Milwaukee seeking new developer for Marcus Center parking garage

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The city of Milwaukee will seek new developers for the Marcus Performing Arts Center parking garage, according to the commissioner of city development.

The city will “move in another direction” and find a new developer to build over the Marcus Performing Arts Center parking garage at 1001 N. Water St., said Lafayette Crump, commissioner of the Department of City Development, at a meeting. DCD on Friday announced it dropped Madison-based Neutral’s proposal for a $700 million development over the city-owned lot when its project stalled nearby at 1005 N. Edison St.

A DCD spokesperson said the department won’t share names of which developers it is talking to, but confirmed it was “engaged in conversations” with several developers about the site.

Neutral, which brands itself as a health and sustainability-focused developer, had started foundation work on a hybrid mass timber apartment building when work suddenly stopped in September. Later, contractor C.D. Smith Construction filed construction liens worth more than $14 million against the company.

Some city officials expressed skepticism over the Madison development company, which is only a few years old. Robert Bauman, the alderman who represents the 4th District, said at a meeting Neutral didn’t have a track record to be considered for redeveloping the lot. The city selected Neutral in a request for proposals process in 2023.

The company didn’t have any large projects completed that year. However, it welcomed its first tenants to the 14-story Bakers Place in Madison in May. Neutral is also developing 517 W. Main St. in Madison, which will feature 33 housing units.

“It’s time to move in another direction,” Crump said at the meeting. He said he had multiple conversations with Neutral and two other respondents to the RFP, which received three viable proposals that were under evaluation. Developers could be considered without creating another formal RFP, he noted.

Crump said the department will return in the next two months with more concrete details and want a developer under contract in the next six months.

In early November, C.D. Smith filed more than $14 million in construction liens against Neutral for unpaid work on both the Neutral.Edison project in downtown Milwaukee and Baker’s Place in downtown Madison.

In September, the contractor left the project site and left the proposed 31-story, 378-unit apartment building indefinitely paused. If completed, it would have been a competitor for tallest mass timber building in North America.

Neutral characterized the halt as temporary and listed tariffs and inflation as reasons for the work stoppage. City officials later revealed a $25 million funding gap in the project, with a total construction budget of around $230 million.

In July 2024, DCD selected Neutral to redevelop the parking garage at 1001 N. Water St. The developer proposed multiple mixed-use buildings with a total investment of more than $700 million, officials said.