CHICAGO, MILWAUKEE—An affiliate of Fulcrum Asset Advisors along with its partner Millbrook Properties, both of Chicago, recently acquired an office building and adjoining parking garage at 250 E. Wisconsin Ave. in downtown Milwaukee. Financial terms of the transaction were not disclosed, but state records show the partners paid $9.75 million to Dallas-based Lone Star Funds for the 20-story, 200,044-square-foot office building. Lone Star paid about $7.5 million for the building in 2013.
Built in 1973 and renovated in 1991, the building was about 31% occupied at the time of the latest acquisition. The new owners plan to launch an extensive building modernization program and a comprehensive repositioning effort. Dan Jessup, executive managing director, JLL, assisted Fulcrum in the acquisition. Lone Star was represented by Curt Smith of CBRE. Jessup, along with Patrick Savoie and Regina Levchets, also of JLL, will now handle leasing for the building.
“Fulcrum and our partner Millbrook are looking to invest in assets that require significant repositioning because of low occupancy and the need to complete deferred maintenance and overall updating,” says Scott M. Stahr, principal, Fulcrum Asset Advisors. “This acquisition fits the bill. Though in need of significant TLC, it is located in the heart of Milwaukee's CBD and everything that location has to offer. The building has great bones with efficient floor plates, floor to ceiling windows showcasing the tremendous views, and 9' ceiling heights.”
Primary tenants of the building include Regus, Brown and Caldwell, Regal Investment Group and Scottrade. To reposition the property, Fulcrum and Millbrook plan to add a fitness center with a bike room and shower facilities, wi-fi lounge, conference center and attached covered parking. Renovations will include remakes of the main lobby and entrance, the common corridors and restrooms and an elevator modernization.
This could be an opportune time to make a downtown investment, according to Colliers International. “Downtown is becoming more attractive because of the amenities the area has to offer and the convenience of a shorter commute because of the plethora of housing options opening up,” the firm said in its most recent market report. “Metro Milwaukee has seen heavy hitters like Baird, Chase and Wells Fargo make the move downtown as millennials are entering the workforce. We have seen the most movement to CBD by industries like tech and financial firms that are looking to have that competitive advantage in the marketplace.”
Many companies have shown a lot of confidence in the CBD. Northwestern Mutual Life Insurance is building a new 32-story, 1.1 million square foot office tower, and Johnson Controls plans to construct a 50-story, 1.2 million square foot corporate headquarters. Furthermore, according to JLL developers are repositioning more than 500,000 square feet of class B office space into multifamily.
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
