Schlitz Park developer Gary Grunau recently announced plans for a $76 million, multi-phase, mixed-use expansion he says will add 290,000 square feet of office space, a 142-room hotel and 140 apartments to the complex just north of downtown Milwaukee over the next five years.
The first phase of the Schlitz Park expansion will be a conversion of 50,000 square feet of warehouse space, formerly occupied by Assurant Health, in the Schlitz Park Rivercenter building into office space. The second phase would convert some existing space and add a four-story addition to the Powerhouse building, which would create an additional 80,000 square feet of office space. Schlitz Park also plans to build a four-story, 160,000-square-foot office space expansion on top of the four-story Rivercenter building, add a hotel along the Milwaukee River between the ManpowerGroup corporate headquarters and the Time Warner Cable building, and develop apartments on a vacant site north of Pleasant Street between North First and Second streets.
The Schlitz Park plans add momentum to one of the hottest development areas in the region. Just east of Schlitz Park, on the other side of the Milwaukee River, is the North Water Street corridor, which is booming with new apartment developments. Just to the southwest of Schlitz Park is where the new $500 million arena is planned for the Milwaukee Bucks. The owners of the Bucks also plan to build an additional $500 million in ancillary development around the arena.
The plans for the arena, and a possible extension of the downtown Milwaukee streetcar project north along Dr. Martin Luther King Jr. Drive, is leading to increased interest in potential tenants for Schlitz Park’s office space, Grunau said.
“The arena and the streetcar are going to be tremendous attributes (for Schlitz Park’s expansion plans),” he said.
Grunau isn’t the only developer with eyes on the arena project. WiRED Properties and Phelan Development plan to convert the National Ace Hardware property at 1303 N. Fourth St. into a “community based retail and office redevelopment.” WiRED and Phelan recently purchased the National Ace Hardware property, which consists of three buildings built between 1892 and 1910. They plan to do a complete historic restoration to create 40,000 to 50,000 square feet of office space and 10,000 to 20,000 square feet of retail space.
The National Ace Hardware property is about two blocks away from the Schlitz Park complex, only a block north of the planned arena site and just north of the Park East corridor, where much of the ancillary development planned by the Bucks owners would be built.
“The arena district is an extremely high level amenity for our tenants,” said Blair Williams, president of WiRED Properties.
Across the river from Schlitz Park, Wangard Partners Inc. has a contract to purchase the former Laacke & Joys property at 1433 N. Water St. and is working on a redevelopment project for the site, said Stewart Wangard, chairman and chief executive officer. The redevelopment project could include office, retail and restaurant space, he said. The company is marketing the property to potential tenants.
The first priority of the project is to restore the historic former Laacke & Joys building, a four-story 64,826-square-foot, 141-year-old structure. Wangard said his firm is in talks with multiple potential tenants for the building.
The Wangard project at the site could also include new buildings on either side of the former Laacke & Joys building. A warehouse northeast of the building will be demolished to create a site that could accommodate a 200,000-square-foot building, Wangard said. The 6,000-square-foot Peck garage located to the southwest of the former Laacke & Joys building could be converted to a restaurant. Otherwise, the Peck garage building could be demolished and a high rise, with perhaps 200,000 to 400,000 square feet of space, could be built on the site, Wangard said.
The arena and other nearby projects have increased the interest in potential tenants for the Laacke & Joys site, Wangard said.
“Milwaukee is on a roll,” he said. “A lot of office users are considering downtown. There is momentum building.”
Grunau agrees. Betting on national trends of more people and businesses moving to downtown areas, The Brewery Works Inc., which owns Schlitz Park, invested $62 million in improvements to the 46-acre Schlitz Park campus from 2011-’14 and increased the occupancy of its 1.2 million square feet of space from 67 percent in 2010 to 98 percent in 2015. Grunau expects the trend of businesses moving downtown to continue, and said Schlitz Park needs to provide more office space to accommodate those tenants.
“Someone has to provide the office space for the jobs,” he said.
More office space in the area could be provided by Brookfield-based Hammes Companies, which is planning an office building development at Knapp and Water streets. The company is considering plans to move its headquarters to the development.
Across the Milwaukee River from Schlitz Park, the North Water Street corridor is one of the hottest spots for apartment development in the downtown area as more young professionals and empty nesters continue to move downtown. At Water and Pleasant streets, Mandel Group is building the third phase of its North End development, which will add another 168 apartment units and a Fresh Thyme Farmers Market store. Later, Mandel Group will build the fourth phase of the North End, which will have another 250 to 260 apartments.
Tim Gokhman and Jim Wiechmann are building Rhythm, a seven-story 140-unit apartment building at 1632-40 N. Water St.
Atlanta-based Atlantic Realty Partners plans to build the River House development, a four-building, 443-unit luxury apartment development on the former Gallun Tannery site on the east side of the Milwaukee River, the west side of North Water Street and north of Holton Street.
Wangard plans to construct a two-building development along the Milwaukee River, at Brady and Water streets, with 160 to 200 apartments and up to 12,000 square feet of retail space. Wangard also plans to build additional phases to its Avenir apartment development on the block bounded by Broadway, Ogden Avenue, Lyon Street and Jackson Street.
Rick Wiegand plans to transform the 123-year-old former F. Mayer Boot and Shoe Co. building at 100 E. Pleasant St., just north of Schlitz Park, into a 176-unit apartment building.
It remains to be seen if there is enough demand to support all of these developments and whether or not they will all get built. But this area is clearly one of the hottest for development downtown.
“We’re not going to wait,” Grunau said. “Our city is becoming very vibrant. Milwaukee is on a roll right now. We want to keep it going. Obviously, as a developer you want to take advantage.”
