The Class A office space market in downtown Milwaukee continues to show strength, and the vacancy rate dipped from 8.2 percent at the end of 2007 to 7.9 percent as of March 31, according to a new report from Boston-based Colliers International.

Downtown Milwaukee has an inventory of 6.8 million square feet of Class A office space, according to Colliers International. The company's local affiliate is Milwaukee-based Colliers Barry.

The downtown Milwaukee Class A office space vacancy rate is better than the national average of 9.1 percent, according to the Colliers report. The highest downtown Class A office space vacancy rate in the country is in Ft. Lauderdale, Fla., with a 22.3 percent vacancy rate. The lowest is in downtown Charlotte, N.C., with a 0.7 percent vacancy rate, according to the report. Chicago has a downtown Class A office space vacancy rate of 12.6 percent.

However, the vacancy rate for all of Milwaukee's downtown office space rose a bit in the first quarter, from to 14.9 percent from 14.6 percent. The national downtown office space vacancy rate is 11.0 percent.

Downtown Milwaukee has a total office space inventory of 16.8 million square feet.

In the suburbs, Milwaukee has a 11.5 percent office space vacancy rate, which has held steady since the end of 2007, but the Class A office space vacancy rate fell from 16.2 percent at the end of the year to 14.3 percent at the end of the first quarter of 2008.

Nationally, the suburban office space vacancy rate is 13.8 percent and the suburban Class A office space vacancy rate is 13.1 percent, according to the Colliers report.

The Milwaukee area has 40 million square feet of suburban office space and 7.1 million square feet of Class A suburban office space.

For industrial space, the Milwaukee area's vacancy rate held steady during the first quarter of 2008, remaining at 7.4 percent, according to Colliers International, which forecasts that vacancy rate, absorption and rents for industrial space in the Milwaukee area will remain the same during the next quarter.

The Economy Inn, a 30-room motel located at 7284 W. Appleton Ave. in Milwaukee's central city, may be forced to close. The motel's hotel/motel license is up for renewal. The city's Licenses Committee will meet today to consider its renewal. However, the City Department of Neighborhood Services (DNS) has recommended that the license not be renewed.

"(The motel) is operated in such a manner that it generates complaints from neighbors relating to, but not limited to, loud and raucous noise, undesirable activities of guests, and has a substantial adverse effect upon the health, safety, convenience and property interests of the surrounding neighborhood," said Martin Collins, DNS commissioner in a letter to City Clerk Ronald Leonhardt.

Since January 2006, Milwaukee Police have responded to numerous calls at the motel for allegations of sexual assault, battery, armed robbery, fighting, theft and other alleged crimes. The motel has also received citations for building code and fire code violations during that time.

The owners of the motel, Harjinder Singh and Harpeet Khangura, say they are working to clean up the motel and eliminate the problems. They say they took over full ownership of the business in September, buying out a partner. They moved from California to take on full control of the motel. Since then, they say have cleaned the motel, re-painted the building, replaced the old furniture with new furniture and have worked to bring the building up to code.

"The place is clean," Singh said. Also, at the request of Ald. Michael Murphy, they closed the motel bar in March. Singh and Khangura say they have dramatically reduced problems at the motel since they took it over in September. They recently received a $1.1 million loan, backed by the U.S. Small Business Administration, from Community Bank & Trust, for the business.

Chef Michael Feker announced recently that he has closed the Walker's Point Il Mito restaurant and will focus his business development and growth on his Wauwatosa Il Mito Trattoria & Enoteca, the Chef Michael Feker School of Culinary Magic, his recently launched franchising plans, and ongoing development of televised cooking segments.

At the cooking school Feker will focus on private cooking classes, dinners and events at his Chef's Counter, plus corporate team building events and neighborhood luncheons. He is also actively involved in the marketing of his first few franchises.

"I am very excited about the tremendous feedback and interest I'm getting in response to my Wauwatosa location and the cooking school," Feker said. "Now with franchise plans in place, I need to be able to really focus on continuing to grow the Il Mito concept. It is very hard for me to let go of the Walker's Point location, but I know in the long run this is the right decision."

Irvine, Calif.-based Claim Jumper Restaurants LLC will open its first Wisconsin location at Brookfield Square Mall on June 2. The "upscale casual" chain restaurant is inspired by California's Gold Rush history. The menu features American cuisine. There are 45 Claim Jumper restaurants in the West Coast and parts of the Midwest. To celebrate the restaurant's inaugural weekend, Claim Jumper will host a grand opening event from June 6-8, during which 10 percent of all dinner proceeds will be donated to Wheaton Franciscan Cancer Care-Elmbrook Memorial.

