The wrecking ball tolls…

Last updated on May 13th, 2019 at 02:33 pm

As plans inch forward to redevelop two of downtown Milwaukee’s biggest eyesores, the former Pabst Brewery complex and the Park East freeway corridor, city officials, commercial Realtors and developers are discreetly pondering better uses for several other underperforming downtown properties.
Some backroom discussions are focusing on the Bank One office building’s parking garage, located at the corner of Water Street and Michigan Street. One developer has floated the idea of redeveloping the parking garage site into a mixed-use project that would take advantage of its location along the Milwaukee River.
Others are looking at the U.S. Cellular Arena, suggesting that it should be demolished to make room for a new downtown hotel or casino.
The Bank One parking garage and the U.S. Cellular Arena were identified as two of downtown Milwaukee’s most underperforming properties, according to a recent survey of Milwaukee commercial real estate experts and other downtown businesspeople (see accompanying graphics).
The unscientific survey was conducted by Small Business Times, which asked respondents to identify the most prominent underperforming downtown Milwaukee commercial real estate sites they would like to see meet the wrecking ball or be renovated for greater uses.
Fearing that they would offend landlords or would otherwise make political enemies, most respondents to the survey asked not to be identified for this report.
However, most of the respondents quickly and passionately identified properties they believe could and should meet the wrecking ball or be renovated for greater uses.
Blighted or underperforming properties create gaps between well-used properties, diminishing the synergy of downtown and impeding the city’s progress, according to many involved in the local commercial real estate scene.
“Milwaukee doesn’t really have a high concentration of anything,” said Steven Chamberlin, president of Milwaukee-based C.G. Schmidt Inc. Construction. “Everything’s so spread out. You go to other cities, and people walk everywhere.”
The Bank One parking structure was identified as the most underperforming downtown site by many respondents to the survey.
“If I controlled the wrecking ball, that parking garage would be the first thing to go,” said one Realtor.
“(The Bank One parking
garage) is one of the worst buildings in Milwaukee from a street point of view,” said Milwaukee city planner Robert Greenstreet.
Milwaukee-based Williams Development Corp. is floating the idea of demolishing the Bank One parking garage and rebuilding it as part of a 25- to 30-story mixed-use building with office and residential space on the upper floors and some retail space on the ground floor.
“I think it’s an outstanding site for exactly that,” said one commercial Realtor.
“We are talking to the bank about it,” said Bill Ornstein, president of Williams Development Corp. “It hasn’t gotten very far. I don’t know that it’s going to get very far. It’s very complicated.”
Bank One, which owns the office building and the parking garage, was recently acquired by JP Morgan Chase. The bank has about 1,100 employees in the building and plans to maintain it as its Wisconsin headquarters said Mary Kay Bean, spokeswoman for Bank One and Chase.
Bean said she was unaware of any redevelopment plans for the parking garage. However, she said the company will consider any plans presented by developers for the site.
“We are open to the idea of redevelopment of that site,” she said. “But we need a guarantee of 750 parking spaces for our employees and tenants. We have to have parking as part of that package. We’re open. If someone would like to propose something, we’re more than willing to listen.”
Ornstein said finding a place for the workers in the Bank One building to park during a project to redevelop the parking garage is one of the issues complicating the proposal. In addition, mixed-use buildings are harder to design and obtain financing, but they are easier to fill, he said.
The Bank One office building eventually will be renamed, likely to Chase Plaza, Bean said. Bank One recently spent $14 million on interior upgrades and telecommunication capabilities in the building, which was constructed in 1961, Bean said. However, the building has struggled to compete with newer downtown office buildings for tenants. For example, the Whyte Hirschboeck Dudek law firm left the Bank One building to move into the new Cathedral Place building.
For years, officials with the Milwaukee Department of City Development have decried the Bank One parking garage as a dark and dank eyesore and a waste of prime real estate on the banks of the Milwaukee River.
However, the parking garage and the Bank One building need each other to thrive commercially, according to one local developer, who asked not to be identified in this report. Ultimately, if the parking garage is to be destroyed, so too would the Bank One building, he speculated.
“I think it’s just as likely that they’re talking about the whole block, not just the parking garage. There is discussion to develop the whole block,” he said. “Maybe you just blow them both down. I can’t see them just doing the garage. If you sell the garage, you’re screwed. The building’s no good without the garage. You could take it (the garage) down, but what are you going to do for the tenants (for parking) if you take it down?”
