The Milwaukee Department of City Development made waves in July when it picked a stunning redevelopment project for the Marcus Performing Arts Center parking structure site downtown.
The $700 million proposal includes 750 apartments, 190,000 square feet of office space, 40,000 square feet of retail space and a 300-room hotel. It would consist of several towers, including a 55-story structure that would be the tallest building in the state.
It’s an incredibly ambitious project for Milwaukee, and the development firm proposing it, Madison-based Neutral, has a limited track record.
The city has never had a development on this scale. But, a lot of concerns have risen that have stalled the project at City Hall.
Tim Gokhman, managing director of New Land Enterprises, one of the other two firms that responded to the RFP for the site, made public his dissatisfaction with the process, criticized DCD, and the company dropped out of the competition.
New Land has a lengthy portfolio of development projects in Milwaukee. Its proposal for the Marcus Center parking structure site was massive: a $350 million mixed-use development, but the project pitched by Neutral is much bigger and won over DCD.
DCD wants to provide Neutral a one-year exclusive right to negotiate a purchase of the site from the city. But that requires approval from the Common Council and some aldermen are balking.
There are legitimate concerns. Gokhman’s complaints about the RFP process is a big red flag and why weren’t there more proposals? Neutral’s project is so ambitious, it’s hard to believe it’s feasible in Milwaukee. And Neutral lacks the track record to indicate it can pull this off.
Ald. Robert Bauman wants the city to do a feasibility study on the project and suggests DCD re-do the RFP.
DCD could use the one-year negotiating process to study the feasibility of the project. It’s certainly worth examining if the downtown housing market has enough demand for this, and where are the office tenants going to come from?
Neutral also plans to build a 32-story, 383-unit apartment tower next to the Marcus Center parking structure site. It sure would help to get that project financed and under construction first to prove to naysayers that the firm can get a major development built.
The Marcus Center parking structure situation reminds me of The Couture project. A prime location owned by the government not putting it to its highest and best use, an RFP seeking development proposals, a flashy project picked by a developer with a limited track record over less ambitious projects from more established developers.
It took 12 years of struggle, but The Couture eventually got built.
The city should give Neutral a chance. It’s going to take time and a city subsidy (TIF), but the project would be transformational for downtown if successful. It’s worth a shot.
