What'll you have? Pabst City will target the 'creative class' in Milwaukee
Measured by its physical size and dollar value, the Pabst City project will be one of the most significant real estate development ventures in Milwaukee's history. However, Pabst City's impact will extend beyond the fact that it will encompass seven city blocks or cost $300 million. Coupled with the redevelopment of the adjacent Park East corridor, the projects will extend the boundaries of downtown Milwaukee and redefine the city's presence as a regional attraction. The principals of Juneau Avenue Partners LLC are confident the former Pabst Brewing Co. headquarters complex will once again be the toast of Milwaukee.
The partners in the Pabst City project include Wispark LLC (the real estate subsidiary of Wisconsin Energy Corp.) and The Ferchill Group of Cleveland, Ohio. The minority partners are Brew City Redevelopment Group LLC of Milwaukee and TerreMark Partners of Atlanta. John Ferchill, chairman and chief executive officer of The Ferchill Group, was selected to be the keynote speaker of a Small Business Times conference on "Maximizing the Development Dollar" on Nov. 14 at Marquette University. Ferchill recently discussed the Pabst City project with Small Business Times executive editor Steve Jagler. The following are excerpts from that interview.
SBT: Could you bring us up to speed about where the Pabst City project is overall?
Ferchill: Well, we're targeting to basically start the (environmental) abatement in the winter months, have it completed in the spring of next year and start construction in the spring of next year, so that we can complete the project by the spring of 2006.
SBT: Do you have a sense, John, about how many of the existing buildings at the site will be renovated and how many will be razed?
Ferchill: Right now, our agenda is, of the (26) structures, to take four of them down and leave the other (22) up.
SBT: Which ones will be going down?
Ferchill: Well, the silos, because we need parking. And the building on the corner of 10th (Street) and Juneau Avenue. That will be deleted. There's another building, just a nondescript building on 10th Street between Winnebago (Street) and Juneau. We'll also be tearing down what is now the warehouse storage building on between 9th & 10th on Juneau, to build a parking garage there.
SBT: As you've gotten in there, have you uncovered anything remarkable, in terms of architectural or historical remnants from the site's brewery past? Anything weird or unusual at the site?
Ferchill: I'm not sure any of it's wonderful, but a lot of weird things. I think really, it's kind of what we expected, you know? We've got tanks we've got to take out. We've got a lot of stuff like that we're doing.
SBT: Will the Pabst brand, itself, be central to the marketing of this development project?
Ferchill: No, not really.
SBT: It's more of a historical reference?
SBT: Looking at the sketches of the project, you've created a vision of what this thing will look like.
Ferchill: We've hired a company out of Boulder, Colo., called CommArts. They are helping us craft a vision of what we think can and can't go there, OK? I don't know what term you want to use, but they're basically helping us create the environment.
SBT: As I understand it, you intend for Pabst City to attract what you call the "creative class." That's what you're going after?
Ferchill: Yeah. When you get into the old age, you used to build these things for some sort of an economic class. We're not really building it for an economic class. We're building it for the creative class, the people who want to live on the cutting edge, want to be involved as part of a new lifestyle, as opposed to getting in a car and driving to a suburb. They want to be able to live, work and play right in the same area, and not spend their time commuting and doing those kinds of things.
SBT: That demographic isn't really restricted by ages?
Ferchill: No. I think it's what lifestyle you choose to have. This is obviously not being geared for families with school children. You could have people who are childless or empty nesters. That's what we're looking for here. They want to be part of what would be the action, whether it's entertainment or different kinds of restaurants or that kind of (thing). We're hoping to get a grocery store in. We're hoping to get a medical facility, so this becomes a true neighborhood. That's
what we're trying to do here, is create an urban neighborhood.
SBT: You have a commitment for the Hofbrauhaus to locate at Pabst City. Do you have a commitment yet from the House of Blues to come here too?
Ferchill: We're finalizing a number of letters of intent. Hopefully, by the time we get to November, we'll have a lot of those lined up, and we'll be able to talk intelligently about what we have.
SBT: In a general sense, what kind of reaction are you getting from the national retail and restaurant chains?
Ferchill: Frankly, we've received a very good response, because you know, we have a market study that shows $500 million of retail sales go to Chicago every year from Milwaukee. We're hoping to capture that market. That's what our agenda here is, to be able to get that market.
SBT: The way Pabst City is set up, will the retailers lease the property, and Juneau Avenue Partners continue to own the property?