Other parking structures that were named as underperforming downtown sites in the SBT survey include the Marcus Center for the Performing Arts parking structure at the northwest corner of Water and State streets and the Milwaukee Athletic Club’s parking structure and parking lot near the club at 758 N. Broadway. The Milwaukee Athletic Club is seeking a developer to build a mixed use building on the site of its lot and parking structure. Irgens Development Partners LLC plans to build a high-rise office building on the site of the Marcus Center lot, and is seeking an anchor tenant and tax increment financing from the city for the project.
Meanwhile, the U.S. Cellular Arena is also high on the list of properties that should fall to the wrecking ball, according to many respondents to the SBT survey.
“The ‘Cell’ deserves to be demolished. And, in fact, it is THE perfect site for a convention hotel. It deserves the wrecking ball. Taxpayers would benefit, and it could help spark some major development where needed, especially if we cut a deal with the Potawatomi on the Ambrosia land for a casino,” said one prominent downtown business executive.
“The Arena was great in its day. The Beatles played there, we won an NBA championship there, but the calendar has moved on, and the place has not. When you look at what a building needs to do now – revenue, amenities, modern technology, suites, premium seating, quality food service, catering, a centerpiece for activity – that place just does not cut it. If not a hotel, it would be a great place for a casino,” he said.
The Arena’s location between the Midwest Airlines Center and the Bradley Center would make it a perfect site for a hotel to serve both facilities, some survey respondents said.
However, Franklyn Gimbel, chairman of the board for the Wisconsin Center District, which owns the Arena, strongly disagreed with those survey respondents. The U.S. Cellular Arena, the home of the Milwaukee Wave professional indoor soccer team and the University of Wisconsin-Milwaukee men’s basketball team, is a profitable venue and a key source of revenue for the district, which has no plans to tear it down, Gimbel said.
The district completed $10.5 million in renovations to the Arena to install new seats, a new scoreboard, widen the concourses and make other improvements.
“The U.S. Cellular Arena has had a resurgence of activity in the last two years,” Gimbel said. “It provides the Wisconsin Center District with a positive cash flow, which helps the (Midwest Airlines) convention center.”
Without the Arena, concerts and other events such as Disney on Ice and the circus, which are often held there, would have to be held at the Bradley Center instead. However, the Bradley Center is too large for many of those events, and winter open dates there are limited, especially during the weekends, because of that facility’s commitments to the Milwaukee Bucks, the Marquette University men’s basketball team and the Milwaukee Admirals, Gimbel said.
The best site for a new downtown hotel is a parking lot southwest of 4th Street and Wisconsin Avenue, across the street from the Midwest Airlines Center, Gimbel said. Some respondents to the SBT survey also pointed to that parking lot as one of the most underperforming sites in downtown. Brookfield-based Hunzinger Construction Co. plans to build a 255-room Sheraton Hotel there, but the project has been delayed by environmental problems at the site. Hunzinger is working out a cleanup plan for the site with the Wisconsin Department of Natural Resources, said Andrea Rowe, spokeswoman for the Milwaukee Department of City Development.
Gimbel said he wants to see a much larger, 1,000-room hotel built there, but some say the market in downtown Milwaukee would not support a hotel that large.
However, Gimbel said some conventions refuse to come to Milwaukee because the city does not have a downtown hotel with 800-plus rooms. A large hotel near the convention center would attract more conventions to the city, and therefore more visitors who would absorb the additional room capacity, he said.
“If you build it, they will come,” Gimbel said. “There is a shortage of downtown hotel rooms within walking distance to the convention center.”
The U.S. Cellular Area is one of several sites on the “Wrecking Ball Hit List” from the SBT survey that are government-owned properties and could be put to more productive uses by the private sector, which would also boost the property tax base, some real estate sources said.
Other government properties on the list or recommended for the list include the Pieces of Eight restaurant site, the Milwaukee County War Memorial building, the Marcus Center for the Performing Arts parking structure, the state office building at 819 N. 6th St. and the former U.S. Coast Guard station at 1600 N. Lincoln Memorial Dr.
Pieces of Eight, 550 N. Harbor Dr., is located on city-owned land, but the building and the restaurant is owned by Anaheim, Calif.-based Specialty Restaurants.
“We could do much better at that prime spot right on the lakefront,” said one commercial realtor.
The restaurant has a long-term lease for the site, said Pieces of Eight manager Miguel Martin.
“We’ll be here for awhile,” he said.
Specialty Restaurants spent about $2.5 million to revamp the Pieces of Eight building, Martin said. The company also changed the menu from continental to an emphasis on seafood and changed management by hiring Martin three months ago.
The restaurant is looking forward to the completion of construction on the $46 million Pier Wisconsin project next door. The Great Lakes Aquatarium and the relocated Discovery World, which will be located at Pier Wisconsin, could attract more diners to Pieces of Eight.
