Racine and Kenosha Counties Attracting Major Developments

By Andrew Weiland
Small Business Times

As sprawl from the Chicago area continues to push north, and sprawl from the Milwaukee area slowly pushes south, more major real estate developments are being planned in Kenosha and Racine counties.

Some of the latest developments in the works include another proposed high-rise condominium building in downtown Racine, three more large industrial buildings in Kenosha and another shopping center in Pleasant Prairie.

Developer Robert Watring wants to build a 12-story, 134-unit condominium building in downtown Racine, at the southeast corner of Lake Avenue and Eighth Street. The units will sell for $250,000 to $350,000, mostly to empty-nesters from Milwaukee and Chicago, Watring said.

"We feel Racine has one of the best downtowns, that has been revitalized, in southern Wisconsin," he said. "The downtown has so much potential for the condo lifestyle. (Condo buyers) want to be able to walk downtown, shop. If (downtown Racine) gets a grocery store, I think it would be the last piece of the puzzle for a condo lifestyle. I think we have a great site for our project, gorgeous views of the lake."

Watring also is developing a nine-story, 34-unit condominium building in downtown Kenosha. That project is under construction and is expected to be complete next summer.

Watring's Racine project still must be approved by city officials, and some are asking him to redesign the building. In addition, the city's design guidelines for the area recommend buildings be no taller than 10 stories. Watring said he hopes to start construction this fall and finish the project in 2009.

However, Watring isn't the only developer planning a high-rise residential development in downtown Racine. Waukesha-based KeyBridge Development Group plans to build a $185 million development, called Pointe Blue, with 434 condos, 90 apartments, 75,000 square feet of boat storage and 50,000 square feet of commercial space on a 20-acre site northwest of Lake Michigan and the Root River. The development would include a 15-story building and two eight-story buildings.

"Pointe Blue is going to be a plus for downtown and a plus for me," Watring said. "I think I can feed off of what they do and they can feed off of me. (The condo developments) will support the commercial businesses downtown. You have to have density to support that stuff."

Sprawl from the Chicago area has led to a residential development boom in Kenosha County, and that has attracted the interest of retail developers.

Indianapolis-based Gershman Brown Associates Inc. plans to build a 364,677-square-foot retail development, anchored by Target and J.C. Penney stores, southeast of Highway 50 and 104th Avenue in Pleasant Prairie. In addition to the 126,842-square-foot Target store and the 104,175-square-foot JC Penney store, the development would include a 19,686-square-foot Petsmart store and a 50,000-square-foot Dick's Sporting Goods store. The Target store would move to the development from its current location in Kenosha at 7450 S. Green Bay Road. The Petsmart, Dick's Sporting Goods and J.C. Penney stores will be the first for those retail chains in Kenosha County. The development is planned for vacant land south of a Famous Dave's restaurant and the future site of a 5,520-square-foot TGI Friday's restaurant.

Other major retail developments that have been previously announced for the Kenosha area include a 700,000-square-foot shopping center that Quality Centers, a Florida-based developer, plans to build on 150 acres northwest of Highway 50 and I-94 in Kenosha. No tenants for the development have been announced yet, but the developer has said it would be a more upscale shopping experience than what currently exists in Racine and Kenosha counties. In addition, Brookfield-based The Simon Group plans to build a 150,000-square-foot retail development in Pleasant Prairie at the northeast corner of Highway 165 and Highway 31.

The I-94 corridor south of Milwaukee has been a hot area for industrial development in recent years. The Kenosha area has been especially active, and two more large industrial buildings are in the works there.

Chicago-based First Industrial Realty Trust Inc. plans to build a 600,000-square-foot distribution center on a vacant site northeast of 52nd Street and 88th Avenue in Kenosha, for Vernon Hills, Ill.-based Rust-Oleum Corp. The plans include room for a future 250,000-square-foot expansion of that building, said Brian Wilke, a development coordinator for the city of Kenosha. The building will occupy more than half of a 70-acre parcel of land that First Industrial purchased last year.

First Industrial regional director Peter Ginn declined to comment on the Rust-Oleum project. However, he said First Industrial is also buying another 100-acre property just to the south. The company will build another industrial park there, which could eventually have 1 million square feet of industrial space, he said.

In addition, Sacramento, Calif.-based Panattoni Development Co. recently broke ground for a new 626,784-square-foot speculative industrial building on a 38-acre site at 10100 58th Place in the Business Park of Kenosha. The building will be the largest in the 200-acre business park. Mike Prost, Sergio Chapa and Rick Delisle of Lee & Associates Chicago office are marketing the building. Later, the company plans to build another similar-sized industrial building in Kenosha.

"With low vacancy and lack of available product over 100,000 square feet, this new industrial building will give owners and tenants the opportunity to have state-of-the-art warehouse/distribution space in a facility that is easily accessible to the Chicago and Milwaukee markets," said Jason Rosenberg, senior development manager for Panattoni. "We are also planning a 650,000-square-foot facility and we are marketing an additional 13 acres for build-to-suits."

Kenosha County is a hot spot for industrial development, because of a lack of developable land in Lake County, Ill., Ginn said. As a result, growing firms located north of The Loop in Chicago that need to expand or modernize their industrial space are increasingly considering locations in Kenosha County.

"Kenosha is considered part of the Chicago metro area," Ginn said. "Everything that is available in Kenosha, people are starting to come in and take a hard look at."

Land prices in the Chicago area are driven up by the demand for office space and are significantly higher than in Kenosha County, Ginn said. Kenosha land prices are $130,000 to $150,000 an acre, compared to $250,000 to $300,000 an acre in Lake County for industrial land, he said.

Eventually, the industrial space sprawl from Chicago could push even further north. In about five years, much of the I-94 corridor in Kenosha County will be built out and more development pressure from Chicago will push into Racine County, Ginn predicts.

Another factor that could drive more development in Kenosha and Racine counties is if Abbot Park, Ill.-based Abbott Labs moves forward with its plans to build a new campus on 500 acres that it purchased at Highway 165 and I-94 in Pleasant Prairie.

In addition, plans for commuter rail service between Kenosha, Racine and Milwaukee, which is being debated by the state Legislature, could also spur more development in Racine and Kenosha Counties. Commuter rail service is already available between Kenosha and Chicago, which has spurred development in downtown Kenosha.

"We're all hoping the (commuter rail) comes in," Watring said. "It would be a major plus."

Although development is continuing at a steady pace in Kenosha County, the slumping housing market has slowed some downtown condo developments. The developers for the nine-story, 87-unit Brindisi development at 714 52nd St. and the five-story Harbor Shores development at 48th Street and Fifth Avenue recently had their conditional use permits for the projects expire.