The Business Journal of Milwaukee: Credit malaise postpones projects around Bradley Center
What is happening with the Park East? This is a question I hear on a regular basis. The volatility of the stock and credit markets may be one reason why nothing has been built on this prime piece of real estate. All of the projects proposed for the Park East have been postponed by at least a year because of the tight credit markets. Many real estate developers are having a difficult time securing money in this market.
Rich Kirchen, writer for The Business Journal of Milwaukee, features two Park East projects that have experienced such delays.
Gatehouse Capital, lead developer for The Residences at Hotel Palomar, is proposing to build a hotel-condo at a cost of $145 million. Principals for this project were hoping to break ground in November. Now, they are hoping to break ground in later 2009 or early 2010.
The Bradley Center’s Board of Directors hired Lauth Property Group, an Indianapolis-based firm, to propose a 500,000-square-foot retail and entertainment center that will be built just north of the arena. Despite the delay, Lauth is still focused on planning for the development and meeting with city officials and possible retailers. Similar to Hotel Palomar, Lauth is now expecting to break ground on this entertainment complex in 2010.
I don’t question the reasoning for tearing down the Park East Freeway Spur. I feel that the spur alienated the neighborhoods located just north of downtown which limited their ability to add value to the city. Since the razing of the spur, Halyard Park, Brewers Hill, and the “Bronzeville” District have grown into some of the most desired, affordable neighborhoods to live and work. The Park East will be developed some day. With its proximity to I-43, Bradley Center, downtown, and “The Brewery” neighborhood, this area will become a destination by itself. In real estate, timing is everything. Unfortunately, this brilliant plan came a few years too late.
What do the delays mean to downtown Milwaukee?
The Park East was supposed to be a destination by itself. With its proximity to the Bradley Center, this newly-created area would have been an economic powerhouse. It still can be a success, but we need to see ground-breaking events. Without any ground-breaking events, this prime real estate will continue to sit dormant.
Most condo sellers in downtown are not impacted by the delays of the Park East hotel-condos. The hotel-condos of the Park East are in a class by itself. At a starting price of $400-per-square-foot, there isn't a market already established to compete. However, I believe these delays will help other high-end luxury projects, such as The Breakwater, Terrace Row, Kilbourn Tower, and University Club.
Kirchen explains the reason for the Park East delays and the impact the delays have on two key projects. Click here to read the entire article>>>
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Labels: Economy
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