Hunden study and a related 20-year capital plan for the theater and arena.

“To some extent, this report states a lot of the obvious,” said Bauman. “Would it be nice to have another 700-room hotel? Sure. Is it financially feasible? Doesn’t appear to be. How do you subsidize it? I don’t know how you subsidize it. You can subsidize the construction with [tax incremental financing], but I don’t know how you subsidize the operations. And even if you did, how do you justify a subsidy to one lucky hotel provider and not do that for the others?”

The convention center district is governed by a board of state, county and local appointees. The district is funded by a variety of taxes, including a half-cent food-and-beverage sales tax and a hotel room tax.

The theater was originally constructed in 1909. Prior district comments indicate approximately $20 million in debt remains from its 2003 renovation.

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