Downtown Milwaukee

Condo Construction Creating
Boomtown in Brewtown

by Elaine Schmidt

The tap is definitely on in downtown Milwaukee.

The flow in housing construction began in the late 1990s with mainly rental units, but that has steadily increased to a stream of condo projects.

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"There's a flight to the city today, which is quite a reversal of a trend that was about migrating away from the cities up until about 10 years ago," says John Hunzinger, president of Brookfield, Wis.-based Hunzinger Construction Co.

Data from the Department of City Development show that in the last 10 years, 6,637 downtown units, both rental and condo, have been completed, are under construction or have been proposed. They total about a $1.8 billion investment in downtown residential construction.

Of the 1,527 condo units completed since 2000, 1,332 have been added since 2002, city data show.

And, there might be more because the city's statistics are preceded by a disclaimer: "With recently completed housing opportunities being snapped up as soon as the paint dries, new projects are announced on a regular basis."

Hunzinger says his firm is currently in preconstruction on a sleek 30-story condo tower on Old World Third Street called the Moderne. The 393,405-sq-ft structure is slated for mixed use and includes retail, hotel and 79 condo units. It also is among the newly planned structures not included in the city's figures.

Proposals for yet more downtown condo towers made the local news recently. They include the $70 million First Place on the River, a 12-story, 185-unit building; The Terraces on the River, a three-building, 130-unit complex; and River Residences, a seven-story, 80-unit condominium.

What's Behind Condo Boom?

"There are lots of buildings and land available in Milwaukee," says Mike Fabishak, CEO of the Associated General Contractors of Greater Milwaukee. "Money is cheap right now and you have a lot of people who want to be downtown. All those moons are in alignment."

He points out that when the trend in urban living began to pick up speed about 10 years ago, there was a cautious attitude on the part of most developers.

They tested the waters with downtown apartments.

As people began moving downtown, restaurants and shops began to follow-and so did the condos.

"You need the residential to beget commercial," Fabishak adds. "Then, commercial begets more residential."

Units are popping up on the Beerline on the north side of downtown to Library Hill on the west end and the Third and Fifth Wards to the south. They are ranging in price from the $150,000 to $4 million.

Fabishak pointed out that while some of the new condo construction is on the lower end of the price spectrum, the bulk of what's coming online these days is above $250,000.

"These are people with some money who are moving in," he says. "So now you're seeing wine shops and boutiques coming in, too."

Gen-Xers, Empty Nesters and Flatlanders

The folks buying into the newly created condo communities represent an interesting demographic cross section.

"You've got empty nesters and Gen-Xers coming in," Fabishak says. "Really, it's a systemic shift in the way people are approaching urban living."

Andrea Rowe Richards, communications manager for Milwaukee's Department of City Development, agrees.

"We are seeing a mixture of young professionals who want to be close to where they work and empty nesters who are returning to the city," she says.

"They feel they no longer want to maintain a large house and yard and they want to be close to the cultural amenities they come into town for."

She added that the city is also seeing some interest from people in Chicago who view Milwaukee as a weekend getaway, citing the Riverwalk that is equipped with boat slips as part of the big-city/small-city appeal.

"It's cheaper and easier to keep a boat here than in Chicago," she adds.

Contractors Kept Busy

From a construction perspective, the condo boom is providing a welcome base of work, but it's not without its challenges.

"It's great to have all these projects going on," Hunzinger says. "As the tide rises, everybody gets a little busier, and of course some of these projects will go through several fiscal years so they are keeping some companies pretty busy."

In addition to the Moderne, Hunzinger's docket includes the Park Lafayette, a 569,741-sq-ft, 20-story, all-residential structure housing 282 units, 10 town homes and 448 parking spaces.

Hunzinger says the toughest part of the condo boom "is the customization that can occur in the individual units. For us it's a matter of trying to manage that process and bring the units online while meeting the developer's and buyer's expectations."

Creating space for retail and services such as medical and dental offices has created a secondary boom in the renovation/rehab of older city buildings.

"People are taking downtown A-minus office buildings that have sunk to B-minus or C and rehabbing them as offices or for other uses," Hunzinger says, adding that the rehabbing trend is particularly strong in the Third Ward, just south of downtown.

South of the Third Ward, the city's Fifth Ward is a completely different landscape than it was 10 years ago. New condo buildings and rehabbed older structures housing coffee shops, jewelry stores and antique dealers have transformed a tired, industrial area into a thriving community.

Hunzinger says there is some concern over how long the momentum of condo boom, and the entire downtown redevelopment boom, can continue, but the entire Park East redevelopment has yet to happen.

The Park East corridor is the stretch of now-fallow land created when the city razed the old Park East Freeway spur, which reached from Interstate 43 to the north end of downtown. The Park East Freeway was part of a wildly controversial, partially built but ultimately doomed freeway system.

Demolition of the Park East got under way in June 2002. Today, its former footprint holds a new boulevard and cross streets and several vacant city blocks.

"There's stuff on the drawing board that may or may not get built," Hunzinger says. "The city hasn't figured out how to get behind these projects, not wanting to be seen as playing favorites."

There has been a bit of activity in the Park East recently. The Flatiron, a 10,000-sq-ft, $10 million condo building, is under construction on the east edge of the area, by developer Legacy Real Estate. It will include 38 condo units in a wedge-shaped building that is tailored to the corner lot between two oddly angled streets.

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