COVER STORY, NOVEMBER 2004

REACHING NEW HEIGHTS
Multifamily high-rise development gains ground in midwestern
downtowns.
Lindsey Walker

Fiduciary Real Estate Development is developing Kilbourn Tower in Milwaukee.

The allure of the urban lifestyle is catching on in the Midwest. Whether it’s for the luxury amenities, the 24/7 conveniences or the worry-free maintenance, empty nesters and young professionals alike are trading in the suburban dream of yesterday for modern, high-rise condominium living in the Midwest’s metropolitan cities.

“We think the market is ready for high-rise,” says Mike Comparato, Market Square Partners’ project director of the $250 million The Residences at Market Square mixed-use redevelopment in Indianapolis. The project will feature two towers with approximately 200 units each. “[The Residences at Market Square] is the first true high-end, urban-style high-rise for-sale housing in the city of Indianapolis. Most other cities of Indianapolis’ size have already begun this transition into urban lifestyle so, as usual, Indianapolis is a little bit behind the times. But, we’re trying to catch up quickly.”

Paul Dincin, principal of Tandem Developers, agrees. “There’s a lot of pent up demand.” Tandem is currently developing the approximately $55 million, 27-story Skyscape condominiums, which will break ground in spring 2005, in downtown Minneapolis. “We found that downtown Minneapolis is a very vibrant city — on the brink of becoming a 24/7 city — and there’s not much downtown housing,” he says. “We feel that with a high-rise, we could keep our prices, create some density, get some spectacular views, and address an underserved market, which is the downtown workforce.”

“There’s a trend of people moving back to more urban areas,” notes John Pitcher, director of real estate development for Opus Northwest LLC, which is developing the 90-unit Park East Tower in St. Louis. “Chicago, Boston, New York, San Francisco, all those have already seen it and have huge populations living there 24 hours in the city. [Midwest cities] really haven’t seen that kind of movement until the last couple of years. That’s really what we’re acting upon.”

“Milwaukee has been slow in developing [Lake Michigan’s] lakefront,” says Dick Glaisner, managing partner for marketing of Fiduciary Real Estate Development, developer of the 74-unit Kilbourn Tower in downtown Milwaukee. “At 33 stories, this building will be the highest condominium project in the state of Wisconsin to date.”

The 26-story Park East Tower, which is being developed by Opus Northwest, will neighbor Forest Park in St. Louis’ Central West End district.

While these developments are unique to their markets, that alone does not guarantee success. What does, however, is a unique product in a great location.

Kilbourn Tower has just that. Not only will it be the tallest building in Wisconsin, but it will also be the property on arguably the “finest single piece of land in downtown Milwaukee,” according to Glaisner. The $70 million tower, which is scheduled for occupancy in spring 2005, is located at the corner of Kilbourn and Prospect avenues in Milwaukee’s East Side neighborhood overlooking Juneau Park, the Milwaukee Art Museum, The Bradley Center and the Marcus Center. The tower also features expansive lakefront views. “In our business, it’s location, location, location — with an exclamation point,” Glaisner says.

Situated on 10 contiguous acres in downtown Indianapolis’ Market District, The Residences of Market Square also takes advantage of a good location. The project will go up in three phases during a 4-year period, with construction of the first phase — which includes the first tower and two mid-rise buildings — beginning this month. Completion of this phase is set for 2006. The Residences is located at 251 E. Ohio Street in the middle of the Central Business District (CBD). “[The Residences] have everything you need in a true urban, pedestrian-oriented environment, a la Atlanta, Chicago and Midtown Manhattan,” Comparato says. “We are truly creating an environment that’s within the CBD that will allow for residents to be totally pedestrian oriented if they choose to be.”

The 250-unit Skyscape condominium tower takes advantage of the CBD as well, with its location a mere four blocks from the main commercial high-rises in downtown Minneapolis. “It’s in a neighborhood called Elliot Park, which is a real residential neighborhood,” Dincin says.

Park East Tower also combines a great neighborhood location with a distinctive product. “It’s the right product at the right time in the right location,” Pitcher says. Located in St. Louis’ artsy Central West End district at the corner of Euclid and Laclede avenues, the 26-story, 300,000-square-foot tower is surrounded by shops, restaurants and entertainment. The high-rise also is only one block away from Forest Park, one of the largest city parks in the country featuring approximately 1,300 acres with an art museum, a zoo, a golf course, a tennis center, an outdoor theater and an indoor botanical garden. “It’s got everything you’d want,” Pitcher says. “It’s a great amenity to the project.”

And, according to Pitcher, amenities are a must-have in modern high-rise development. “Developers have to provide full amenities for people,” he says. Park East Tower, which is set to break ground this month, will feature a pool, a media room, a club room, a fitness area, approximately 8,000 square feet of retail and enclosed indoor parking when its complete in the summer of 2006. “Another amenity is the skin of the building,” he adds. “It’s basically a window-wall building, so when you step up to the 20th floor, you have a beautiful view of downtown St. Louis in one direction and a beautiful view of the park in the other direction. There’s not much here in St. Louis that would equal that.”

Tandem Developers is developing the 27-story Skyscape condominiums in downtown Minneapolis.

Skyscape’s sixth-floor green roof creates the building’s amenity area, Dincin says. Featuring a sundeck, lawn bowling, a hot tub and an outdoor firepit, Skyview Park, as it’s been dubbed, will “be a place to meet people and have a good time and play,” he says. Sliding glass doors connect Skyview Park to an indoor amenity area with a fitness club and Sky Lounge, which has state-of-the-art media equipment, a pool table, a kitchen and a wireless Internet café. The tower, which was designed by Bob Bistry of Built Form, also has 11,000 square feet of first-floor retail. “We’ve created some features that will get neighbors to interact and meet each other,” Dincin says. “All those amenities combined will make it a really fun place to live.”

Kilbourn Tower will take amenities to a new level in Milwaukee by providing residents with services such as an on-site director of residential services who can coordinate anything from event arrangements to personal shopping; a fitness center; a club room; a business center; a humidor, a temperature-controlled wine cellar with a 1,600-bottle capacity; and 24-hour security.

Comparato says that security is a big draw for condominium owners. “Residents want to lock the door of the condominium and know that they have 24-hour security and they don’t have to worry about anything,” he says. Along with round-the-clock protection, The Residences at Market Square will offer concierge and valet services, a fitness center and on-site retail featuring a Whole Foods urban market, a dry-cleaners, restaurants and pubs and a salon and spa. The development boasts of The Shoppes at Market Square, which will include approximately 75,000 square feet of retail and commercial space, and The Market Commons, a landscaped 1.5-acre green space.

The future for high-rise development in the Midwest’s big cities looks bright. “There’s a point in time when real estate developers and condominium developers will do what office building and industrial developers have done, and that is build too much — which will impact the viability of purchase in the future,” Pitcher says. “But, as of right now, it’s a very good market.”

Comparato agrees. “People truly want to own where they have the convenience of the urban lifestyle.”

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