Investor Buys Signature Downer Ave Properties
Seattle firm acquires much of East Side commercial corridor, including Downer Theatre building.
Downer Theatre. Photo by Jeramey Jannene.
Much of the N. Downer Ave. commercial corridor changed hands this week for nearly double its assessed value, including the building that houses the Downer Theatre.
An affiliate of Seattle-based Bridge33 Capital acquired the buildings at 2551-2597 N. Downer Ave. and 2608-2650 N. Downer Ave. Those otherwise innocuous addresses include buildings occupied by the theater, Boswell Book Company, Cafe Hollander, Starbucks, Stone Creek Coffee and Pizza Man.
“Comprised of two buildings, The Downer Avenue Retail Collection features an e-commerce proof roster of fitness, service, entertainment, food & beverage, office and residential uses,” says a listing document. Combined, the properties have 60,986 square feet of leasable space and are 78 percent leased according to the property marketing materials.
C-III acquired the properties in a foreclosure sale in 2015 for $6.5 million. The properties had previously been owned by Milwaukee real estate investor Joel Lee and his firm Van Buren Management.
Lee’s investment group had a $10.5 million mortgage on the property and quit making payments in 2014. The city declined to create a tax incremental financing district to back Lee’s redevelopment of the area, as colorfully described in a 2015 piece by Michael Horne.
“No other two-block stretch of the city has so many amenities,” said area Alderman Nik Kovac in 2015. And now much of that two-block stretch is under new ownership.
Convention Center District Authorizes $420 Million Expansion, Raises Hotel Tax
The Wisconsin Center District (WCD) board authorized a $419.9 million expansion of Milwaukee’s convention center Thursday morning alongside raising the county hotel tax from 2.5 to 3 percent, extending the food and beverage sales tax past its 2033 expiration and authorizing refinancing up to $150 million in debt.
The 17-member board, participating via the phone, spent over an hour debating the merits of authorizing the expansion amidst an unprecedented global shutdown and the potential the district could default on its existing debt. A total of 61 events have been canceled or postponed at the Wisconsin Center, Miller High Life Theatre and UW-Milwaukee Panther Arena.
The expansion plans call for adding 112,000 square feet of space to the exhibition hall, creating a 300,000-square-foot hall. A ballroom would be included in the expansion with a minimum of 30,000 square feet of space and a seating capacity of at least 2,000. A total of 24 meeting rooms would be added to the building.
Renderings
St. Rita Square Nears Completion
Construction work is nearly complete on St. Rita Square, a new, 118-unit senior housing complex on the Lower East Side. Much of the final facade has been installed on the six-story complex.
Senior housing specialist James A. Tarantino is developing the complex on the site of the former St. Rita Catholic Church. The church will be replaced by a modern recreation of long-since demolished Blessed Virgin of Pompeii Church in the Historic Third Ward.
Photos
Real Estate Survey Shows Big Changes
A 14-question survey of the members of six Milwaukee real estate industry organizations sheds insight into how businesses are grappling with challenges related to COVID-19 and what the real estate industry is doing in response.
Strategies include everything from extending leases in exchange for lower payments during the pandemic and switching to interest-only payments on loans to preparing to buy properties from panicked sellers and planning for cheaper construction prices.
The 345 survey respondents include developers, attorneys, brokers, property managers, lenders and construction professionals.
The responses offer guidance to business owners faced with diminished or no revenue on how they could respond to their landlords and lenders.
State Fair Park Selected for Overflow Care Facility
Local leaders have selected the Wisconsin State Fair Park Exposition Center as the first location where an alternative care facility will be built out. The move is intended to provide extra hospital bed capacity to deal with an expected surge in COVID-19 cases.
The Wisconsin Center and the State Fair Park locations were studied earlier this week as potential facilities for additional healthcare capacity. But the Wisconsin District Center will only be used in the event that the surge is greater than predicted and the state fair park facility fills up.
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Plats and Parcels
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A Four-Way Preservation Fight Over Wisconsin Avenue
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I’m very concerned about the price thee guys paid for this iconic property. Since I moved to Milwaukee in 2004, every proposal I’ve heard about revitalizing this block has failed. Yes, the development of the location for Pizzaman was significant. The preservation of the Downer Theater and Boswell’s books is fabulous. But when you compare the history of this block to the 2600 block North of it, North Ave, Prospect, Farwell, and Brady Street, you have scratch your head and wonder. Is this purchase price lead to a rent increase, more closures, and unattainable plans to fill these empty storefronts?
I am not sure Seattle folks have MKE in mind other than a place to make a pile of dough. This is from their website:
“We cultivate a flexible and nimble culture that enables us to identify and quickly capitalize on unique, opportunistic investments. Individually and as a collective team, the entire Company has a relentless drive to create value for our investors. We embrace an entrepreneurial ethos, disciplined acquisition, and intense property management in our drive to be a best-in-class real estate investment company.” Downer is their only WI property. Other Midwest properties are strip malls. And it seems the rest are strip malls across the country. So maybe they are good at finding occupants for mall type settings? Hopefully these place based buildings will remain.
If the DNC in Milwaukee is diminished or even canceled due to the pandemic, would Milwaukee be eligible to host in 2014? Just speculating and inquiring!