CRE Spotlight: Development ready to take off in Mt. Pleasant

It appears that Mt. Pleasant officials’ plans to attract development near Interstate 94 are finally about to pay off. Chicago-based HSA Commercial Inc. recently purchased 90 acres of farmland near I-94 in Mt. Pleasant. The property, located southwest of Highway 20 and County Highway V, is part of the new 950-acre Mount Pleasant International Commerce Center. Initially, HSA plans to build a 125,000-square-foot and a 300,000-square-foot speculative industrial building on its site. Construction is expected to break ground by the end of this year or early next year, said John Mangel, vice president of acquisition and development for HSA.

Eventually HSA plans to build five to 10 buildings on the 90 acre property, with small retail and office buildings along Highway 20 and larger warehouse/office buildings in the back of the property, Mangel said.

Mt. Pleasant has a population of about 26,000 and became incorporated as a village in 2003. In 2005, the village hired Chicago-based The Lakota Group Inc. to create a master plan for the 5,000-acre area roughly located between County Highway C and Highway 11, east of I-94. As part of an intergovernmental revenue sharing agreement with the City of Racine, sewer and water services were extended along Highway 20 to I-94 last year, for the first time making the area ready for commercial development. Racine and Mt. Pleasant each spent $3 million for the infrastructure. In addition, Mt. Pleasant has created a tax incremental financing district for a 488 acre area, which includes 380 acres of the International Commerce Center.

HSA’s project will be the first in this area as a result of all of that work.

“It is the first major development,” said Jim Henke, director of community development for Mt. Pleasant.

“It’s the reason we put millions of dollars into the ground,” said Village Administrator Michael Andreasen.

The village plans to use $5.8 million from the TIF district to extend County Highway V and extend water and sewer lines for the HSA development.

Within the 488-acre TIF district, HSA owns 90 acres, Brookfield-based NAI MLG Commerical owns 130 acres that it is marketing for development and Brookfield-based VK Development Corp. owns 90 acres, where it was planning a residential development before the housing market hit the skids. The rest of the land in the TIF district is owned by farmers.

The village’s master plan for the 5,000-acre I-94 area includes the 950 acre commerce center, single family and multi-family residential areas, a retail “town center” area and some office and hotel development.

“We’re trying to put more emphasis on attracting commercial development to the village,” Henke said. The village wants to attract the tax base, jobs and services that development will bring, he said.

The village hopes to take advantage of development pressure that is spreading north from the Chicago area, which has resulted in development in Kenosha County, and south from the Milwaukee area. Eventually that growth should hit Racine County and Mt. Pleasant is now ready to capture it.

“It’s the most logical progression of development,” Henke said. It will probably take about seven to 10 years to fully develop the TIF district, he said.

Mangel said he was surprised to discover that most of the interest in the Mt. Pleasant project from potential tenants is coming from Milwaukee area firms instead of from the Chicago area.

“We like the I-94 corridor,” he said. “It’s a good location for doing industrial development.”

HSA continues to increase its holdings in the area. The company is a full-service real estate firm specializing in office, industrial, retail and health care real estate leasing, management, marketing, development and financing on a national basis. The company owns more than 17 million square feet of commercial property in 14 states.

The company has been expanding its portfolio in southeastern Wisconsin in recent years. HSA entered the market by acquiring the 195,000-square-foot Olson Cos. Inc. industrial plant in Glendale at 4200 N. Port Washington Road in 2003 in a $5 million sale/leaseback transaction. In 2004 the company purchased the 717,717-square-foot Brown Deer Business Park for $28 million.

Earlier this year, HSA acquired the “Burleigh Triangle” in Wauwatosa by purchasing the former Kohl’s Food Stores warehouses at 11100-310 W. Burleigh St. on 24 acres for $9 million and the former Roundy’s Supermarkets properties at 11300-500 W. Burleigh St. on 39 acres for $8.5 million. The company is planning a major redevelopment for the site. Wauwatosa officials want to see a dense, mixed-use development there.

Oconomowoc

Oconomowoc-based Frontier Development plans to redevelop the 11.5-acre former Summit School property located at the northeast corner of Highway 67 and Valley Road, just outside of the Pabst Farms development. Frontier plans to tear down the school building and plans to build five commercial buildings with a total of 125,083 square feet of space, about 60 percent of which will be office space and 40 percent will be retail space. The development will include a bank and restaurant in its first phase.

Frontier Development also plans to build a 15,864-square-foot multi-tenant office building, which would be called Parkway Place Office Center, on a vacant lot at 1080 Oconomowoc Parkway.

Brookfield

Paciugo Gelato, a Dallas-based chain of Italian ice cream parlors, plans to open a location in a small retail space at Brookfield Square Mall, between the Bravo! Cucina Italiana restaurant and the The Limited store. Paciugo Gelato has 19 locations in the U.S. and two in Mexico. The only Wisconsin location is on State Street in Madison. The company plans to open an additional 24 locations, including the Brookfield store.

Wauwatosa-based Irgens Development Partners LLC plans to build a 20,995-square-foot medical office building at 21800 Intertech Dr. in the Gateway West Commerce Center.

Wauwatosa

Naperville, Ill.-based OfficeMax Inc. plans to open a store in Wauwatosa. The office supplies retailer recently leased 20,000 square feet of space at the northeast corner of North 124th Street and Burleigh Street. The company has about 1,000 stores in the U.S.

Grafton

Dillon Group LLC plans to build a two-story, 5,600-square-foot office building at 1230 13th Ave. The building will be the final phase of the company’s Bridgewater/Brew Pub development.

Jim Carrier plans to open a Rapid Refill Ink store at 1359 Port Washington Road in November, and he plans to open 12 more locations in the next few years. The store will specialize in the remanufacturing/refilling and selling of inkjet and laser toner cartridges for printers, copiers, fax machines and all-in-one machines. The store will also sell specialty paper, bulk paper, printers and other related items.

Wales

Developers Peter Ogden, president of Ogden & Co Inc., and Roger Duchow, plan to build a 28,000-square-foot retail and office space development at Highway 18 and Highway 83. The tenants will include a Walgreens store, a bank and three restaurants.

Greenfield

Brookfield-based NAI MLG Commercial plans to build a 2,400-square-foot Cousins Subs restaurant on an outlot in front of the Aldi store at the northwest corner of Highway 100 and Cold Spring Road.

Racine

Racine officials recently hosted a ribbon cutting ceremony for the new Southside Industrial Park, located northwest of South Memorial Drive and De Koven Avenue. The industrial park has 11 acres of available land for development, which is priced at $35,000 per acre. Some incentives are also available from the Racine County Economic Development Corp. The industrial park also has a 56,000-square-foot centralized, shared parking area for the industrial park users.

Milwaukee

Stevens Point-based DigiCopy Inc. recently opened two more locations in Milwaukee, one at 222 Erie Street in the Third Ward and one in the U.S. Bank building at 777 E. Wisconsin Ave. The company says it plans to open more stores throughout the Milwaukee area. Its only other store in the area is at 1681 N. Van Buren St., Milwaukee.

Diana and Greg Hashek, Rich Pawlitzke and Don Mueller, the owners of the Indigo restaurant at 5921 W. Vliet St. in the Washington Heights neighborhood, recently sold the restaurant to Jan Kelley, who has renamed it Meritage.

Commercial Real Estate Transactions