West Allis — The developer of the former Yellow Freight truck terminal had anticipated having only one tenant lined up for the two new buildings that will be erected on the site.
But the news turned out better than expected.
"We plan to have both buildings leased at the time of construction," Stewart Wangard, CEO of Wangard Partners, said Tuesday.
It's been a while since West Allis officials has seen such a facility built "on spec," referring to properties erected on the speculation that a tenant will be found afterward.
"The city has not seen an industrial spec building in 30 or 40 years," Development Director John Stibal said. "That's a huge deal."
Based on a successful project in Brookfield, Wangard Partners had faith the West Allis redevelopment at 116th and Rogers streets would quickly draw tenants. It's the location that's selling the project, Wangard said.
"It's a great central location, and the site is five minutes away from three freeway interchanges," he said. "It has some of the best freeway access in southeastern Wisconsin."
While the quality of the site was the main driver, the city's clear approach to development was certainly another, Wangard said, citing how well West Allis communicated its goals.
"Developers don't like uncertainty," Wangard said.
The financial help the city was able to offer also was part of the mix, he said, but it just offset some of the additional costs of developing the former industrial site.
"We're redeveloping a brownfield site with a building," he noted.
The two original proposed buildings would have had an estimated value of $11.9 million.
To help the redevelopment, the city is offering $14 million in New Market Tax Credits. The city created an entity to qualify for the tax credits which will yield $3 million to help pay for construction, Stibal said.
The city also obtained a $127,000 grant to help with demolition, which has already begun.
The city also has offered up to an $800,000 loan from the city Revolving Loan Fund that was created with a grant from the U.S. Environmental Protection Agency. The funds must be used to cap contaminants to make a site suitable for development.
The Common Council approved selling the land to Wangard Partners for $845,000, that includes funds to underwrite the city's demolition and environmental expenses.
Tailored to tenants
Originally, Wangard Partners proposed two buildings about the same size and totaling 160,000 square feet on the 9.2-acre site. But now one building could be much bigger.
Wangard has potential tenants interested in 40,000 square feet and 50,000 square feet and a third that wants even more than that, Wangard said. Reconfiguring the plans might delay the project coming to the Plan Commission somewhat, he said.
Wangard Partners hopes to start construction in spring with completion in 2015.
Yellow Freight closed in 2007 and in 2008, the city formed a special taxing unit called a tax incremental financing district to buy the Yellow Freight parcels and prepare the vacant terminals for redevelopment.
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