The city of Oak Creek is working to free up millions of dollars for road work and incentives to prod along development near the newly opened Ikea near Interstate 94.
The plan would enlarge a Tax Increment District that the city had previously established for the Ikea property in order to lay the groundwork for developments that city officials expect could ultimately be worth more than $100 million. Expanding the TIF district would give Oak Creek $2.5 million for infrastructure work and an additional $14.5 million that could be used for development incentives.
City officials expect the area near the West Drexel Avenue interchange to soon see a good deal of growth, and Oak Creek is trying to position itself to encourage projects that will set the city apart, said Doug Seymour, Oak Creek director of community development.
“Ultimately the goal is to support the growth of this key commercial and residential gateway,“ Seymour said.
The TIF plan would expand the existing IKEA district from about 50 acres to more than 125 acres, according to project documents. TIF districts allow local governments to use additional tax revenue generated by new development for public improvements such as infrastructure work, or development incentives.
Two big developments near the Drexel interchange are already underway. In April, the Illinois-based company Wingspan Development Group announced plans to build a $57 million, 300-unit apartment complex on 33 acres east of I-94 and north of West Drexel Avenue. City officials are also working with the Brookfield developer Somerstone on its so-called Highgate Center, a 28-acre project south of Drexel that would be the site of a Froedtert & Medical College of Wisconsin clinic.
To accommodate future development, Oak Creek would extend its Ikea TIF district, which the city approved in 2016, to finance new infrastructure work needed to attract growth. The biggest of these infrastructure projects would expand West Drexel Avenue and South 13th Street, Seymour said.
A larger TIF district would also give the city more cash to provide incentives for future development. Although the area near Ikea is already poised to see growth, city officials want projects that are not “typically suburban” retail developments in order to set Oak Creek apart from other places, Seymour said.
The area near Ikea has seen a big increase in traffic since the retailer opened last year.
The project cleared its first hurdle last week, earning an approval from the Oak Creek Plan Commission. It’s up for a vote again next week, when it will be considered by Oak Creek Common Council.
“We have aspirational goals for the TIF district,” City Administrator Andrew Vickers said during last week’s plan commission meeting. “We have aspirational goals for the area south of Ikea.”