Four years ago, serial entrepreneur Jeffrey Koenig purchased a dilapidated historic warehouse in Milwaukee’s Haymarket Square neighborhood, which is just north of downtown and the Park East corridor.
The former William P. Froehlich Paper warehouse at 419 W. Vliet St. has extensive roof and water damage. But the cream city brick and original stone of the 133-year-old building caught Koenig’s eye.
[gallery type="slideshow" size="full" ids="446893,446894,446895,446896,446897"]
Koenig bought the 7,500-square-foot, three-story building for $75,000. At the time, he planned to move his business, The Sigma Commercial Companies, into the space.
Then in fall of 2015, the Milwaukee Bucks announced they would build a $500 million arena and entertainment district in the Park East corridor, less than two blocks from Koenig's building.
“I didn’t look at it like hitting the jackpot,” Koenig said. “But I knew my office would not be the highest and best use (for the building).”
Koenig tried for several years to sell the building, but multiple deals fell through because the buyers lacked financing. So, he has changed course.
“We call them dreamers in the industry, which is great, but you need a bank to give you a loan or be very wealthy,” Koenig said.
The 31-year-old developer is now planning to gray box the property for a potential tenant. Koenig is working with Milwaukee architectural firm Vavra Design LLC on the project.
Koenig is envisioning a speakeasy or wine bar in the lower level, a first-floor restaurant and second floor event space.
The third floor, which is currently completely destroyed by damage from the roof, will be converted to a roof-top bar and deck that will partially be covered with a pergola. Koenig wants to create something similar to the Kimpton Journeyman Hotel’s rooftop deck in the Historic Third Ward.
“The views from up there (the Vliet Street location) are amazing,” he said. “You can see the entire city and with our proximity to the arena, I really think this is an interesting opportunity.”
Koenig was a 20-year-old bartender at Cubanitas in downtown Milwaukee when he purchased his first rental property.
By the time he was 21, he was launching his company, and teaching himself to do manual labor and construction.
Today, The Sigma Commercial Companies is the parent company for J2 Builders, Labonte Construction, Property Prep, Vandelay Group and Wood Tool Supply.
“I’m not traditionally a commercial developer,” he said. “I’ve never developed a building on spec. Normally, a tenant would make me feel more comfortable. If someone makes me an offer before the construction is done, I would be happy to entertain it.”
Koening does not know the final cost of the project, but he is estimating it will be up to seven figures.
He will begin construction when he receives approval from the city. The Board of Zoning Appeals will review his application on July 26.
Once the project is complete, he said his property management company could rent it to a tenant, he would be happy to sell the building as an investment, or sell it to an owner occupant.
“I believe it will be easier for someone to obtain conventional financing once the heavy lifting is done and it will be a much more sellable asset when people can see the vision I have in my head,” Koenig said. “Right now, others may not be able to see it when they walk through a space with such a level of decay.”