The United States Postal Service (USPS) plans to build a new mail processing and distribution facility in southeastern Wisconsin and is considering seven sites, including three in Johnson Creek, three in Racine County and one in Oak Creek.
According to a USPS spokesperson, the new facility will create about 500 jobs. The new facility would not affect operations or employment levels at the USPS’ main downtown Milwaukee facility at 345 W. St. Paul Ave., where about 1,700 people work, said USPS spokesman Dave Partenheimer.
“The proposed facility will enable the Postal Service to deploy the right number of the right type of modern mail processing equipment to the service area,” Partenheimer said. “While some types or classes of mail – such as First Class letters – are not growing or are efficiently handled by automation, other types or classes of mail are growing or present an opportunity for more effective and efficient mail processing operations – such as packages or what we call flats.”
It is too early to say what the new facility will cost to build, Partenheimer said.
The USPS is making the plans for the new facility about three years after it dropped plans to build a new complex to replace the main downtown Milwaukee facility, which is owned by a group of investors. The USPS’ lease at the downtown facility expires in 2035, Partenheimer said. The 940,000-square-foot downtown facility was built in 1967. It is located along the Menomonee River, next to the Amtrak train station, which the state Department of Transportation is remodeling at a cost of about $15.8 million.
The Postal Service recently solicited proposals from property owners for either a 30- to 60-acre parcel of vacant property or an existing 471,000- to 741,000-square-foot facility within one mile of Interstate 94 in Milwaukee, Racine, Waukesha or Jefferson counties. The Postal Service received proposals for seven sites, all of which are vacant land, and USPS officials are trying to decide which site to build upon.
The USPS plans to select a site for the new facility around Oct. 1, Partenheimer said. The USPS plans to have the facility built and up and running by the end of 2007, he said.
“We’ve been looking for sites that are already zoned for industrial use,” said Bob Gintoff, senior vice president of NAI MLG Commercial, who is representing the USPS. “There aren’t many sites available that are zoned (industrial) and have sewer and water. The city of Milwaukee didn’t have a site that was large enough.”
The seven sites that owners are bidding for the USPS project are all zoned for industrial use and have access to sewer and water services, Gintoff said. The sites are:
• A 132-acre site southeast of I-94 and Highway 20 in Mount Pleasant. The property is owned by MLG Development and the Village of Mount Pleasant.
• A 39-acre site in the Renaissance Business Park, just off of Highway 11 in Sturtevant, owned by MLG Development. Another 20 acres could be added to the east of that site, Gintoff said.
• A 39-acre site in the GrandView Business Park in the Town of Yorkville owned by Wispark LLC and CenterPoint Properties. Wispark and CenterPoint also have 10 acres available across the street, and they have an option to purchase another 20 acres adjacent to the site, Gintoff said.
• A 60-acre site owned by Opus North Corp. northwest of Oakwood Road and Howell Avenue in Oak Creek. The USPS had considered this site three years ago as the place to build a facility to replace the downtown Milwaukee facility, until those plans were dropped.
• A 143-acre property owned by Robert Rehm southeast of I-94 and Highway 26 in Johnson Creek.
• A 49-acre property in Johnson Creek owned by MSI General Corp. at Old Highway 26 and River Drive, near the Johnson Creek Premium Outlets outlet mall.
• A 54-acre property in Johnson Creek owned by Robert Rehm between I-94 and Resort Drive.
Just because NAI MLG Commerical is helping the USPS find a site for the facility does not mean one of the properties owned by MLG Development will be selected as the site for the new plant, Partenheimer said.
“NAI MLG is the Postal Service’s buyer’s broker,” he said. “They have a fiduciary responsibility to the Postal Service. However, any owner can submit any site, but that does not mean that the site will be selected. The Postal Service will ensure that any potential conflicts of interest of any type will be dealt with appropriately.”
Good Electric is moving to suburbs
Good Electric Co, an electrical contractor, plans to sell its building at 3505 W. Kiehau Ave., Milwaukee, and move to Pewaukee by Oct. 1.
The company, which has 52 employees, has been located in Milwaukee since 1929, when Fred Bohne, the grandfather of current company president Gregg Eisenhardt, started the business in his garage in Bay View. The company has been located in a 10,500-square-foot building on Kiehau Avenue since 1972.
The property, located just northwest of Teutonia Avenue and West Mill Road, was originally part of the Kiehau family farm, Eisenhardt said. Part of the building was once a small house dating back to the late 1800s, he said.
The building has gone through many changes since then. According to the City of Milwaukee’s records, it was built in 1935.
“It’s not quite what I would call historical, but it’s an interesting building,” Eisenhardt said.
