Last updated on May 15th, 2019 at 04:47 pm
The city of Milwaukee may contribute $9 million toward the redevelopment of the former Shops of Grand Avenue mall through tax increment financing.
According to a public notice published Thursday, the Redevelopment Authority of the City of Milwaukee will hold a hearing during its March 21 meeting on the proposed TIF funds.
The $9 million developer-financed cash grant would assist the developers of The Avenue in transforming the former mall into a center with a mix of uses, including retail, a food hall, office space and apartments.
Specifically, the city funding would partially offset costs related to work on public access ways, plaza improvements and facade improvements related to the project, according to the TIF district project plan. The TIF funds would be paid to the developer as annual cash grants over a period not to exceed 18 years. The financing district will also pay $135,000 in administrative expenses.
Tony Janowiec, co-owner of The Avenue, said the money would largely go toward moving the existing second-floor public walkway to the first floor as well as the construction of a new public plaza at the intersection of North Old World Third Street and West Wisconsin Avenue.
“What’s unique about this property is the enormous amount of public space in this building,” Janowiec said.
For one, an existing public skyway connects the second floor of the Plankinton Arcade with the HUB640 office and retail building, also known as the former Boston Store building. Since the second floors are being converted to private offices, the public walkway will have to run through the first floors, said Janowiec.
Meanwhile, the redevelopment project also calls for the removal of both the large glass vestibule that served as the mall entrance and the former Applebee’s. At the site of the former restaurant will be a first-floor beer hall. Meanwhile, a new public plaza will be constructed where the glass entryway once existed.
“So, we’re building more public space than is currently in existence,” Janowiec said.
The mall property’s ownership group, which consists of Janowiec of Interstate Development Partners and Josh Krsnak of Hempel Companies, purchased the Grand Avenue in 2015 for $24.5 million. They later purchased other nearby buildings, including the Matthews Building at 301 W. Wisconsin Ave. and portions of the ASQ Center and its parking structure at 555 N. Plankinton Ave. Both the Matthews building and ASQ building have direct access to the former mall.
In December, the ownership group detailed their plans for The Avenue, which include 190,000 square feet of office space, the 21-tenant 3rd Street Market Hall and the 52-unit Plankinton Clover apartment complex. They also confirmed Milwaukee-based engineering firm GRAEF-USA Inc. would move its headquarters to the mall by late 2019. GRAEF would occupy 35,000 square feet on the building’s third floor.
The Grand Avenue mall opened in 1982 as part of a national trend of building shopping centers in urban downtowns, and featured the first Milwaukee locations for many national retailers, according to the TIF project plan documents. The construction of the mall connected and helped preserve the Gimbels and Marshall Field’s department store buildings, the Plankinton Arcade, the Matthews building and the Boston Store building.
By the mid-’90s, the mall began to struggle due to competition from suburban shopping malls. The city created a TIF district in 1998 that has contributed to a number of projects in the neighborhood, including the redevelopment of the Marshall Field’s/Gimbels building into the ASQ Center, the conversion of the Boston Store building into a mix of apartments, office and retail, providing incentives to keep the Bon-Ton headquarters in downtown Milwaukee and the redevelopment of the Grand Theater into the new home for the Milwaukee Symphony Orchestra. In all, the city has contributed more than $27.4 million through that TIF district to date.
Also, in 2001, another TIF district was created to provide $6 million for the redevelopment of the Plankinton Arcade into a TJ Maxx and Linens ‘n Things, along with related building improvements.
The 21 properties that would be part of the proposed TIF district for The Avenue are currently assessed at $36.4 million. All properties are also located in the two previously created districts.
The combined assessed value of the Plankinton Arcade, The Avenue and Matthews building is about $20.3 billion. Following the redevelopment of the three buildings, the city anticipates their assessed values will increase to a combined $56.6 million.