Last updated on March 17th, 2020 at 01:32 pm
Brookfield-based Milwaukee Electric Tool Corp.’s massive campus project in Menomonee Falls will likely receive considerable assistance from the village, in addition to the $20 million tax incentives from the state.
Company officials on Tuesday evening revealed details of the $100 million multi-purpose campus development, which may eventually reach up to 2.5 million square feet in size. It would be developed in the Woodland Prime office park, which is located north of where Flint Drive meets Good Hope Road.
The project will likely receive village assistance through tax incremental financing. The company will also pay $1 for the development land currently owned by the village.
The Menomonee Falls Village Board is scheduled to meet on Thursday evening to approve a developer’s agreement on the project, village manager Mark Fitzgerald said.
Village trustees will consider a pay-as-you-go, or PAYGO, agreement that would return to the company 70% of tax increment generated by the project annually, he said. This agreement would last through 2037, which is the remaining life of an existing tax incremental district, or TID, that encompasses the site.
The total dollar figure of that tax incentive “is all going to depend on how much they build,” Fitzgerald said.
In turn, the village will see the redevelopment of 65 acres of largely vacant land and the addition of 770 new workers at the corporate park.
Kharli Tyler, a Milwaukee Tool spokeswoman, said in an email that the multi-purpose campus will be “an expansion of activities that take place at the Brookfield headquarters, which is the global (research and development) headquarters of the company.”
Since plans are in the early stages, Tyler declined to provide details on how many buildings would be constructed in Menomonee Falls.
“The site will allow the company to expand to support Milwaukee’s future growth across the globe,” she wrote.
Milwaukee Tool currently employs more than 1,400 people at its Brookfield headquarters campus.
Milwaukee Tool will at least initially develop the Menomonee Falls campus over three phases, with more development possible in the future, Fitzgerald said.
“For the first three phases, those are pretty well a lock, and that’s about $100 million,” said Fitzgerald. “But then after that, they will build as the company needs to, and the PAYGO TID will continue to accrue through the life of the district.”
The $1 land sale also amounts to an incentive, as the company is getting it for far less than its actual value.
“The book value (of the land) is $3.7 million,” Fitzgerald said.
Phase one of the project involves the renovation of a 52,000-square-foot office building at W127 N7564 Flint Drive, which the company acquired this year. That phase won’t receive any incentives, as it won’t generate additional incremental value, said Fitzgerald.
Phase two, meanwhile consists of a new 120,000-square-foot office building that will be built on a 14-acre site to the east of the existing building. The site is currently owned by an affiliate of Milwaukee-based Zilber Ltd. Phase three will be developed on a large portion of a large village-owned site to the northwest of Flint Drive. Tyler confirmed the company will close on the acquisition of both sites on Friday.
The company will begin occupying the existing building in winter 2020, and will occupy the planned 120,000-square-foot building in the fourth quarter of 2020, she said.
The village also plans to extend Flint Drive northward until it meets Fond du Lac Avenue. This will provide another access point to the corporate park. Fitzgerald said the village will use TID funds for the $7 million project.
Milwaukee Tool’s Menomonee Falls development, as well as a planned $7.5 million expansion project in Sun Prairie, is expected to result in 870 new jobs. The company is receiving $20 million in tax credits from the Wisconsin Economic Development Corp. in exchange for those new jobs.
While 770 jobs will be added in Menomonee Falls, the other 100 jobs would be located in Sun Prairie.
The WEDC incentives are part of an existing contract that dates back to 2016. WEDC amended the contract this year to add this newest tax-credit incentive. In all, Milwaukee Tool is promising 1,812 jobs under its contract with WEDC. The state is offering a total of $48 million in incentives across two contracts.