Milwaukee Journal Sentinel

New signs surface for downtown mail center redevelopm­ent

- Tom Daykin

There are new signs that the U.S. Postal Service is proceeding with longdelaye­d plans to develop an Oak Creek processing center — which would free up its downtown site for redevelopm­ent.

There’s no publicly available timeline yet for when the constructi­on would begin on the mail processing and distributi­on center on just over 60 acres at 2201 E. College Ave., southeast of Mitchell Internatio­nal Airport.

The agency has several years remaining on its leased downtown facility, at 341 W. St. Paul Ave.

But new public records show that Postal Service representa­tives met on Thursday with state Department of Natural Resources officials about the project.

The developmen­t needs DNR approval for filling 1.6 acres of wetlands at the site.

The DNR in 2009 approved filling wetlands for the mail processing center. But, after the recession, that project was placed on hold and the wetlands permit expired.

The Postal Service is now seeking an expedited permit review, according to new DNR records.

According to those records, “expansion and growth in the packaging market require new equipment and updated facilities.”

That growth includes Inc.’s new four-story, 2.6 millionsqu­are-foot distributi­on center, with up to 1,500 employees, that’s under constructi­on in Oak Creek.

That $200 million operation, to open in March at West Ryan Road and South 13th Street, will be Amazon’s largest Wisconsin facility.

Along with its Kenosha facility, Amazon may have another distributi­on center in the works for Beloit.

A Postal Service spokesman couldn’t be immediatel­y reached Tuesday for more informatio­n about the new mail processing facility’s constructi­on schedule.

Oak Creek officials have no informatio­n at this time about the project site, said Kari Papelbon, city planner.

The Postal Service 10 years ago bought the Oak Creek site, at East College and South Pennsylvan­ia avenues, to build a facility that would be more efficient than its aging downtown processing center.

The project had been on an indefinite hold with the Postal Service facing declining revenue.

Meanwhile, the downtown facility, totaling 1 million square feet, was sold for $13.1 million in 2015 to an investors group led by two Chicago firms: R2 Companies and Polsky Holdings.

In 2016, R2, led by Matt Garrison, released conceptual plans to eventually convert the building into roughly 200,000 square feet of stores and restaurant­s on the first and second floors, 500 parking spaces on the third floor and around 100,000 square feet of offices on the fourth floor.

That conversion would cost more than $100 million — which R2 would raise if it secured anchor tenants.

The Postal Service’s lease of the downtown property, which overlooks the Menomonee River, runs at least through March 2025. With options, the agency can extend the lease until 2040.

But the Postal Service could be forced out earlier.

The downtown building’s owner, 345 Property Owner LLC, in 2018 filed an eviction suit.

The lawsuit claims the Postal Service has defaulted on its lease by failing to make building repairs.

The agency denies those claims, and the suit is pending in U.S. District Court.

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