In Pewaukee, Good Electric will occupy about 8,000 square feet of space in a multi-tenant building owned by Dennis Boschi at W226 N887 Eastmound Drive. The biggest reason for the move, Eisenhardt said, is that the company needed more office space and less warehouse space. The company’s current building has about 3,000 square feet of office space and about 7,000 square feet of warehouse space. The Pewaukee space will have about 4,000 square feet of office space and about 4,000 square feet of warehouse space.
Good Electric does business throughout Wisconsin, and some in Illinois. An increasing number of the company’s customers live in the western part of the metro Milwaukee area, and many of the firm’s employees live in that area, Eisenhardt said.
The high crime rate and high property taxes in the City of Milwaukee are other reasons the company is moving, Eisenhardt said.
“Crime problems have been pretty minor around here, but the area does seem to be going downhill,” Eisenhardt said. “This side of town has been sort of a dying area. You see lots of vacancies here. I think our property value is declining.”
However, the city assessed the building’s value at $165,000 in 2005 and $235,000 in 2006.
“I wrote an objection to that big hike in the assessed value,” Eisenhardt said. “Properties in this area are not selling. There are a lot of buildings for sale. Some have been on the market for over a year. It took me over 2-1/2 years to sell this building. While I think that the assessment was fairly accurate, I objected to the quick jump. (The city is) really looking for money.”
The city’s high property taxes are “a large factor” that prompted the company to move to Pewaukee, Eisenhardt said. In its lease, Good Electric will pay for the property taxes for the portion of the building it is occupying. Eisenhardt said he expects that expense to be much lower than the property taxes his company is paying in Milwaukee.
Good Electric bought the property in 1972 from August Wulf Co., which was a cabinet-maker, carpenter and interior remodeling company. Now Good Electric is selling the property to 3505 Kiehnau LLC, which is an arm of a landscaping firm.
Historic building cleanup
Parts of the former Pritzlaff/Hack’s Furniture building at 333 N. Plankinton Ave. in Milwaukee got a new look recently when workers used chemicals to clean the brick exterior, removing years of grit and grime and restoring the appearance of the cream city brick. Franklin-based Sunset Investors plans to restore the building. Part of the seven-story, 300,000-square-foot building was constructed in 1875.
Sunset Investors is trying to obtain historical preservation tax credits to help support the $35 million redevelopment.
“Without the tax credits, it’s very difficult to do,” said Sunset Investors president Kendall Breunig.
The state has approved the tax credits, but Sunset Investors is still waiting for approval from the National Parks Service, Breunig said. Sunset Investors is also trying to obtain new market tax credits for the project he said.
Sunset Investors will continue to clean up the interior and exterior of the building and remove asbestos, Breung said. He hopes to begin major construction work in the spring.
Information about the project is available at www.sunsetinvestors.com/ pritzlaff.htm. The plans displayed there include 100,000 square feet of commercial and retail space, 83 residential units and a 300-car parking garage with tennis courts on the top level.
Menard plans new Sheboygan store
Eau Claire-based Menard Inc. plans to build a new, 230,000-square-foot store on a 50-acre property northwest of Highway 42 and Interstate 43. The new store will be about three times the size of the existing Menard’s store at 4309 County Highway J, said Theron Berg, senior real estate associate for Menard.
“The (current) store is probably 20 years old,” Berg said. “Over the past 10 years we have been trying to update all of our stores.”
Menard also plans to replace its store on Blue Mound Road in Brookfield with a new, two-story 230,000-square-foot store at the southwest corner of Highway JJ and Kossow Road in Waukesha.
The company plans to sell the Brookfield and Sheboygan properties after the new stores open, Berg said.
Menard is the third-largest home improvement chain in the nation, with about 210 stores, all in the Midwest.
The new Menard’s in the Town of Sheboygan will be located just north of where Wal-Mart plans to build a new 185,000-square-foot Supercenter store. The controversial Wal-Mart project was approved recently by the Town of Sheboygan Board. Both the Wal-Mart and Menard’s projects are expected to break ground next year and be completed in 2008.
Two hotels proposed near I-43 in Grafton
Milwaukee-based Paul Weise Real Estate Corp., which had planned to develop a Holiday Inn Express hotel with a Green Mill restaurant southeast of I-43 and Highway 60 in Grafton, has changed the hotel flag to Hampton Inn & Suites. The project now calls for an 84-room, four-story hotel with a Texas Roadhouse restaurant and a convenience store or bank branch, said Paul Weise, the owner of the company. “It is a better flag,” he said. “It is the best thing we could get for that site.”
Hilton Hotels Corp., which owns Hampton Inn & Suites, was more interested in the project than Holiday Inn, which already has a location in downtown Port Washington. Hampton Inn has three locations in Milwaukee County and one in Brookfield, but none near Grafton. Meanwhile, Milwaukee-based Heartland Development Group plans to build a hotel and convention center on 72 acres of farmland located northeast of I-43 and Highway 60, just north of a Colder’s store. A representative for Heartland Development Group declined to provide more details about the project. Weise said he doesn’t want to see another hotel developed near his site, but he said it will not affect his plans. “We have a better location, clearly,” he said.
