Last updated on July 2nd, 2019 at 09:12 pm
The owners of 430 acres of land in Caledonia, which includes South Hills Country Club, are counting on the Foxconn effect to dramatically increase the value of their property.
Hintz Holdings LLC has listed its land, located just south of Golf Road, between I-94 and Highway V, for $32 million.
That’s $74,419 per acre, about $11,000 more than the $63,433 per acre Foxconn Technology Group’s developer agreement estimates it will cost to acquire the land necessary to build its mega manufacturing facility in Mount Pleasant.
Dan Hintz purchased the Caledonia site in 2008, anticipating the I-94 corridor from Milwaukee County to the state line would eventually attract development.
He was right. Over the past five years, momentum along the I-94 north-south corridor has taken off, with companies including Uline Inc. and Amazon.com Inc. moving into Wisconsin and creating hundreds of jobs.
In October, Foxconn announced it would build its $10 billion manufacturing plant just east of I-94, between Braun Road and Highway KR in Mount Pleasant, about three miles south of Hintz’s land.
The Hintz family has considered selling in the past.
In 2013, the property, which includes one mile of frontage along I-94, was listed for $30,000 an acre.
“Our decision to actively market once again and our new valuation is not based entirely upon the Foxconn development. However, we do feel that it certainly adds to the assessment of an already unique piece of property with valuable extensive interstate exposure,” said Alex Hintz, managing member of Hintz Holdings and Dan’s son.
The Hintzs have been operating South Hills Country Club for almost as long as they’ve owned the property. The original tenant went out of business and Dan Hintz purchased the equipment and assumed ownership.
“We will be open in spring 2018 and expect to continue until we have a signed offer on the land,” Alex said.
The Hintzs are marketing the property themselves, with Alex taking the lead. He said there have been interested parties.
Certain sites near the Foxconn development have been targeted by developers. Northbrook, Illinois-based Stack Real Estate LLC, led by Jeffrey Rothbart, has three sites in Mount Pleasant and Sturtevant totaling 220 acres under contract to purchase.
Rothbart did not disclose how much he is planning to pay per acre when he closes on the land within the next 18 months.
Rothbart’s sites, however, have water and sewer connections. The parcel the Hintz family is marketing does not. But Alex said the infrastructure is on Highway K, and a developer could easily hook up to the utilities.
“We didn’t pursue it because we are not developing the land,” he said.
Jim Barry III, president of Milwaukee-based commercial real estate firm The Barry Co., said the Foxconn effect has ramped up interest from both buyers and landowners along the I-94 north-south corridor.
“I met with someone last week interested in investing along the corridor, which is definitely a hot commodity right now and being looked at seriously for future opportunities,” Barry said. “Land value is supposed to move from the lower end, which is agricultural, to the higher commercial use, and that is the direction it is headed.”
Jeff Hoffman, a partner with Cushman & Wakefield | The Boerke Co., said people in Wisconsin are not used to hearing about $10 billion developments with 13,000 employees, and what that could mean for a region. Some landowners might have unrealistic expectations of the impact of the Foxconn project, he said.
“I think for local property owners, they are seeing this as the next gold rush and it is very exciting,” Hoffman said. “But based on how these mega campuses develop, it is not reality.”
Hoffman, who specializes in industrial real estate and has focused on the I-94 north-south corridor, said the challenge for landowners there who want to sell is that there is a lot of land available, and most of the actual development will be taking place on Foxconn’s site.
The first phase of Foxconn Technology Group’s LCD campus in Mount Pleasant could include five buildings with a footprint of at least 500,000 square feet, including two that would exceed 1.5 million square feet, according to the latest plans submitted to the village.
Phase two could include another five facilities exceeding 400,000 square feet.
Hoffman said the Foxconn project will be transformational – but mostly for Foxconn. Residential and retail development will follow, but the industrial development will primarily be on the Foxconn site itself, he said.
“It’s not like this is being built in the middle of downtown Milwaukee or Chicago,” Hoffman said. “You can go from Oak Creek to Kenosha and there has been a lot of development, but there are still a lot of open farm fields that can be developed. Land is not an issue.”