South Milwaukee contemplates future of Caterpillar property

Caterpillar’s facility on Milwaukee Avenue in

In early May, the South Milwaukee common council unanimously adopted a comprehensive downtown plan focusing on the 900 and 1000 blocks of Milwaukee Avenue – the city’s main commercial district.

South Milwaukee Mayor Erik Brooks is hoping to breathe new life into the struggling downtown storefronts, and also offer support to the new businesses that have recently arrived.

Caterpillar’s mining equipment division headquarters is on Milwaukee Avenue in South Milwaukee.
Caterpillar’s mining equipment division headquarters is on Milwaukee Avenue in South Milwaukee.

He’s also not ignoring the 76-acre elephant in the room.

The entrance to Caterpillar Inc.’s South Milwaukee facility sits at 1100 Milwaukee Ave., adjacent to the city’s downtown. The mining company, which once employed 10 percent of the city’s population, is tightly nestled between Milwaukee, 10th and Rawson avenues, stretching three long blocks from east to west and six blocks north to south in the heart of the city.

Last month, Caterpillar announced to employees it would centralize its surface mining and technology division in Tucson, Ariz. and move 200 jobs out of South Milwaukee over the next five to seven years, with the majority of the work leaving in 2018.

South Milwaukee officials want to be prepared for whatever the future holds for the massive Caterpillar site.

“I hope we are positioning ourselves for when (mining) does turn around, Caterpillar will maintain a significant presence here,” Brooks said. “But short of us buying a dragline, I don’t think there is much we can do right now (to help the company). It’s a cyclical downturn in the mining industry globally.”

Caterpillar has 76 acres of land in South Milwaukee, taking up three city blocks from east to west and six from north to south.
Caterpillar has 76 acres of land in South Milwaukee, taking up three city blocks from east to west and six from north to south.

On the corner of 10th and Milwaukee is a tiny pocket park, Heritage Place, commemorating the city’s beginnings. There are two plaques, one detailing the city’s timeline and the other the history of Bucyrus.

Bucyrus Foundry and Manufacturing Co. moved from Bucyrus, Ohio to South Milwaukee in 1893 and the city, which was incorporated in 1897, grew up with it. 

“We became part of the fabric of Bucyrus and Bucyrus became part of the back story of South Milwaukee,” Brooks said. “We truly were a company town.”

When Peoria-based Caterpillar bought the company, then called Bucyrus International Inc., in 2011, Brooks anticipated a change. And when the mining industry as a whole took a hit, the changes became imminent.

The company has already consolidated operations on the South Milwaukee campus. Last year, Caterpillar combined operations from one of its 500,000-square-foot buildings into 250,000 square feet of space.

Brooks said Caterpillar has been investing in the space it retained. What is happening with the vacant space is unknown, and one of those buildings sits along the highly-traveled 10th Avenue, which is a prime spot for redevelopment, he said.

Of the 76 acres Caterpillar occupies, the company owns approximately 43.5 acres. The remaining 32.5 acres are owned by OLP JV Milwaukee LLC, which is registered to One Liberty Properties Inc., a real estate investment firm based in Great Neck, New York. 

The campus is split in two by Rawson Avenue, with the pieces referred to as “north of Rawson” and “south of Rawson.” Caterpillar 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.

There are two plaques in Heritage Place Park to commemorate the city of South Milwaukee and Bucyrus. Both grew up together beginning in the late 1800s.
There are two plaques in Heritage Place Park to commemorate the city of South Milwaukee and Bucyrus. Both grew up together beginning in the late 1800s.

On the “south of Rawson” side, the company owns five small parcels, all used for parking. All of the land is still under the ownership name Bucyrus International.

Brooks is hoping to meet with representatives from One Liberty Properties this month to find out their intentions for the property they own. Lawrence Ricketts, chief operating officer and executive vice president of One Liberty Properties, declined to comment.

Brooks said South Milwaukee has to contemplate life with a smaller Caterpillar.

“As much as we want Caterpillar here, and we want them to grow and succeed in South Milwaukee, we have to be realistic and face reality – they are moving jobs out of South Milwaukee, and that’s real,” Brooks said.

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