More Milwaukee news
El Rey Mexican Products recently broke ground on a new $5.5 million supermarket at 916 E. Cesar Chavez Drive. The new store, expected to open in the spring, will occupy almost a full city block and will replace the El Rey supermarket across the street at 1320 S. Cesar Chavez Drive.
El Rey Mexican Products owns five supermarkets, including a space in the Milwaukee Public Market and also produces tortillas, tortilla chips and other Mexican food products.
Dykeman Family Corp., a mechanical contracting firm, and Dykeman Property anagement LLC have moved to a new location at 2510 W. Capitol Drive, Milwaukee, a 46-year-old, 12,000-square-foot building which was recently purchased by Dykeman Properties 2508-18 LLC. The Dykeman businesses will occupy about 6,000 square feet of space in the building and another 6,000 square feet of office space will be leased to tenants, said Mike Dykeman, project coordinator for Dykeman Family Corp. Dykeman Family Corp. was located at 1023 E. Brady St., but needed more space, Dykeman said. Dykeman Property Management had previously been run out of Dykeman’s Milwaukee home.
Kenosha
First Industrial Realty Trust Inc., a Chicago-based real estate investment trust (REIT), has a contract to purchase approximately 70 acres of vacant land at the northeast corner of 52nd Street and 88th Avenue near the Kenosha Regional Airport from Johnson Houston Partners.
First Industrial plans to build several speculative industrial buildings on the property, said regional manager Peter Ginn. The first would be about 250,000 square feet and construction will probably begin next year, if some wetlands issues can be worked out with the state Department of Natural Resources, Ginn said. Eventually, First Industrial plans to have about 1.2 million square feet of industrial space on the property, he said.
Kenosha County has become an attractive area for industrial development as sprawl from the Chicago area continues to push north into Wisconsin. In addition, there is a shortage of suitable sites for new industrial development in the Milwaukee area, so developers are looking to the south, Ginn said. “You just can’t find anything,” he said. “If I could find 200 acres in Waukesha County (suitable for industrial development) I would buy it.” There is also a lack of adequate sites for new industrial development in Lake County, Ill., which is prompting more firms down there to look north when they need new facilities, he said.
Towne Investments, a division of Milwaukee-based Zilber Ltd., and Interstate Partners recently began construction of a 83,641-square-foot speculative industrial building on a 5.93-acre site in the Business Park of Kenosha.
West Bend
Germantown-based Gehl’s Guernsey Farms Inc. plans to build a plastic bottle manufacturing plant in the River Road Industrial Park. The first phase will have 117,000 square feet of plant and office space and will be completed in August 2007. The second phase will add an additional 136,000 square feet of plant space, bringing the facility’s total size to 253,000 square feet, and will be completed in 2008. The plant will be owned by Gehl’s and operated by York, Pa.-based Graham Packaging.
Brookfield
Briggs & Stratton Corp. plans to move its Briggs & Stratton Yard Power Products, formerly known as Simplicity Manufacturing Inc., from Port Washington to a 26,137-square-foot space at 3505 N. 124th St. in Brookfield. Inland Companies brokered the deal. Briggs & Stratton will move 90 employees from Port Washington to Brookfield. The company’s plant in Port Washington will continue to operate with about 400 employees.
Waterford
Big Bend Development is developing a 65-acre parcel of vacant land along the west side of Highway 36 between Main Street and Beck Drive. The development includes Trail View Crossing, which consists of 62 condominiums, and Trail View Centre, which consists of commercial development including a 5,000-square-foot Equitable Bank branch, which will begin construction in the spring and a 40-bed assisted living facility, being built by Janesville-based developer Scott Shadel and his partners, is under construction. In addition, Big Bend plans to build a multi-tenant commercial building with about 10,000 square feet of space and a senior apartment complex. Big Bend also hopes to attract a gas station/convenience store, restaurants, retail stores and offices to the development. RFP Commercial is representing Big Bend Development in marketing the site to potential tenants.
Mequon
Wauwatosa-based Irgens Development Partners LLC plans to build a two-story, 40,000-square-foot office building on a vacant 3.2 acre property at 12080 N. Corporate Parkway. Irgens plans to break ground on the project this fall and have the building ready for occupancy by early next summer. Other office buildings in the area owned and managed by Irgens have very little space available, so new office buildings are needed said Jason Luther, development director for Irgens. “It’s a desirable area for some of these higher-end office tenants,” he said. “At this point the buildings we manage and own (in Mequon) have only around 1,700 square feet available.”
Andrew Weiland is the managing editor of Small Business Times. Send news about commercial real estate to Andrew.weiland@biztimes.com or by calling him at (414) 277-8181 ext. 120. News can also be sent to Andrew Weiland, Small Business Times, 1123 N. Water St., Milwaukee, WI 53202.
