Milwaukee Condo & Real Estate Scene

The Business Journal of Milwaukee: Mandel to join First Place condo project - Construction, sales proceeding for troubled building

During the past year, real estate developer Scott Fergus and his company, Key Bridge Group, Inc., made the news for all of the wrong reasons. He had some very bold projects in the pipeline which included 601 Lofts, 320 Condos, and First Place on the River (First Place). Many said he had a great vision for downtown, but lacked a business plan. Now, Fergus is no longer handling any of these downtown condominium developments.

In January 2008, Fergus and Key Bridge filed for receivership for First Place. First Place is located on one of the most prime pieces of real estate in downtown - where the Milwaukee and Menomonee Rivers meet in the “Historic Fifth Ward.”

The largest mortgage holder for First Place is Madison-based AnchorBank. The bank is expected to hire Milwaukee real estate developer Barry Mandel and his company, The Mandel Group, Inc., to complete any outstanding real estate services for this development. According to the article, First Place is more than ninety percent complete. The only remaining tasks yet to be completed are the building’s lobby and installation of boat slips.


Now for the good news…

When all is said and done, AnchorBank has reassured all of the condo owners that there will not be any construction liens filed against them. Anytime there is a lawsuit, this is the biggest concern any current or potential investor has with a development.

At the time of the receivership filing, First Place had 78 residential units under contract, three closed transactions and 70 unsold units.

Since the filing of the receivership, 17 of the 78 units under contract have closed.


My take...

Although I am confident in Barry Mandel’s skills and abilities to enhance the downtown community, I’m not sure he is a miracle worker which is now needed for First Place. There are so many external factors that affect the real estate industry (e.g. excess supply, recession and inflation concerns, tightening of lending policies, etc.). In addition, Mandel has his hands full as well. The North End, although in the process of breaking ground, has had its challenges. However, if you had to hire someone to take on the financial problems of First Place, Mandel would definitely be on the short list of real estate developers to turn this development around.

Pete Millard, writer for The Business Journal of Milwaukee, writes more about the new direction for First Place on the River. Click here to read the entire article>>>


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Labels: Real Estate

posted by David Ray @ 1:05 PM