Postal Service buying Oak Creek site
The United States Postal Service announced recently that it has agreed to purchase a 64-acre site from Milwaukee-based Cobalt Partners, which assembled the property located southwest of Howell Avenue and College Avenue. The sale price for the property was not disclosed. The Postal Service will build a new, 820,000-square-foot mail distribution and processing center on the site. The facility will replace the mail distribution and processing work down at the U.S. Postal Service facility at 345 W. St. Paul Ave. in downtown Milwaukee. About 1,900 employees will move from the downtown Milwaukee facility to the Oak Creek facility. "We've outgrown our existing facility (in downtown Milwaukee)," said U.S. Postal Service spokeswoman Marge Oehlke. "This site will allow us to streamline and modernize our operations."

The new Oak Creek facility is expected to take about two years to build and is expected to open about three to five years from now. It took about eight years for the Postal Service to decide where to build the new facility. Other sites that were considered included locations in Racine County and in Johnson Creek in Jefferson County. "We certainly are very excited about the fact that the U.S. Postal Service will continue to be in Milwaukee County for some time," said Milwaukee County Executive Scott Walker.

The facility will increase traffic in the area. College Avenue, which is a Milwaukee County trunk highway, is only two lanes wide, and is in bad condition, between Howell Avenue and Pennsylvania. Walker said infrastructure improvements will be considered for College Avenue. He also said that the Milwaukee County Transit System will consider route changes in the area to serve the workers coming to the facility. The Postal Service selected the site because it is next to Mitchell International Airport, easily accessible to the freeway system and is fairly close to its current facility downtown, Oehlke said.

The site is just outside of the City of Milwaukee, Cudahy and South Milwaukee. It will attract more people to move to those areas, Oak Creek and nearby St. Francis, said Oak Creek Mayor Richard Bolender. The facility should also draw additional commercial development to the area, officials said. "It is a good thing for Oak Creek, St. Francis, Cudahy and Franklin," Bolender said. "I think this is just one of the greatest things to ever happen to the City of Oak Creek. Postal Service, welcome to Oak Creek." 

The Postal Service said it will maintain a vehicle maintenance facility, a retail post office and some administrative offices in downtown Milwaukee. In the coming months, the Postal Service will decide if those operations will remain at 345 W. St. Paul Ave., or if they will be moved to another downtown site, Oehlke said.

The Postal Service leases the space in the downtown Milwaukee building on St. Paul Avenue, which is owned by Menomonee RP LLC, whose registered agent is Jeffrey Santaga of Wauwatosa-based Hanson & Santaga S.C. Santaga could not be reached for comment. The four-story, 941,109-square-foot St. Paul Avenue building used by the Postal Service was constructed in 1967, and has an assessed value of $19.5 million, according to city records. The building is located along the north side of the Menomonee River and is next to the recently redeveloped Milwaukee Intermodal Station, which is used by Amtrak, Greyhound and other bus lines. If the Postal Service vacates the building, it could create a redevelopment opportunity for the property.

Oehlke said the Postal Service plans to abandon the parking lot along the Milwaukee River and across the river from the Historic Third Ward, where it currently parks trucks and semi-trailers. The property's riverfront location near the Third Ward could make it a prime future development site. "I think this is a win all the way around," Walker said. "We keep the Postal Service and the jobs in Milwaukee County and we get to develop another part of downtown Milwaukee."

Lauth unveils plans for development near Bradley Center
Indianapolis-based Lauth Property Group, the firm hired by the Bradley Center to develop vacant land around the sports and entertainment facility, unveiled more details about the development plans, including a draft conceptual sketch of the retail/entertainment project. "We believe this conceptual sketch shows the exciting type of development we hope to build on the site in the coming years." said Larry Evinger, first vice president of retail at Lauth. "We view this project as a destination and a focal point for activity and development in the area."

Lauth's concept includes over 500,000 square feet of retail space on 12 acres adjacent to the Bradley Center. The multi-level development will include space for major anchor tenants, junior anchors and small shops. It also features a parking garage as well as space for dining and entertainment venues. Lauth said it plans to develop the site in multiple phases. If market demand warrants, future phases of the project could include high-rise office space, a hotel, and/or residential towers.

If the project is successful it could also be expanded north into the Park East corridor. To do that the Bradley Center would have to purchase the Park East parcel from Milwaukee County, which has yet to issue an RFP for the block. The next step for the Bradley Center development project includes generating additional retailer interest and finalizing the development plan, according to Lauth. The company said it hopes to present a more detailed plan to the city in the next year.

