While much of the state is experiencing the same slowdown as the rest of the country, some developments in the La Crosse area of Western Wisconsin are bucking the trend.
Developers announced a $35 million project that will include a 12-screen cinema, an extended-stay hotel with about 88 rooms, one or two national chain restaurants and two or three multi-tenant retail buildings in the Onalaska retail corridor last week.
This is not the only large development in the area. Northside Development of La Crosse LLC plans to build a 128-room Hilton Garden Inn hotel and parking ramp this year in downtown La Crosse. Northside also is a partner with VEH Properties in the Onalaska development.
There are several reasons these developments are bucking the trend. First, the principals involved in the development companies are willing to cooperate and see the potential in the area. They include Paul Borsheim, Doug Stanton, Marvin Wanders, Mike Keil and Charles and Derek Kasten of Northside and Tim and Paul Eijl of VEH.
Such cooperation between firms is a wise approach in somewhat uncertain times, and can create more capital and resources than if one company tried to go it alone.
Second, the cooperation also is extending to the public sector. The City of Onalaska will create a tax incremental financing (TIF) district for the development in that community. The Hilton Garden motel will be build on a site that is now a City of La Crosse parking lot.
The developers also plan to do the Onalaska project in two phases. Construction is expected to begin this spring and completed on four buildings by fall. A second phase with three buildings is expected to be built in 2009.
This too is a wise approach and should allow a revenue stream from the first phase to help finance the second.
Onalaska will receive about $525,000 in property taxes once the development is completed. Right now, the property where the development will be built brings in about $10,000 in such taxes.
Developers also project that 250 to 300 jobs will be created by the various businesses that will locate in the development. No leases have been signed by businesses yet, but some are expected soon. Developers told the La Crosse Tribune they hope to release the names of some tenants within 60 days.
“I think this is wonderful,” Onalaska Mayor Jim Bialecki told the Tribune. “Most of the state is flat, as far as any new construction. But for this region as a whole, this doesn’t seem to be the case.”
While the two developments by Northside and VEH have gone public, others in the area are just starting to emerge. In tiny Westby, to the southeast of La Crosse, the city council passed a resolution last week to commit to a redevelopment project contingent upon receiving all the legal documents listed in a letter being drafted from the city attorney to the developers.
Developers Dorin Smalbergher, Dorene and Danny Arnautu, who are based in Chicago, are proposing a $4 million downtown development that would tear down several older buildings and construct 2-to 4-story buildings on both sides of the street.
The buildings would house an apartment complex constructed above lower level businesses that could be leased, rented or purchased, with a 10 percent discount to any existing business that agrees to utilize space in the new buildings after construction is complete.
The City of Westby would provide more than $1 million toward the project, about half of which would be recouped through some type of TIF arrangement. Westby officials are moving “cautiously” ahead on exploring the possible project.
Cautious also is probably a wise approach in the current economic climate. But, just to the northwest of Westby, you can see how cooperation, vision and a phased approach can help buck an overall slowdown trend.
