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Tosa retail plan praised, but also draws concerns over lack of offices

Land and Space

Journal Sentinel business reporter Tom Daykin talks about commercial real estate and development.

April 12, 2011
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By Tom Daykin of the Journal Sentinel

April 12, 2011 0

A plan to convert warehouses in Wauwatosa's Burleigh Triangle area into new stores won praise from the city Plan Commission Monday night, but also drew concerns over a lack of office space in the development plan.

Chicago-based HSA Commercial Real Estate Inc. is proposing the development, called The Mayfair Collection, for 69 acres east of Highway 45 and north of W. Burleigh St.

HSA Commercial owns the former Roundy's and Kohl's supermarket warehouses totaling around 62 acres at the site. A 7-acre warehouse property, operated by Total Logistic Control, is in the middle of the site, which HSA Commercial also hopes to eventually include in its project.

In the project's first phase, HSA Commercial plans to demolish part of the former Roundy's warehouse complex, just east of Highway 45, and convert the remaining space into roughly 250,000 square feet of retail space.

Another initial phase calls for stores and restaurants to be in new buildings developed just north of Burleigh St., said Tim Blum, of HSA Commercial.

Future phases could eventually include additional retail space, as well as office and residential space.

The Mayfair Collection site plan includes walkways connecting the various phases, as well as an internal street system, with parking to the rear of the buildings, said project planner Ferhat Zerin, of Orland Park, Ill.-based Ginkgo Planning and Design Inc.

The first phase of converting former warehouse space into stores -- a project that could include such tenants as Nordstrom Rack and The Container Store -- would produce an estimated $900,000 of additional annual property tax revenue, $4 million in annual state sales taxes, and 500 part- and full-time jobs, Blum said.

HSA Commercial, in a separate action, plans to ask the city to help fund road work and other public improvements through a tax incremental financing district, Blum said.

Under that proposal, funds that HSA Commercial spends on those public improvements would be repaid to the firm through rebates on the development's property taxes, he said.

Once the firm's costs of paying for the public improvements is compensated, the project's property taxes would then flow to the city, its school district and other local governments. The amount to be sought by HSA Commercial hasn't yet been publicly disclosed, and that proposal will require separate approvals from the Plan Commission and Common Council.

At Monday night's meeting, Mayor Jill Didier and other Plan Commission members praised HSA Commercial's preliminary development proposal, with Commissioner Chris Jackson calling it "an exciting development."

But there also were concerns, including questions about HSA Commercial's emphasis on retail use over office use.

The city's master plan for the project site calls for more office and housing -- and less retail -- than what HSA Commercial is proposing. Commissioner Gloria Stearns said less office space means fewer well-paying jobs, which reduces the economic impact of redeveloping the site.

Blum, however, said HSA Commercial has seen little demand for office or housing at the site. Meanwhile, there is demand for retail space from store operators that want to be near Mayfair Mall but cannot find space along N. Mayfair Road, he said. 

Commissioner John Albert said HSA Commercial's proposal may not be as "pretty" as the city's master plan.

But, Albert added, the firm's proposal "has a better chance of getting done."

The commission voted, 6-0, to approve the preliminary plan, with a recommendation that concerns about the project be addressed by the Common Council's Community Development Committee. That committee is to review the preliminary plan at its April 26 meeting before sending it to the full council.

The commission and council also will eventually review final plans for the project, in addition to the  financing proposal.

(The rendering below, from Bondy Studio, depicts the rebuilt warehouse space).

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About Tom Daykin

Tom Daykin covers commercial real estate and development.

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Helpful Links and Resources

Check the Milwaukee Assessor’s Office website, which includes tools to look up property assessments.

Find property assessments for other communities throughout the state at AssessorData.org.

The Milwaukee Department of City Development website includes information on the city Plan Commission and Redevelopment Authority.

The Commercial Association of Realtors Wisconsin offers information on commercial realtors and real estate.

The Milwaukee chapter of the Institute of Real Estate Management serves the needs of real estate management professionals

The Wisconsin chapter of the NAIOP Commercial Real Estate Development Association aims to serve developers and owners of commercial real estate.

Awards

The Land and Space blog was recognized by the Society of American Business Editors and Writers in the blog category for dailies with circulation between 200,000 to 500,000.

The judges said, "Daykin’s aggressive reporting and accessible, explanatory writing make him a must-read for his tight-knit and highly engaged audience."


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