“Right now, it’s a bit of a war zone,” Martin said. “Some people think we’re closed because of the construction. But once the construction is done, it’s going to be a great site.”
Some of the older buildings in downtown Milwaukee should either be demolished or renovated, according to survey respondents.
Some pointed to the Sidney Hih building at 300 W. Juneau Ave., which stands out like a sore thumb next to the now-barren Park East freeway corridor. Knapp Street Realty Corp. plans to sell the property to Robert Construction and Development, which plans to convert it into 15 condominiums.
The 130-year-old, 260,000-square-foot former Hack’s Furniture building at 333 N. Plankinton Ave., was sited by some survey respondents. The building is for sale in hopes of attracting a developer to convert it into a mixed-use structure, said Andrew Jensen, a principal of Grubb & Ellis|Boerke Co., which is marketing the property. The building could be used for residential, retail, office and hotel space.
“I don’t think it’s ugly,” Jensen said. “It just has some pollution stains on it. I think somebody is going to rehab it, keep the facade and clean up the brick. We have had a fair amount of interest in it.”
Restauranteur “Johnny V” Vassallo is planning to buy the Posner Building at 152 W. Wisconsin Ave., named an underperforming downtown site by some survey respondents. The 97-year-old building is the site of two of his restaurants, Mo’s Irish Pub and Mo’s Cucina, and the offices of his company, Global Restaurant Systems. Vassallo wants to redevelop the building and add luxury apartments and an upscale salon and spa.
Downtown wrecking ball HIT LIST
Small Business Times surveyed city officials, commercial Realtors, developers and other prominent business executives to identify the downtown Milwaukee properties they most would like to see meet the wrecking ball or be renovated for greater uses. The following is a list of the most underperforming downtown sites.
1.
Bank One office building parking garage
Address:
111 E. Wisconsin Ave. (office building), 740 N. Plankinton (parking garage)
year built: 1961
Owner: Plaza Building Management Co. Marine Plaza
2004 assessed value:
$26.6 million (office building),
$3 million (parking garage)
Comment: “(The parking garage) is one of the worst buildings in Milwaukee from a street point of view,” said city planner Robert Greenstreet.
2.
U.S. Cellular Arena
Address: 420 W. Kilbourn Ave.
Year built: 1950
Owner: Wisconsin Center District
2004 assessed value:
$0 (publicly owned building)
Comment: “The ‘Cell’ deserves to be demolished. And, in fact, it is the perfect site for a convention hotel,” said one prominent downtown business executive.
3.
The Milwaukee Athletic Club’s parking structure and the adjoining firehouse
Address: 758 N. Broadway (building), 777 N. Milwaukee St. (parking structure), 784 N. Broadway (Engine House No. 1)
Year built: 1917 (building),
1966 (parking structure),
1872 (Engine House No. 1)
Owner: Milwaukee Athletic Club (building and parking structure), City of Milwaukee (fire house)
2004 assessed value: $7 million (building), $1.29 million (parking structure)
Comment: “Something needs to be done there,” said one real estate source. The Milwaukee Athletic Club is seeking a developer to build a mixed-use building on its parking lot and parking structure site.
4.
Sydney Hih building
Address: 300 W. Juneau Ave.
Year built: 1876
Owner: Knapp Street Realty Corp.
2004 assessed value: $922,000
Size: 25,369 square feet
Comment: The building stands out like a sore thumb along the now-barren Park East Freeway corridor. Knapp Street Realty Corp. plans to sell the property to Robert Construction and Development, which plans to convert the building into 15 condominiums.
5.
Pieces of Eight restaurant
Address: 550 N. Harbor Dr.
Year built: 1969
Owner: City of Milwaukee Board of
Harbor Commissioners
2004 assessed value:
$0 (Publicly owned building)
Comment: “We could do much better at that prime spot right on the lakefront,” said one commercial Realtor. “That is such an underutilized piece of ground. This city does not have a lot of great restaurants with good vistas. Improve the building and take better advantage of the site. It needs a fresh look inside and out. The inside is tired, the outside is tired. Just do something up to date, out of the 70s would be nice,” said another Realtor.
6.
The Marcus Center for
the Performing Arts
parking structure
Location: Northwest corner of Water and State streets
Owner: Milwaukee County
2004 assessed value:
$0 (Publicly owned building)
Comment: Irgens Development Partners LLC is planning to build a high-rise office building on the site. The firm is seeking an anchor tenant for the proposed building and has asked for tax incremental financing from the city.
