Ryan Companies U.S. Inc. plans to build a 230,000-square-foot industrial space development on a 23-acre site in Oak Creek and is seeking tax incremental financing assistance for the project from the city.
The site, located at 813 W. College Ave., is currently used for rock crushing by an excavating contractor, said John Dunneback, director of development for Ryan Cos.
Ryan is developing plans for a two-building industrial development on the site. Plans submitted for the site earlier this year showed a 159,840-square-foot building and a 70,200-square-foot building.
“We’re in the infancy stages of the project,” said Dunneback, who declined to comment on specifics of the project.
The project is currently speculative in nature, but some potential users are showing interest in the buildings, Dunneback said.
“There is interest currently in purchasing both buildings,” he said. “There’s a lot of activity, but we have yet to settle on anything yet. We are actively talking to multiple groups.”
Dunneback also declined to disclose the amount of TIF funds that Ryan Cos. is seeking for the project.
“We’re going through negotiations (with city officials),” he said.
According to a TIF application submitted by Ryan Cos. to the city for the project, the cost of the site is estimated at $1.5 million and the private development cost is estimated at $10 million, a total of $11.5 million. In addition, the cost of public improvements are estimated at about $4.5 million. The total value of the public and private improvements for the project is estimated at about $16 million.
Ryan Cos.’ TIF application said the justification for seeking the funds includes: “site geography is unsuitable for development and construction,” “lack of public utilites to proximity of site” and “geotechnical uncertainties will cause this site to not be developed in the foreseeable future.”
“There’s some subsurface issues,” Dunneback said. “There is definitely some work that needs to be done.”
Information submitted by Ryan Cos. earlier this year said the site requires nearly $2.24 million in “extraordinary costs” to prepare the site for development.
“This site has historically been used as a clean fill landfill site,” director of community Doug Seymour wrote in a city report this summer. “It’s development poses several challenges due to its topography, environmental restrictions and proximity to utilities. The scale and quality of the development at this location would be restricted if not for public sector assistance to assist with extraordinary development costs.”
The appeal of the site for industrial development is its proximity to I-94, Dunneback said.
“It’s less than half a mile to the interstate,” he said.
The southeastern Wisconsin industrial space vacancy rate has been on a steady decline since 2008 and was at 6.05 percent during the second quarter of 2014, according to Xceligent. The performance of the region’s industrial real estate market has prompted Ryan Cos. and other developers to work on plans for new buildings.