The significant amount of development occurring along I-94 between Milwaukee and Illinois, including plans for the massive Foxconn complex in Racine County, was the subject of the 2017 BizTimes Commercial Real Estate and Development Conference, sponsored by Bank Mutual and Husch Blackwell and held Friday at the Italian Community Center in Milwaukee.
Kelly O’Brien, the president and CEO for the Alliance for Regional Development, gave the keynote address. The Alliance for Regional Development is a coalition of business, government, and academia working to strengthen the economic competitiveness of Chicago’s 21-county tri-state region, which includes southeastern Wisconsin.
O’Brien gave a 10,000-foot view of the significance of the three-state Chicago mega region, which she said is the third largest contributor to U.S. gross domestic product.
“We are an international powerhouse,” she said. “So many people forget how important this region is nationally and internationally.”
To leverage the opportunities of this mega region, leaders must work together and avoid getting hung up on local jurisdictions, O’Brien said.
“The idea of borders and sovereignty, that’s gone,” she said. “If we want to compete globally we have to forget about these arbitrary boundaries. Regions win.”
But some government officials have been reluctant to do so. O’Brien said she was severely chastised by one state commerce secretary, she wouldn’t say who, when she was working for form the Alliance.
“I honestly had one of the three (states’) commerce secretaries screaming and swearing at me telling me there was no way they would get involved working with other states,” she said. “You have no idea what I have been through trying to break down the barriers of economic development.”
Wisconsin, Illinois and Indiana officials need to work together to address transportation and workforce challenges, O’Brien said. To attract more workers to the region, they should collaborate on a promotional campaign, she said.
“We need to get together and (promote) why people should want to move here and be here,” she said. “As Midwesterners we are not comfortable promoting ourselves.”
Following O’Brien’s remarks a panel of Illinois and Wisconsin commercial real estate professionals discussed the development trends along the I-94 north-south corridor between Milwaukee and Illinois. The panel discussion was moderated by Dr. Mark Eppli of Marquette University, an event partner along with the Commercial Association of Realtors Wisconsin.
Several companies have moved from Illinois to Kenosha County in recent years. The panelists named several reasons.
“Historically it’s been because Wisconsin has a better business environment than Illinois,” said Andy Bruce, principal for Brookfield-based MLG Capital.
Lower taxes in Wisconsin and local governments that are friendly and work quickly has also helped attract businesses from Illinois, said Ed Harrington, senior vice president of Oak Brook, Illinois-based CenterPoint, which has several real estate assets in southeastern Wisconsin.
“Our customers want to be in this area,” he said.
Land availability, lower costs and a location in between Milwaukee and Chicago have helped Wisconsin attract Illinois businesses, said Sam Badger, senior vice president in CBRE’s Chicago Advisory and Transaction Services Group. State and local incentives are also helpful, but have not been the most important factor, he said.
Workforce availability is a challenge, but proximity to the massive Chicago-area population helps businesses along I-94 between Milwaukee and Illinois.
“The commute from northern Illinois to Pleasant Prairie or Kenosha is very short,” said Badger. “It’s like an extension of Lake County (Illinois).”
Kenosha County has a workforce of about 80,000 to 90,000 and about 35,000 of them work outside of the county (about two-thirds in Illinois), according to S.R. Mills, president and principal of Kenosha-based Bear Development. That workforce export is an opportunity for companies to move to the area, he said. Badger said that worker export is included when CBRE pitches buildings in Kenosha County to potential tenants.
Kenosha and Racine counties may not be seen as top destinations for younger workers. Investments in downtown areas in those counties could help create environments attractive to millennials, Mills said.
“A lot of those downtowns have been forgotten for the last 50 years,” he said.
The area workforce demands are going to increase significantly with the Foxconn facility, which could have 13,000 employees. The 32 million-square-foot complex is also expected to attract numerous suppliers to the area.
Speakers said the Foxconn project could have a tremendous impact on the I-94 north-south corridor.
“I don’t think any of us has seen a development of this magnitude before,” Bruce said.
In addition to main event sponsors Bank Mutual and Husch Blackwell, the supporting sponsor for the BizTimes Commercial Real Estate and Development Conference was Anderson Ashton Design/Build.
Exhibit sponsors were: Acoustech Supply Inc., Bear Real Estate Group, Creative Business Interiors, David J. Frank Landscape Contracting Inc. and Innovative Signs.