7.
The former Hack’s
Furniture building
Location: 333 N. Plankinton Ave.
Year built: 1875
Owner:
Julius Bernstein IRR Trust; Sidney Hack IRR Trust; and Harry Hack IRR Trust.
2004 assessed value: $1.3 million
Size: 302,506 square feet
Comment: “That building is beastly, and it’s in a great location,” said one commercial Realtor. “I don’t think it’s ugly,” said Andrew Jensen, a principal of Grubb & Ellis|Boerke Co. “It just has some pollution stains on it. I think somebody is going to rehab it, keep the fa?ade and clean up the brick.”
8.
The Posner building
Location: 152 W. Wisconsin Ave.
Year built: 1908
Owner: Gene Posner/Caswell Investments
2004 assessed value: $2.8 million
Size: 108,334 square feet
Comment: Restaurateur “Johnny V” Vassallo is planning to buy the building from Posner. Vassallo has two restaurants, Mo’s Irish Pub and Mo’s Cucina, and the offices for his company, Global Restaurant Systems, in the building. Vassallo wants to redevelop the building and add luxury apartments and an upscale salon and spa.
9.
Milwaukee County
War Memorial building
Location: 750 N. Lincoln Memorial Drive
Year built:
Owner: Milwaukee County
2004 assessed value: $0 (Publicly owned building)
Comment: “That thing looks the same as when it was built. It really looks dated and out of place next to the Calatrava, It needs a major overhaul,” said one city official. “I’m all in favor of honoring veterans. But that thing just doesn’t belong on the lakefront. We can do better there,” said one commercial Realtor.
10.
The Renaissance Books building
Location: 834 N. Plankinton Ave.
Year built: 1900
Owner: Robert John
2004 assessed value: $350,000
Size: 18,560 square feet
Comment: “Something should have been done with that building a long time ago,” said one former city development official. “A lot of that stuff in there is hodgepodge,” said one commercial Realtor.
11.
The former Journal Sentinel production space
Location: Along Fourth Street between State Street and Kilbourn Ave.
Owner: Journal Communications Inc.
Comment: The space has been dormant since the company moved its print production to a new plant in West Milwaukee in 2003. Major Goolsby’s bar and restaurant is attached to the south of the dormant space. “Now that the paper isn’t using that space, it’s just sitting there. It could be a good retail space,” said one commercial Realtor.
12.
The Reuss Federal Plaza
Location: 310 W. Wisconsin Ave.
Year built: 1982
Owner: Federal Plaza Associates
2004 assessed value: $34 million
Size: 693,953 square feet
Comment: The glass-faced federal building, known locally as “Big Blue,” has lost U.S. government tenants in recent years. “That big blue thing can’t compete in the market. West of the river, office is not the best use for that site,” said one commercial Realtor.
Other nominations:
— “All of the buildings on the north side of West Wisconsin Avenue between Second and Third streets,” said one commercial Realtor.
— The retail space on the northeast corner of Wells Street and Broadway Avenue.
— The Pioneer Technology Center, 625 N. Milwaukee St.
— The Greyhound Bus station, 606 N. James Lovell.
— 200 W. Wells St.
— The former U.S. Coast Guard station at 1600 N. Lincoln Memorial Drive (The county plans to lease the building out for an Indian cultural center).
— Several surface parking lots, including: The Coachyards lots next to the Italian Community Center and the Summerfest grounds; the lot at Fourth Street and Wisconsin Avenue (a hotel has been proposed for the site, but the project is dragging on); the lot east of the Pfister Hotel and north of the Milwaukee Club; the lot east of Water Street and north of Juneau Avenue; the parking lots at Schlitz Park along the Milwaukee River (“Every one of the city’s surface parking lots near the river are a waste. Look at the parking lots at Schlitz Park. Think about the runoff from those lots into the river. Every day. It’s disgusting,” said one former city development official.); the lot at St. Paul Avenue and Water Street (“It’s on the river and Third Ward Riverwalk. It’s kitty-corner from the new Milwaukee Public Market. It’s at the entryway to the Third Ward from the freeway and the central business district. It needs a boutique hotel,” said one commercial Realtor.).

March, 4, 2005, Small Business Times, Milwaukee, WI

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Andrew is the editor of BizTimes Milwaukee. He joined BizTimes in 2003, serving as managing editor and real estate reporter for 11 years. A University of Wisconsin-Madison graduate, he is a lifelong resident of the state. He lives in Muskego with his wife, Seng, their son, Zach, and their dog, Hokey. He is an avid sports fan and is a member of the Muskego Athletic Association board of directors.

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