Midwest Real Estate News February/March 2014 : Page 1

MINNESOTA | MISSOURI | NEBRASKA | OHIO | TENNESSEE | WISCONSIN THE DAKOTAS | ILLINOIS | INDIANA | IOWA | KANSAS | KENTUCKY | MICHIGAN FEB-MAR 2014 VOLUME 29 ISSUE 07 WWW .REJOURNALS.COM Building A Downtown Heart In Oak Creek MULTI-FAMILY FINANCE Financing: It’s getting easier for multi-family lenders to earn financing today By Dan Rafter, Editor The public-private partnership between WISPARK and the city has made the project possible, Franke said. “The city really has been progressive when it comes to this project,” he said. The year 2015 will be a big one for the development. The Meijer store is expected to open then, as is the site’s hotel, a Four Points by Sheraton. Drexel Town Square isn’t the only big project WISPARK is taking on in Oak Creek. There’s also the OakView Busi-ness Park, a business park that WIS-PARK is developing on a 260-acre parcel owned by the Milwaukee Metropolitan Sewerage District. This development will include a mix of manufacturing, light industrial, office and service uses. Franke said that WISPARK hopes to begin construction of the business park’s buildings later this year. Current-ly, the company is tackling mass-grading and installing infrastructure on the site, he said. “There is a connection between Mil-waukee and Chicago. The southern part of the Milwaukee area is emerging as a desirable location for development,” Franke said. “This is part of that trend. This area is closer to Chicago. It makes sense for the Milwaukee area to grow closer to Chicago rather than grow clos-er to Madison.” ike many suburbs, the city of Oak Creek in Wisconsin is missing one thing: a walkable downtown. And today, that’s a negative. Companies look for pedestrian-friendly downtowns when deciding where they’ll move. Families do the same. That’s why the new Drexel Town Square mixed-use development is so important to this Milwaukee suburb. Milwaukee-based developer WIS-PARK — in partnership with the city of Oak Creek — has spent the last year cleaning up the site that will soon be home to Drexel Town Square. This hasn’t been easy. The site was the former home of a Delphi manufacturing plant. To turn this into a mixed-use development featuring shops, restaurants, a new city hall and a public library required plenty of clean-up. Today, WISPARK is focusing on mass-grading and installing infrastruc-ture on the site, something that will wrap in October of this year. Construc-tion on the new city hall, a hotel and library should start in April. The goal? To turn Drexel Town Square into Oak Creek’s first walkable down-town center. “All of the professionally designed urban spaces identify downtown areas as the heart of the community,” said L Jerry Franke, president of WISPARK LLC. “And having worked in established communities where there are central downtowns, it does make a difference when families are looking to locate in a community. It makes a difference when companies are looking to find a new home. The downtown can give a com-munity its identity.” Creating a new downtown isn’t cheap. The Drexel Town Square project is ex-pected to cost $162 million. Oak Creek, though, will be getting plenty for this money. The 85-acre project will include the library and city hall, of course, but also a 191,000-square-foot Meijer store on the eastern end of the project site. The proj-ect will be divided into two main parts. There’ll be a traditional town square with luxury apartments, a fitness facility, retail and restaurants. Then there is the eastern end of the project which will look more like a suburban retail center. This will include the new Meijer store and several outlot retail buildings. “We could not fill up the entire parcel with the town center,” Franke said. “That would have been too large. The financial feasibility wasn’t there.” Franke gives plenty of credit to the project to the city of Oak Creek itself. T he multi-family market remains a strong one in the Midwest, with new projects ris-ing in markets from Minneapolis to Chicago to St. Louis. But what do developers need to do today to receive funding for their new apartment projects? Midwest Real Estate News recently spoke to Mike Jehle, vice president at Arbor Commercial Mortgage, and Tim Larkin, senior vice president with Minneapolis’ Dougherty Mortgage, about the steps lenders need to take to qualify for financing for their new apartment projects today Tim Larkin Midwest Real Estate News: What do lenders need to show developers today if they want to qualify for financing for multi-family projects? Tim Larkin: No matter how you look at it, it is the income-producing real estate that is the key. It is FEATURE (continued on page 14)

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