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The Condo Crunch
Looking for a new Downtown condo? Get in line.

Photo by Ryan Schmitz

Don’t believe there’s a condo shortage in Downtown Milwaukee? Just ask real estate agent David Price, the self-dubbed Milwaukee Condo Man. “There’s limited inventory in every price range,” says the owner of Milwaukee Realty Inc., an East Side agency that sells Downtown units. “There are people who are mad at me because I can’t show enough in the $200,000 to $300,000 range.”

According to the Multiple Listing Service, there were 294 condos for sale in five Downtown ZIP codes in early July, including 74 with accepted offers, leaving 220 available to would-be buyers. “In 2010, there were probably 1,300 condos for sale, but people were afraid to purchase at the time,” says Jean Stefaniak, an agent with the Stefaniak Group in Milwaukee.

Now, that’s no longer the problem. “There’s a shortage,” Price says, “and it’s making the ones out there sell faster.”

The Moderne tower at West Juneau Avenue and Old World Third Street has already sold half of its condo units, including the building’s least-expensive listing, priced at $220,000. Those still available range in price from $415,000 to $2.5 million.

Lauren Siegel, an agent with First Weber Group, says the viability of a moderately priced development with high-end features, such as Sub-Zero and Wolf brand appliances, is evidenced by “the velocity with which we have been able to bring contracts to the table.”

What’s no longer popular is penthouse-style living with spacious rooms and a hefty mortgage. “Within the last three years, there [has been] a huge trend toward building smaller and smaller units, just a studio or a one-bedroom,” says Bob Monnat, chief operating officer at the Mandel Group. The Edge building, completed beside the Milwaukee River in 2009, is filled with one- and two-bedroom condos.

With a dearth of new projects, buyers are primarily choosing from preowned condos. Still, as Peter Renner of Renner Architects notes, the demand is there for new buildings. The firm designed and built the Harbor Front and Hansen’s Landing developments in the Third Ward as well as the BreakWater, which is on the East Side and has only a few units available.

But today, such developments are said to be untenable.

“It costs more to build than you can sell them for,” Monnat says, “and it’s impossible for a bank to make a loan.”

Other “shadow” condos currently occupied by renters may be opening up, however, as owners push units back onto the market. In early 2013, Mandel Group surveyed 3,120 condos within 35 Downtown properties and found that 816 (about one-quarter) were being rented, a number it predicts will fall to “roughly 500 units” within the next few years.

This new reality is a far cry from the pre-bubble boom, when construction surged between 2005 and 2007, but it’s coming up against another reality: Younger adults are settling in the city, according to Mandel’s Monnat. “None of these people are saying they want to live in Mequon.”

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