Milwaukee-based Marcus Corp.’s plans to develop a 600,000-square-foot commercial real estate development at Barker Road and Bluemound Road in the Town of Brookfield with about 480,000 square feet of retail space, anchored by a Von Maur department store, could create a significant shift in the southeastern Wisconsin retail real estate market.
Davenport, Iowa-based Von Maur has 25 locations in the Midwest, but none in Wisconsin. Von Maur is a high-end department store chain. There are not many high-end department stores in the Milwaukee area, a community notorious for its frugality. The only department stores in the region that could possibly be considered high-end are the Macy’s store at Mayfair Mall and the Boston Stores at Bayshore Town Center, The Shops of Grand Avenue, Mayfair Mall, Southridge Mall, Brookfield Square and Regency Mall in Racine.
Some retail real estate professionals say a Von Maur store in Brookfield would become the region’s top high-end shopping destination.
“Their product lines are better than Macy’s,” said Cory Sovine, vice president of retail with Milwaukee-based Siegel-Gallagher Inc. “Maybe not on par with Nordstroms, but close.”
Another Milwaukee retail real estate source said Von Maur’s offerings are similar to Macy’s, but the shopping experience at Von Maur is similar to a Nordstrom store with a high level of customer service and quality store design.
For many Milwaukee area residents the top shopping destinations are Mayfair Mall in Wauwatosa and Bayshore Town Center in Glendale. Those two malls offer the most impressive store lineup in the region.
But the Von Maur store could make the shopping center developed by the Marcus Corp. the new top shopping destination in the region.
“This could inevitably draw a significant amount of traffic to buy luxury goods,” Sovine said.
The Von Maur store might even encourage Milwaukee area residents who go to Chicago for high end shopping to shop in Brookfield instead, Sovine said.
With the Von Maur store as an anchor, Marcus might be able attract other high end national retail chains that previously have stayed away from the Milwaukee area, Sovine said.
“I could see something like a Tiffany’s or other similar luxury brands at least taking a look at this,” he said.
Some retailers with a presence at Bayshore but not in the western suburbs might be attracted to the Marcus Corp. project in Brookfield said Peter Glaser, first vice president of CB Richard Ellis.
“With (the Marcus Corp. project design) being similar to Bayshore, you could see a lot of duplication,” he said. “A retailer or restaurant that has a presence at Bayshore but doesn’t have anything to service the west side might find it appealing.”
With a Von Maur anchor, Marcus should have no problem attracting other tenants to the project and should hold out for high end tenants that are not currently in the area, Sovine said.
“If Marcus does this right they will differentiate themselves from Brookfield Square by exclusively going after high end tenants,” he said.
The Bluemound Road corridor in Brookfield has had an increasing amount of vacant retail space in recent years. The former Circuit City and Linens ‘n Things stores on the road are still vacant. The Marcus Corp. project will increase the supply of retail space in the corridor. However, some retail real estate brokers say the additional traffic generated by Von Maur and other tenants in the project should help attract tenants to the rest of the Bluemound Road corridor.
“If you add a department store like Von Maur in your trade area you are going to increase the number of shopping trips to the area,” Glaser said. “I think (Von Maur) is going to make Bluemound more of a destination for the region, and that will be good for the street.”
The biggest loser from the Von Maur-anchored Marcus Corp. project might be Pabst Farms, the massive mixed use development at I-94 and Highway 67 in Oconomowoc. For years the project’s developer, Peter Bell, planned to develop a high end shopping center at Pabst Farms along I-94. However, those plans were stalled during the Great Recession. Now Pabst Farms will have to compete with Von Maur in Brookfield, which is closer to the center of the region’s population base.
“This absolutely kills any chance of Pabst Farms having a high-end shopping center for 5 to 10 years,” Sovine said. “At lease for the next 5 to 10 years (the Von Maur store) negates the ability of Pabst Farms to get a Nordstrom or Von Maur to compete with it. The density isn’t there to sustain two of those stores.”
Housing development needs to resume in western Waukesha County in order for Pabst Farms to reach its full retail development potential, Glaser said. In the wake of the Great Recession established trade areas, such as Brookfield, are recovering before emerging trade areas, such as Oconomowoc, he said.
Another loser in the Von Maur deal could be Brookfield Square. The owner of the mall, Chattanooga, Tenn.-based CBL & Associates Properties Inc. tried to add Von Maur, but was blocked by Boston Store owner Bon-Ton Stores Inc., which has an exclusive use clause requiring its approval for the addition of a competitive store. Boston Store is the premier store at every other Milwaukee area shopping center, and Bon-Ton probably wanted to keep it that way, Sovine said.
“Milwaukee is a very tight market in terms of these shopping centers,” Sovein said. “Why would (Bon-Ton) want somebody else to come in?”
The Marcus Corp. development is planned for the former West Point Cinema site, a former Menards store site and the West Point Plaza strip mall. Gov. Scott Walker recently signed a bill allowing the Town of Brookfield to create a tax incremental financing (TIF) district to assist the project. Ordinarily towns do not have legal authority to create TIF districts, but the legislature passed a bill to allow the Town of Brookfield to create a TIF district for this project.
“We are focused on doing everything we can to make it easier for employers to do business and put more people to work, and this TIF district is another tool for job creation,” Walker said.
The project will be similar to, but smaller than, Bayshore Town Center in Glendale, said Katie Falvey, director of real estate for Marcus Corp. The design architect for the project is Baltimore-based Development Design Group Inc., which also was the design architect for Bayshore Town Center. Milwaukee-based Eppstein Uhen Architects will be the architect of record for the project.
The architecture for the Marcus Corp. project will be similar to Bayshore, Falvey said.
“Traditional high-quality architecture, open air Main Street kind of a theme,” she said.
Similar to Bayshore, the Marcus Corp. project will mostly have two-story buildings with retail space on the first floor and usually office space on the second floor.
Also similar to Bayshore, the Marcus Corp. project will have a central town square green space and a road running through the development right up to the buildings with parallel parking spaces.
The Marcus Corp. project will also have 1,000-space underground parking area underneath the buildings. The site is sloped on a hill. The underground parking will be built into the hill and the buildings will be built on top of the underground parking. The first level of some of the buildings, including the Von Maur building, will connect with the underground parking area.
Escalators in the underground parking area will take shoppers up directly to the town square green space.
The project will have a total of 1,900 parking spaces.
Fitchburg-based Tri-North Builders Inc. is the construction manager for the project and Bruce Westling of NAI MLG Commercial is handling leasing for the project.