Northridge owners contemplating lawsuit following panel’s upholding of raze orders

Mall closed 16 years ago

The former Northridge Mall on Milwaukee's northwest side.

Last updated on July 22nd, 2019 at 01:04 pm

The owners of the former Northridge Mall on Milwaukee’s far northwest side are likely to take the city to court after a commission found that orders to raze the mall property were reasonable.

Convening on Thursday afternoon, Milwaukee’s Standards and Appeals Commission sided with the city, which mandated that the mall buildings be demolished. Following the meeting, representatives of the property’s owner, China-based U.S. Black Spruce Enterprise Group Inc., said they would likely further appeal the matter in circuit court.

“Black Spruce wants to be a team player with the city, it’s just disappointing the city doesn’t want to seem to participate in any sort of further discussions and they remain committed to tearing it down,” Eric Hatchell, an attorney representing the ownership group, told reporters. “So, we’ll let the legal process play out, and we’ll continue from here.”

When asked if the city could expect a lawsuit to be filed, Hatchell replied, “we’re going to analyze our options.”

Milwaukee officials announced in April they were issuing the raze orders after city inspectors determined the costs to adequately restore the buildings would be far greater than 50% of their assessed value. This is the threshold at which the city has authority to order a property be demolished.

Black Spruce said in May it planned to appeal the raze order.

Separate raze orders were issued for three different addresses that make up the mall property: 8221 W. Northridge Mall Road, 9009 N. Granville Station Road and 9109 N. Granville Station Road.

Officials with Milwaukee’s Department of Neighborhood Services said the assessed values for two of the addresses were $100, while 9009 N. Granville Road is assessed at $81,100.

“We Energies recently disconnected all three of their buildings from their service,” Chris Kraco, supervisor with Milwaukee’s condemnation section, said. “So, a part of the cost to move forward would be restoring that service with We Energies. And unlike a house, it’s not just a simple line drop. You’re talking about transformers, substations, submitting a rather large plan. That cost alone would probably exceed half of the assessed value of (the property).”

Hatchell and Li Yang, executive director of Black Spruce, tried arguing the city’s valuation of the property was too low. After a lengthy discussion, commission members said they were not the appropriate group to determine appropriate assessment values. They would only judge as valid the city’s claims the property was in such disrepair that its raze orders were warranted.

Yang also asked for more time from the commission, which would allow consultants to finalize expected redevelopment costs of the property.

Black Spruce this May revealed some preliminary plans to redevelop the mall property into an Asian marketplace. Yang said the plan includes bringing Asian-based manufacturers’ products to the mall both for wholesale and retail purposes.

“We are doing kind of a platform for them,” she said.

Nicole Larsen, assistant city attorney, said that from what she and other city officials could tell, the renderings were identical to what the group had provided the city about two years ago.

“They approached city administration, there was communication with the alderwoman of the district (the property is in), and they said, ‘Look what we’re going to do,'” Larsen said. “And from what I understand from speaking with those individuals, is that it’s the same plans we saw here presented today, the same two-year-old drawings are presented as, ‘Now, look at this brand-new development.’ Two years ago, city officials said, ‘O.K., bring something back,’ and guess who never brought anything back? It was Black Spruce.”

Located northwest of North 76th Street and West Brown Deer Road, the mall opened in 1972, but has largely sat vacant since the shopping center closed in 2003.

The property has been a target of break-ins and vandalism in the years since, Kraco said.

In 2013, Bill Penzey, owner of Penzeys Spices, attempted to buy the mall out of foreclosure, but that deal fell through when the owners paid off their delinquent bills. Penzey had intended to move his company’s corporate offices to that site and turn the area into a center for food retail, warehousing and distribution.

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Alex Zank
Alex Zank covers commercial and residential real estate for BizTimes. Alex previously worked for Farm Equipment magazine and also covered statewide construction news at The Daily Reporter. He graduated from the University of Wisconsin-Eau Claire, where he studied journalism, political science and economics. Having grown up in rural western Wisconsin, Alex loves all things outdoors, including camping, hiking, four-wheeling and hunting.