Private colleges provide boost for struggling real estate market

The high unemployment rate, at 8.3 percent in Wisconsin, has resulted in an increased demand for colleges as workers seek new skills to compete in the job market.

At the same time, rising commercial real estate vacancies during the Great Recession has provided affordable opportunities for colleges to add additional campus locations.

“This has been the most active area in local real estate,” said Stephen Provancher principal of Brookfield based-NAI MLG Commercial. “This market brings another type of tenant that (building owners) wouldn’t have seen in previous years. I see this trend with higher education continuing throughout 2010, and there is no reason for it to slow down. (The schools) are taking advantage of the market to convert to their use.”
In the last six months, five for-profit colleges have leased space in the Milwaukee area, including: a Herzing University Brookfield campus in Brookfield; an Everest College campus in downtown Milwaukee; an expansion of ITT Technical Institute into the Morgan Office Park in Milwaukee; and University of Phoenix and Bryant & Stratton College both adding locations in Bayshore Town Center in Glendale.
“We have seen this type of interest in expansion due to unemployment and universities and training schools retooling and getting more student interest in programs,” Provancher said. “The trend has been vacant buildings for lease or for sale, but recently the majority of the properties on the market have been for lease across the board. A lot of the buildings are looking for tenants because theirs have moved out.”
Herzing University Brookfield opened a new 15,000-square-foot campus March 1 at 555 S. Executive Drive, west of Brookfield Square Mall in the Executive Drive Office Park. Six months earlier, Herzing University Kenosha opened a 14,000-square-foot campus in a former Aurora Health Care building.
Herzing University is the third institution to open a location in the Executive Drive Office Park, joining Ottawa University and Cardinal Stritch University.
Bryant & Stratton College opened a new 37,000-square-foot campus at Bayshore Towne Center in Glendale last September. The new Bayshore campus is the third to open in the Milwaukee area since 2001.
Bryant & Stratton is considering plans to open more campuses in the Milwaukee area.
“(Bryant & Stratton) is looking to expand its operation to support our technology and health care programs,” said Pete Pavone, director of Bryant & Stratton Milwaukee Colleges. “To that end, we are examining the need for more classrooms and student services for the fall 2010 enrollment. As the college adds new bachelor programs, any expansions will be directed toward locations where there is a high demand as we continue to meet our 92 percent placement rate.”
Last May, Cardinal Stritch University opened a new 24,000-square-foot campus in the former laboratory building at The Brewery redevelopment, the former site of the Pabst Brewery in downtown Milwaukee.
Everest College, owned by Santa Ana, Calif.-based Corinthians College Inc., will be the anchor tenant for the five-acre, $16 million Haymarket Square redevelopment project at the northwest corner of 6th Street and McKinley Avenue along the Park East corridor in downtown Milwaukee.
ITT Technical Institute recently leased 11,015 square feet in the Morgan Office Park at 6817 W. Morgan Ave., Milwaukee. The space had been vacant for about two years.
“Morgan has a tremendous amount of parking as well as being on a bus line which are big factors for educational centers,” said Provancher, who brokered the lease.
Last December, Ottawa University leased a 16,000- square-foot space in the Oak Creek Community Center, at 8580 S. Howell Ave. Ottawa University also has a campus in Brookfield.
The University of Phoenix opened a 1,800-square-foot Glendale Learning Center in the Bayshore Town Center last year. The University of Phoenix also has a location in Brookfield.
Kaplan Higher Education last year opened a Kaplan University Learning Center at 201 W. Wisconsin Ave. in downtown Milwaukee. Kaplan also has a Kaplan College campus in a 27,907 square-foot-campus space in the Schlitz Park complex.
Concordia University Wisconsin is consolidating operations at two campuses into a new location in the Village of West Milwaukee. Concordia, which just doubled the size of its Appleton Center and tripled the size of its Kenosha Center, plans to open a new 8,000-square-foot Milwaukee South Center at 1670 S. Miller Park Way in March.
Concordia will close its existing Milwaukee South Center at 1127 S. 35th St. and its Hales Corners Center at 5301 S. 108th St., consolidating those locations into the new West Milwaukee campus.
After the consolidation Concordia will have 16 centers.
“We have been expanding our strongest locations and minimizing less busy locations,” said Dr. Michael Besch, vice president of academic operations at Concordia University Wisconsin.

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