Hales Corners developer Wimmer Communities is planning to build two apartment communities in Brookfield – one north of Brookfield Square, one south of the mall.
When the developments are finished, nearly 300 units will be added to Brookfield, which city officials say still isn’t nearly enough. In fact, a study released in January found up to 700 new apartments would be needed in Brookfield within five years.
Much attention has been paid to downtown Milwaukee’s apartment development boom, but the inner-ring suburbs and beyond have also seen the same demand, which is driving an uptick in suburban apartment development.
Baby boomers who are ready to downsize but do not want to leave the suburban communities in which they raised their families are looking for high-quality rental options, and millennials who work in the suburbs are also looking for dwelling options close to the office.
“This is really part of the evolution of the suburbs,” said Dan Ertl, Brookfield’s director of community development. “Most of us start out converting agriculture to single-family subdivisions. Then we follow with retail and some industrial. Apartments were not an early part of the formation of the suburbs. Now that we’ve been incorporated for 62 years, we’ve come to the full evolution.”
Brookfield currently has 1,200 apartments. A report presented by a consultant to the city’s plan commission in January showed the total demand for apartment housing was 500 to 700 units over the next five years. Estimated future supply is 400 units.
Ertl believes three groups will fill the apartments planned in Brookfield: Empty nesters who want an option other than Florida or Arizona; people whose family situation has changed and they are either suddenly single or need to rent; and people with the means to have a home in a warmer climate and an apartment in Brookfield.
Prior to the Great Recession, home ownership saw historic highs between 64 and 70 percent. Today, it is down to 60 percent, as preferences have changed, said Blair Williams, president of Milwaukee-based WiRED Properties, which specializes in mixed-use suburban apartment developments.
“People learned a hard lesson about owning real estate after the Great Recession,” Williams said. “We’re not building for millennials. Boomers have an increasing propensity to rent.”
Williams was the developer behind Mequon Town Center, a mixed-use development that includes 40 apartments. He has also developed apartment buildings on both sides of Oakland Avenue in Shorewood and is part of the team proposing the mixed-use Ballpark Commons project in Franklin, which includes 300 apartments.
WiRED also is the developer of the Main Street portion of Drexel Town Square in Oak Creek, which includes 62 luxury apartments and more than 33,000 square feet of retail space. In addition to Williams’ apartments at Drexel Town Square, a 510-unit luxury apartment development is being built there by Barrett Lo Visionary Development.
Mixed-used suburban projects like Drexel Town Square and Mequon Town Center create environments similar to downtown areas or urban neighborhoods and are approached by developers and civic leaders with a “circle of life” mentality. Empty nesters are attracted to the apartments because they can stay close to their grown children, their friends and their places of worship but no longer have to worry about their large homes, yards and tax bills. Young families from the city can move to the suburbs and into the homes being vacated by older generations.
Millennials that like to live in a pedestrian-oriented environment are also being catered to by these mixed-use suburban developments – all of their needs are within walking distance: restaurants, dry cleaning, shopping. And of course, when they are ready to start a family, look no further: an empty nester has just put his or her house on the market.
“We think our role of apartments in the suburban community is to create market churn,” Williams said. “To compete with a neighboring municipality, you identify your competitive advantage. And one thing you know is millennials have urban preferences, but the reality is, you go to the suburbs for the schools once you want to grow a family. We believe by urbanizing the suburbs, you can attract more people.”
The formula appears to be working.
Wangard Partners has proposed 182 units of townhomes and apartments in Elm Grove. Wangard is also building The Reef, a 180-unit multifamily housing development in Wauwatosa. In Oconomowoc, the Wauwatosa-based developer is working on phase two of The Preserve at Prairie Creek, which will include 160 units. Phase one, which is 228 units, is already fully leased.
Milwaukee-based Mandel Group, which has focused on apartment development since the Great Recession, has about a dozen apartment developments in the suburbs. Robert Monnat, partner and chief operating officer of Mandel Group, said there is demand for the units from both millennials and baby boomers.
Millennials are attracted to suburban living for a number of reasons, Monnat said. In many cases, they cannot afford to live downtown, where rents are $2 a square foot, compared to $1.50 to $1.75 in the suburbs.
“Milwaukee is also one of the few areas of the country where job growth is not limited to the central business district and is still occurring in the suburbs,” Monnat said. “There are still desirable employment options in the suburbs.”
Older baby boomers who have retired also desire to live in high-end luxury apartments, Monnat said. Mandel Group has built apartment complexes in Shorewood and Whitefish Bay that have catered almost exclusively to this group and is planning a similar community in Fox Point. Monnat said while concrete plans on the Fox Point development have not even been released, people are already asking to reserve their space in the community.
“Active seniors are not moving into senior housing developments until a much older age, so this fills the gap between single-family housing and senior housing,” Monnat said.
There was a time, he said, when Mandel Group was the only developer in a municipality building apartments. Now, two or three developers have projects going because the demographics have changed.
Condominiums are no longer being built and single-family housing is not a priority for many individuals. Despite the increased competition, Monnat is confident the new apartment units being built—both in the suburbs and in downtown Milwaukee—will be leased.
“I’m not a bit worried,” he said.
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