Hybrid development key to DTS success

WISPARK LLC President Jerry Franke provides answers to questions about the Drexel Town Square development project.

Q. From the outset of this project you’ve referred to DTS as a “hybrid” development. What does that mean in the commercial real estate world?

A hybrid development combines contemporary suburban-type retail with a more traditional Main Street or Town Center concept. The outlot sales that have been reported recently and future ones that will be announced are so critical to the overall project. We could not have developed a Town Center without the sale of outlots framing the property around the Meijer Store. The revenue from the sale of these parcels and the resulting increased real estate values for the TIF district helps to fund or support the development of the Town Center.

The relationship doesn’t stop there. Consumers who visit the retail outlots may be drawn to visit the Town Center where we will have smaller, more boutique-like shops. And, the residents who live in the apartments that will be in the mixed-use area of the Town Center likely will patronize the businesses located on the outlots.

Q. The mix of various entities within the DTS site should be a draw and create a lot of traffic.

That’s true. Traffic in a good sense. Froedtert’s medical center will have employees on site every day as well as patients visiting the center. In addition, a fitness center, upscale apartments, Meijer, Chick-Fil-A, Water Street Brewery and PetSmart all will generate traffic. We continue to market this outstanding development to similar, quality retailers to support the hybrid development concept. A mix of national and regional credit tenants with less well-known local retailers will provide the financial viability needed for a successful project.

Also, a major benefit from the Froedtert project will be the addition of 250 well-paying jobs, making it both a redevelopment project and an economic development project. Medical care is one of the largest components of our nation’s economy.

You’ve also mentioned mixed-use. Tell us more.

Mixed-use is popular in urban settings where there are retail spaces on the street level with offices and/or apartments in the upper levels. This approach is successful in parts of a city where former warehouses or similar buildings are renovated. Milwaukee’s Third and Fifth Wards are excellent examples of mixed-use where empty buildings have been brought back to life. Drexel Town Square’s Town Center will provide a mix of retail and restaurants on the street level along with apartments on the upper levels.

Q. What’s the status of the retail environment?

Retail continues to change as competition grows. There are developments like DTS throughout southeastern Wisconsin and northern Illinois competing for retailers. It’s difficult to lease retail space off of plans. Retailers want to see the developed area. Having said that though, we already have 35 percent of the Main Street retail space leased. Due to competitive reasons, we can’t release the names of these retailers quite yet. We are confident there will be numerous announcements this summer as the actual construction of the buildings proceeds.

We’re confident that the retailers west of Delco Drive (adjacent to the location of Petsmart) will attract people to walk to the stops along Main Street. The customers can park at PetSmart and walk to the other shops from there.

Q. The weather this past winter was not conducive to outdoor construction work.

That’s true. The cold winters and wet springs/summers of the past two years have been a challenge and we’re 14 months behind schedule. We thought we would have the infrastructure completed by year end 2014 but that is not the case. We expect to have it completed by this summer. The good news however is that we closed on the sale of the land for the Main Street buildings being developed by WIRED and the land for the Barrett Visionary Development’s first phase. Construction will begin this month. These include apartment buildings with 147 and 64 apartments, respectively. Main Street also features 37,000 square feet of retail on the first floor. See our previous announcement about the luxury apartments here.

Q. You mentioned PetSmart. Tell us about that outlot.

A PetSmart store will be part of the variety of retail shopping options within Drexel Town Square. The 12,250-square-foot store, a component of a 16,250-square-foot building that will be developed by Thompson Thrift Development, will be located at 320 W. Town Square Way. It will be accessible directly from Drexel Avenue on the north end of the site. Pet supply sales are one of the fastest growing segments of the retail economy.

PetSmart, Inc. employs approximately 53,000 associates and operates approximately 1,404 pet stores in the U. S., Canada and Puerto Rico.