Last updated on May 15th, 2019 at 04:51 pm
A New York-based company specializing in acquiring closed factories and redeveloping them has a large portion of the Caterpillar campus in South Milwaukee under contract to purchase.
Reich Brothers Holdings, LLC plans to buy the 32.5-acre site, the southern portion of the Caterpillar campus in South Milwaukee, from Great Neck, New York-based One Liberty Properties Inc. for an undisclosed price within the next few weeks, said Michael Reich, vice president and director of acquisitions and business development.
The property, which is listed for $15 million, includes eight buildings with 519,712 square feet of industrial space and 230,000 square feet of office space.
Reich Brothers Holdings and Rabin Worldwide purchased the former Oscar Mayer complex in Madison last fall. Reich Brothers is managing the building, which includes 280,000 square feet of office space. The group recently leased 13,000 square feet to Total Administrative Services Corp., an 80-person benefits administration company that signed a one-year lease at the former Oscar Mayer plant.
Michael Reich said the Caterpillar property in South Milwaukee is similar to the former Oscar Mayer complex in Madison in the sense that it is a shuttered manufacturing plant that needs to be repurposed. But, Reich said the future of the South Milwaukee complex remains fluid.
“There are a lot of components to (the Caterpillar site),” Reich said. “We will release more details after we close.”
The Caterpillar campus, located at 1100 Milwaukee Ave., once employed 10 percent of South Milwaukee’s population when it was home to mining equipment manufacturer Bucyrus International Inc.
Caterpillar acquired Bucyrus in 2011, and over the years has moved employees out of the heart of the city.
Of the 76 acres that Caterpillar occupies, the company still owns approximately 43.5 acres.
The campus is split in two by Rawson Avenue, with the pieces referred to as “north of Rawson” and “south of Rawson.” Caterpillar still owns two properties “north of Rawson,” a 36.6-acre parcel at 1118 Rawson Ave. and a 2.2-acre parcel at 1100 Rawson Ave. that contains an office building and many of the original Bucyrus buildings.
In January, Caterpillar notified its South Milwaukee employees it would consolidate all operations to the north of Rawson at Caterpillar-owned property by the end of 2018. Last month, a Caterpillar spokeswoman confirmed that was still the plan.
“The company does not expect this consolidation to impact employment at this time,” the spokeswoman said.
South Milwaukee Mayor Erik Brooks and the city council have been working since 2016 to come up with a plan for the future of the Caterpillar site and its surrounding area. Once Reich Brothers purchases the property, $75,000 from the Bucyrus Foundation can be used to develop a master plan for the campus.
On June 25, the city plan commission will hold a public hearing and consider $4.5 million in public financing that would cover 59 acres including the Caterpillar campus and portions of downtown South Milwaukee along Milwaukee Avenue and the Chicago Avenue Corridor.
The sites include an abandoned gas station, a vehicle storage facility, the city’s former water tower site and the former Bucyrus Club building that was once used as South Milwaukee’s community center and was most recently home to Papa Luigi’s Pizza restaurant, Brooks said.
The proposed tax incremental district comes at a time when South Milwaukee has an important redevelopment opportunity ahead of it in the heart of the city, Brooks said. The map for the district was drawn to effect as much change as possible, Brooks said.
“We met with the prospective new owner (Reich Brothers) several weeks ago and are really excited about the possibilities,” Brooks said. “We want the new owner to be an active re-developer who will work at bringing new life, and in this case, reinventing this property.”