The North End Condominium and Apartment Homes in Milwaukee Wisconsin

$8.2 million in city funding proposed for The North End

(Published November 21, 2006)

The Department of City Development proposed Tuesday $8.2 million in city financing for a housing and retail development just north of downtown - paving the way for what would be the largest project within Milwaukee's Park East area. The city's funds would help finance Mandel Group Inc.'s $175 million project, known as The North End. The development is planned for 8 acres overlooking the Milwaukee River, on the former Pfister & Vogel tannery site.

Mandel plans to create 395 condos, 88 apartments and 20,000 to 25,000 square feet of street-level retail space over the next five to seven years. The firm hopes to begin demolition and environmental cleanup work in December, with new construction beginning by next summer, said Richard Lincoln, Mandel senior vice president.

The North End's $65 million first phase would feature 109 condos, 88 apartments and 12,500 square feet of retail space in six separate buildings, some as high as 10 floors, and include a two-level parking garage. Construction on that phase, south of E. Pleasant St., between the river and N. Water St., would take 18 to 24 months to complete.

The city funds, which require Common Council approval, would help pay for demolition and environmental cleanup work; new streets, a riverwalk and other public improvements, and other expenses. Lincoln said the funds, which the city would borrow, would be repaid by The North End's property taxes within seven to 10 years, according to a study commissioned by the Department of City Development.

The financing plan will be reviewed Tuesday by the Common Council's Zoning, Neighborhoods and Development Committee.

The North End would amount to a huge investment for the city's 64-acre Park East redevelopment area. That area includes privately owned parcels, and 16 acres of county-owned parcels left vacant when the former Park East Freeway was demolished.

The former freeway stub's demolition was completed in 2003. That was followed by delays on selling the county-owned parcels until a debate was resolved over whether to create certain conditions for developers. That included a requirement that they pay prevailing union wages for construction work on county-owned parcels.

That matter was resolved in February 2005, when the County Board overrode County Executive Scott Walker's veto of those development guidelines. The marketing of the county-owned parcels began shortly thereafter.

There are two major projects in the development stage on the county-owned lands.

Chicago-based RSC & Associates plans to develop apartments, retail space and two hotels on two blocks bordered by N. Jefferson St., N. Broadway, E. Lyon St. and E. Ogden Ave. Also, Ruvin Development Inc. and Dallas-based Gatehouse Capital Corp. plan to build a hotel, condos, offices and retail space on a block bordered by N. Old World 3rd and N. 4th streets and W. Juneau and W. McKinley avenues.

Projects on privately owned parcels include The Flatiron, a 38-unit condo building under construction at 1541 N. Jefferson St.

The nation's slowdown in the housing market has not affected demand for downtown condos, Lincoln said.

Mandel has received around 150 inquiries about The North End, even though the firm has not yet launched a marketing campaign, Lincoln said.

Some of The North End condos will be smaller units, priced as low as $165,000 to $175,000. Most of the units will likely sell for $350,000 to $375,000, Lincoln said.

The city financing plan is not the only public funding for The North End.

Mandel is receiving a $1.1 million low-interest city loan, funded by federal grants, to help with the environmental cleanup. The project also landed a $900,000 state cleanup grant.

The site is the largest polluted parcel in the downtown area, according to Mandel Group. The previous owner, U.S. Leather Inc., went bankrupt, abruptly closed the tannery six years ago, and cannot be billed for the cleanup costs, said Barry Mandel, Mandel Group president. Mandel bought the former tannery in 2001 for $3.4 million.