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Milwaukee and Tower owners strike a deal

Sean Ryan
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After wrangling with the owners of the Tower Automotive property for more than a year, the city of Milwaukee on Wednesday announced plans to buy the site for $3.5 million.

Milwaukee has been negotiating with Milwaukee Industrial Trade Center, the owner of the 84-acre site at 3533 N. 27th St., since at least 2007. The site has been mostly vacant since 2004, when Tower Automotive shut down its manufacturing facilities and moved out.

Mayor Tom Barrett said it will take several years for the city to clean the property for redevelopment if the proposed deal negotiated between the landowner and the Redevelopment Authority of the City of Milwaukee is approved.

“I don’t want to create an expectation that, overnight, you are going to see a transformation,” Barrett said.

The owners of Knapp Railroad Builders Inc., Midwest Rail and Dismantling Inc. and West Milwaukee Recycling LLC partnered in 2006 to form Milwaukee Industrial Trade Center and buy the property. The site is used for concrete recycling and storage and as a location for cell phone towers, said Brian Bjodstrup, general manager for MITC.

Bjodstrup said MITC spent about $3 million on the site over the years, including some remediation and site demolition. He said the company is satisfied with the final sale agreement but would not say if MITC is losing money in the deal.

Bjodstrup said the recycling operations at Tower will continue through October, and then the partners will look into improving a facility on Lincoln Avenue.

Barrett said negotiations with MITC intensified over the last several months, but he would not specify why the city settled on $3.5 million as the purchasing price.

“It was an arm’s-length business transaction,” Barrett said, “give and take and lots of wrangling from both sides.”

During last year’s court hearings, Rocky Marcoux, Milwaukee Department of City Development commissioner, said the city had offered $1.9 million for the property.

The sale agreement will resolve all of the legal wrangling between the city and MITC, Bjodstrup said.

Milwaukee and MITC fought an eight-month legal battle over the land last year that ended when a Milwaukee County Circuit Court ruled the city could enter the Tower site to test for environmental contamination.

The city plans to create a $15 million tax-incremental financing district to help pay for the cleanup.

Milwaukee has already set aside another $10 million for the effort, Barrett said. He said the plan is to bring new employers to the site, much like the city did in redeveloping the Menomonee Valley into an industrial park. The city will organize public hearings in the neighborhood to get residents’ thoughts about the property’s potential, he said.

“The neighborhood, rightfully so, is concerned and has wanted to see some activity there,” Barrett said, “whether it was initiated by the current owners or initiated by the city.”

The Joint Review Board for Tax Incremental Financing Districts in Milwaukee, which includes representatives from Milwaukee County, Milwaukee Public Schools and the Milwaukee Area Technical College, on Friday will consider the TIF plan. The city’s redevelopment authority will consider the land purchase and creating the TIF district on Tuesday.

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