Ferchill: We're just doing retail leasing. It'll be no different that if you were building a regional shopping center. We'll be doing the same thing. We own the shopping center, we own the apartments, you know?
SBT: Have you had any progress in finding a movie theater developer?
Ferchill: We're doing fairly well with that.
SBT: Do you have a sense yet as far as, whoever goes in there, will it be a local movie operator or a national chain?
Ferchill: I think I'm going to avoid that question.
SBT: Fair enough. Have you had any discussions with the Harley-Davidson people about the possibility of locating a Harley museum at Pabst City?
Ferchill: We had some real preliminary discussions a long time ago and have tried to attract them, but Harley has a schedule that they're looking at. We're hoping to be able to get involved and accommodate that schedule, but we just want Harley to be downtown. We want to be part of the Milwaukee action. That's what our agenda is. That's what we
want. Harley would help everybody if they were downtown.
SBT: Aside from the museum, would you want or expect Harley to have some kind of presence inPabst City, even if it's not the museum?
Ferchill: You know, it's not really appropriate for us to discuss what Harley's thinking, because we don't know.
SBT: The Park East freeway is down. It's in rubble now. People can dream about what it ultimately becomes, but it will help Pabst City substantially, won't it?
Ferchill: It should be very beneficial to us.
SBT: Where do you stand with the tax incentive programs and credits that Pabst City will receive?
Ferchill: We're not that far along to have that discussion.
SBT: Will there be a (tax incremental financing) TIF district set up for Pabst City?
Ferchill: I assume, eventually, we'll put together a TIF plan with the city.
SBT: Are there any covenants in this project, where there are deadlines where such-and-such has to happen, or the sun sets, and the whole thing is off? Or is it just a standing agreement, where the partners own the site, and it will be developed as the market allows? Are there any deadlines where the whole thing could fall apart?
Ferchill: Not that I'm aware of.
SBT: What's been the level of cooperation from the city for you people?
Ferchill: It's smooth. We have a lot of issues to deal with in there. They're working as hard as they can to help us with all of those issues, whether they're street closings or whatever the mundane. But the city, quite frankly, has been very cooperative.
SBT: What is the breakdown of the delegation of duties between Wispark and The Ferchill Group within the partnership?
Ferchill: I mean, I'm not going to answer that. Wispark and The Ferchill Group are working on this project on a joint venture basis. Each of us does whatever we need to do to make sure the project
continues to move forward.
SBT: Going back to targeting the "creative class." That sounds very much like the audience the Pabst Farms project is targeting out in Oconomowoc. Are you approaching the same retailers? Are you bumping heads or tromping through the same forests to pursuit tenants?
Ferchill: I'm not even aware of the project.
Ferchill: I mean, I've heard of it, but I don't know anything ... What you're telling me, I presume, is true, but I have no idea.
SBT: Well, I'm sure you've got your hands full just focusing on this project. How are your projects in Cleveland and in Pittsburgh going?
Ferchill: They're fine. We broke ground on a new research building for the Cleveland Clinic, and the Heinz project is on schedule and moving along (in Pittsburgh). We're hoping to have occupants in the summer of next year, and we'll make that schedule.
SBT: Is the Milwaukee project the next significant one for you, or do you have other significant projects?
Ferchill: Basically, in this company, I spend almost 75% of my time working on Milwaukee, and everybody else is working on everything else. Besides, I have one other person in here working on Milwaukee full-time, another person working on it part-time and then we're bringing on another person to work on it full-time.
SBT: Is there something special about the Pabst City project, beyond its local historical reference, that will make it a popular regional or national attraction?
Ferchill: I mean the sheer size of 22 acres and 26 buildings - The sheer size of this thing makes it pretty simple. It's there.
SBT: It's up on a hill, too, isn't it?
Ferchill: It's up on a hill, I mean, but where can you sit in seven city blocks with one purpose in mind? I mean, it's pretty hard to do if you're a private entity, and that's the real opportunity here, that we really can create something for the whole area.
SBT: Will any of the buildings be done on speculation that you will get a tenant, or is it going to be done building-by-building as you secure tenants?
Ferchill: We're lining up tenants. We'll have the tenants lined up before we start construction.
SBT: Anything else going on with Pabst City, John, that I haven't asked you about?
Ferchill: Just that we're looking forward to creating a sense of place for this in Milwaukee. We're hoping it's a place most of the Milwaukee people will come to be entertained and be proud of, once we get it done.