Leases
Inland Companies
Briggs & Stratton Corp. leased 26,137 square feet of office space at 3505 N. 124th St., Brookfield.
Oncology Alliance leased 10,812 square feet of office space at Stone Ridge III, 2383 W. Stoneridge Dr., Waukesha.
KAT Logistics leased 8,600 square feet of warehouse space at 1800 Bolivar Ave., St. Francis.
Glencastle Irish Dancers leased 3,885 square feet of office space at West Allis Center, 1126 S. 70th St., West Allis.
Manpower Inc. leased 1,919 square feet of retail space at 418 N. Mayfair Road, Wauwatosa.
Relation System leased 1,200 square feet of office space at 1099 Quail Ct., Pewaukee.
PJ’s Dental Lab Inc. leased 747 square feet of office space at West Allis Center, 1126 S. 70th St., West Allis.
Mid-America Real Estate
Small Stones leased 3,772 square feet of space at V. Richards Plaza, 17105-65 W. Bluemound Road, Brookfield, from Inland Property Management.
Once Upon A Child leased 3,008 square feet of space at Elmbrook Plaza, located at the northwest corner of 124th Street and North Avenue in Brookfield, from Alexander & Bishop.
Taco Bell leased 3,500 square feet of space at Burlington Retail Center, on Highway 36 in Burlington, from MRED Associates.
Ogden & Company Inc.
Mary M. Christensen d.b.a. State Farm Insurance Agency leased 890 square feet of office space in the Ogden Center at North Port Washington Road and Brown Deer Road in Bayside.
Lakeside Finance Corp. leased 1,015 square feet of space in the Oaks Professional Building at 8112 W. Bluemound Road, Wauwatosa.
Sales
Colliers Barry
RHH Foam purchased the 16,900-square-foot industrial building at 17100 W. Victor Road, New Berlin, from George C. Adams. RHH Foam plans to move to the building from 6001 S. Pennsylvania Ave., Cudahy.
Inland Companies
OnCourse Inc. purchased a 57,000-square-foot flex building at 4066 N. Port Washington Road, Glendale.
Mike Becker purchased a 900-square-foot flex building at 7928 W. Clinton Ave., Milwaukee.
Mid-America Real Estate
NAPA Auto Parts purchased a 0.85-acre outlot at the southeast corner of Good Hope Road and North 76th Street in Milwaukee from MidAm Milwaukee LLC.
Clubhouse Development Group LLC purchased 47,916 square feet of space at 5534 Washington Ave., Mt. Pleasant, from Thomas Petersen and Timothy Petersen.
Ogden & Company Inc.
Akash Properties purchased a lot in the new Lannon Road Business Center at Highways 41 and 45 in Germantown from Frederick and Cheri Carlson.
New construction
Inland Construction, Milwaukee, was recently awarded the 500,000-square-foot site clearing and demolition project at 8201 S. Howell Ave., Oak Creek. Inland Construction was also recently awarded the 60,000-square-foot exterior remodeling contract for office and warehouse space at 4066 N. Port Washington Road, Glendale, for Oncourse Information Services. Inland Construction was also awarded a contract for a 9,300-sqquare-foot interior improvement for the medical offices of Oncology Alliance in Stoneridge III at N14 W23833 Stoneridge Dr., Waukesha.
MSI General Corp., Oconomowoc, was selected to design and build a 14,900-square-foot retail center and a 62,000-square-foot Pick ‘n Save store at 2200 Miller Park Way, West Milwaukee.
Beyer Construction, New Berlin, has begun construction of Woodlands Marketplace at Appleton Avenue and Good Hope Road in Menomonee Falls. Beyer is building two mixed-use buildings with a total of 21,000 square feet of space.
Briohn Building Corp., Brookfield, was selected to design and build an 8,500-square-foot tenant build out for Home Care Medical in the Edgewood Center at 4818 S. 76th St., Greenfield. Briohn has also been contracted to design and build a 6,500-square-foot interior remodel for Animal Adventures at 5453 S. 76th St., Greendale. Briohn also recently completed the design and construction of a 10,800-square-foot tenant improvement for Integrated Risk Solutions Inc. at W237 N2920 Woodgate Road Suite 400, Pewaukee.
MEDC loans
Surfaces Transport Inc. received a $400,000 MEDC loan. The company plans to purchase the former Red Carpet Bowling Alley building at 7320-7400 W. Florist Ave. It will be remodeled to provide warehouse space. Surfaces Transport has 62 full-time employees and plans to add 18 more.
Forest Home Animal Clinic S.C., 11222 W. Forest Home Ave., Franklin, received a $536,000 SBA loan. The clinic plans to add a 3,383-square-foot addition to its 1,729-square-foot building.
