For years, many Milwaukee area shoppers wished that Nordstrom would open a store in the region.
The wait is almost over.
Seattle-based Nordstrom Inc. will open a 140,000-square-foot, three-level department store at Mayfair Mall on Oct. 23. The opening of the store could be the most anticipated commercial real estate development in southeastern Wisconsin for the second half of 2015.
The Mayfair Mall Nordstrom store will have 375 employees, five shoe departments, plus two in-store restaurants: a full-service Mediterranean/Italian restaurant and a coffee shop.
The Nordstrom store will open just more than a year after a Nordstrom Rack store opened in the first phase of the Mayfair Collection development at Burleigh and U.S. Highway 45 in Wauwatosa. Construction continues on the second phase of that project, which will include a Whole Foods store.
Another new entry that could shake up the region’s retail landscape is Grand Rapids, Mich.-based Meijer Inc., which recently opened stores in Grafton and Kenosha.
Those are the first two of several stores that Meijer plans to open in the region. In August, Meijer will open stores in Oak Creek and Wauwatosa. The Wauwatosa store will be just south of the Mayfair Collection.
Meijer also has plans to build stores in Waukesha, Sussex, West Bend, Greenfield and Sheboygan.
Each Meijer store is about 192,000 square feet in size and features general merchandise and full grocery departments.
Meijer’s entry into the southeastern Wisconsin grocery market comes after several other new grocery stores have opened in the region in recent years, including Sendik’s, Walmart, Costco, Woodman’s and Trader Joe’s store locations. Costco will add two more stores that will be built in Menomonee Falls and New Berlin.
The increased number of grocery stores has chipped away at the market share of market leader Pick ’n Save, a brand of Milwaukee-based Roundy’s Supermarkets Inc. Now, with Meijer opening its first stores, it will be interesting to see what impact it has on the region’s grocery industry, and particularly on Pick ’n Save. Last year, Roundy’s closed three Pick ’n Save stores, located in Saukville, Milwaukee and West Allis. Earlier this year, the company said it will close a store in Racine at the end of the year.
As its competition continues to increase, especially with Meijer’s entry in the marketplace, some think Roundy’s will need to close additional Pick ’n Save stores in the region.
“Many of their existing stores are in good locations and will survive,” said David Livingston, Pewaukee-based grocery industry analyst and a former Roundy’s employee. “(But) about half of their locations are redundant. I think about half of the (Pick ’n Save) stores will close over time. I don’t know how long that is going to take. I think they need to get rid of about half of their stores to get their sales per square foot to a reasonable level.”
Mixed-use
The Meijer store in Oak Creek is a major component of the Drexel Town Square project, one of several mixed-use development projects that are under construction in the region.
Drexel Town Square, located southwest of Drexel and Howell avenues, will include the Meijer store, a new City Hall and library building and a Water Street Brewery restaurant, all of which will open by the end of the year. Other components of the project will include luxury apartments, a Froedtert health facility, a mixed-use Main Street, a town square and a hotel.
Milwaukee-based commercial real estate firm Irgens has started construction for The Corridor, a mixed-use project on the 65-acre former Ruby Farm site southwest of Bluemound and Calhoun Roads in Brookfield. Construction work on the infrastructure for the site began recently for the $153 million project, which will include retail space, a hotel, a fitness/wellness facility and office space.
After years of planning and a construction delay of several months, construction finally began earlier this year for The Corners, a $200 million lifestyle center development that is being built on a 19-acre site bounded by West Bluemound Road, North Barker Road and I-94. The site was formerly occupied by Marcus Theatres’ West Point Cinemas and a Menards store. Tenants at The Corners will include a 140,000-square-foot Von Maur department store, a Sendik’s grocery store and an Anthropologie store.
Site work could begin this year for a mixed-use development planned by Cobart Partners northwest of West Layton Avenue and South 84th Street in Greenfield.
Cobalt Partners plans to build a mixed-use development on the site with market-rate apartments, about 200,000 square feet of retail space including a new Steinhafels store, and about 20,000 to 30,000 square feet of office space.
The project will be similar to the Whitestone Station project Cobalt Partners is developing in Menomonee Falls. Construction is underway for Whitestone Station, which is a redevelopment project for a 65-acre brownfield site west of the interchange of U.S. Highway 41/45 and Pilgrim Road. The project includes a Costco store, additional retail buildings and 320 market-rate apartments.
The lakefront
A historic transformation continues to progress on Milwaukee’s lakefront. The only question is: how dramatic will it be?
Northwestern Mutual Life Insurance Co.’s $450 million, 32-story, 1.1 million-square-foot Northwestern Mutual Tower and Commons project is coming out of the ground and will rise skyward during the second half of 2015.
Irgens’ 833 East Michigan project, a 17-story office tower under construction at 833 E. Michigan St., is also making significant progress.
An ongoing legal battle over the official Lake Michigan shoreline could determine if other high-rise projects will join those two at the lakefront. Barrett Lo Visionary Development wants to build a 44-story apartment tower, called The Couture, just east of the 833 East Michigan building. But parks advocacy group Preserve Our Parks says most of the Couture site was originally in the Lake Michigan lakebed and therefore, private development there is forbidden by the state’s public trust doctrine. The county and city have filed suit in an attempt to establish development rights for the site.
That case could also affect the development rights for the site to the south, where Johnson Controls Inc. is considering plans to build a new office tower. The company and city are splitting half of the cost of a feasibility study on the site. Johnson Controls has said little about its building plans, but some sources say the company is considering plans for a building that would be the tallest in the state.
Arena
The elephant in the room for the Milwaukee commercial real estate market is still the proposed new $500 million arena for downtown Milwaukee. The current and former owners of the Milwaukee Bucks have pledged to pay for half of the cost of a new arena, which the NBA says is necessary to keep the Bucks in Milwaukee. State and local leaders negotiated a deal for the state, city, county and Wisconsin Center District to pay for the other half of the cost, but the Republican-controlled state Legislature has balked at approving the deal.
If approved, construction for the arena could begin by the end of the year. The Bucks owners also want to build at least $400 million in ancillary development, including a practice facility, around the arena. That development would fill in the vacant portion of the Park East corridor west of the Milwaukee River in downtown Milwaukee.