The Bradley Center, located at 1001 N. Fourth St. in downtown Milwaukee, owns about six acres of developable land to the north and has some vacant land adjacent to the building at the corner of North Sixth and State streets. The Bradley Center wants to develop the vacant land to enhance the facility as an entertainment destination and to generate more revenue for its tenants, including the Milwaukee Bucks.

Developer selects Hunzinger to build new Derse headquarters
HSI Development Partners LLC, a Glendale-based real estate development and construction management company, announced that it has chosen Brookfield-based Hunzinger Construction Co. as the general contractor for what will be the largest project to date in Milwaukee's Menomonee Valley Industrial Center. The facility will be leased long-term to Derse Inc., a national company based in Wauwatosa that is known for making high-tech, large-scale exhibition booths. Derse plans to move its headquarters to the valley so that it can expand its operations and grow its workforce.

The 160,000-square-foot facility will be built at the gateway to the redeveloping valley, just east of Miller Park along Canal Street. The development will cost an estimated $10 million. "Hunzinger is a reliable, capable and quality builder with a century-long tradition of excellence, dependability and safety," said Ryan Schultz, an HSI principal.  "We are pleased to have them on the team for this project."

"Hunzinger will do a great job in building the forward-looking design by Eppstein Uhen Architects that incorporates numerous glass and pre-cast concrete elements," said HSI principal Brett Haney. "We believe this project will not only meet the needs of our client, Derse, but also will be an attractive addition to the valley neighborhood that demonstrates HSI's commitment to high-quality projects."

The Milwaukee Redevelopment Authority recommended the sale of 8.1 acres of valley land to HSI for $971,000, and the Milwaukee Common Council approved the sale in November. The final property transfer occurred May 22. "We are proud to have been selected to join the HSI team for this exciting new development in the Menomonee Valley, and look forward to bringing their vision to reality,” said Kevin O'Toole, Hunzinger's executive vice president.

Main Street award winners
Several area communities were honored at the recent Wisconsin Main Street awards reception in Madison. The state's Main Street communities include: Algoma, Beloit, Chippewa Falls, Columbus, Darlington, De Pere, Eagle River, Fond du Lac, On Broadway (Green Bay), Lake Mills, Lincoln Village (Milwaukee), Marshfield, Mishicot, Monroe, Osceola, Pewaukee, Platteville, Portage, Prairie du Chien, Rhinelander, Rice Lake, Richland Center, Ripon, Sharon, Sheboygan Falls, Stevens Point, Sturgeon Bay, Tigerton, Two Rivers, Viroqua, Watertown, Wausau, West Allis, West Bend and Whitewater.

This year's Main Street award recipients include: Best Façade Rehabilitation Over $7,500, Ryan Hughes, Warhawk Country LLC, 200-214 W. Whitewater St., Whitewater; Best Promotional Item, The Downtown News, West Bend; Best Public Improvement: Built Environment, honorable mention, South Mound Removal Project, West Bend; Best Downtown Retail Event, Date Nite, Sheboygan Falls Chamber-Main Street; Best Public Improvement: Beautification, honorable mention, historic building banners, Sheboygan Falls Chamber-Main Street; Best Public-Private Partnership in Downtown Revitalization, Ginny Coburn, Jerry Wendt and the City of Whitewater, Stone Stable Project; Best Creative Fund Raising Effort, honorable mention, 17th Annual Downtown West Allis Classic Car Show; Best New Downtown Business, honorable mention, Dan's Meat Market, Whitewater.

Kenosha Theatre open house and work day
The Kenosha Theatre restoration project will be have a work day and open house on Saturday, June 7th, from 10 a.m.-3 p.m. The public is invited to come and see plans and meet with members to discuss the restoration efforts underway to bring what is the former movie theater back into operation as a live performance theater. Volunteers will be provided with gloves, brooms and shovels, but are encouraged to bring their own. The Kenosha Theatre is located at 5913 6th Avenue, at the south end of downtown Kenosha. For further information about the project call 262-658-2355 or visit www.kenoshatheater.com.

Excellence in Masonry Design
Oconomowoc-based MSI General Corp. recently won the Best of Show Award in the Wisconsin Concrete and Masonry Association's 2008 Excellence in Masonry Design competition. The award was given for the Sendik's Food Market project at 5200 W. Rawson Ave. in Franklin. Bert J. Zenker of New Berlin was the architectural designer for MSI General on the project. Waukesha-based Marriott Construction was the masonry contractor and Waukesha-based County Materials supplied the concrete brick.