CDE: First-Ring Industrial Redevelopment Enterprise

Developer Wangard Partners had some fun naming their acquisition, construction, and leasing of two industrial buildings encompassing a site of approximately 170,000 square feet on Rogers Street in a highly distressed area of West Allis, Wisconsin: they named their project Mr. Rogers’ Neighborhood. The project site is in a designated Brownfield intervention area and local tax incremental financing district. A longstanding goal for redevelopment by the City of West Allis, the site struggled to balance the cost of construction and competitive lease rateswithout access to NMTCs.

Ferguson Enterprises Inc., a plumbing supplies company, leased a 72,000-square-foot building in the project. A second, 50,000-square-foot facility was built speculatively. Total project costs were more than $13.8 million. First-Ring Industrial Redevelopment Enterprises, Inc. (FIRE) provided $14 million in NMTCs and PNC New Markets Investment Partners, LLC bought the credits and provided more than $4.4 million in capital to the project. Pyramax Bank provided the project an $8 million leveraged loan, and Wangard provided more than 1.9 million in equity.

FIRE’s controlling entity is the City of West Allis and learned of Wangard Partner’s interest in the site through regular conversations with city economic development staff. The project created 65 temporary construction jobs, with average salaries of more than $48,000. Once the project is fully leased, it is estimated to create more than 300 jobs. As part of the project financing agreement, in partnership with The City of West Allis and First Ring Industrial Redevelopment Enterprises, Inc. (FIRE), Wangard Partners structured contributions towards West Allis-based organizations.

Organizations receiving the donations promote achievement, development and community foundation programs including the Little League of West Allis ($50,000) and West Allis Community Improvement Foundation, Inc. ($20,000).

‘The project is a great addition to the City,’ added Mayor Dan Devine. Adding further, ‘the buildings will offer signature architecture for our community. I am proud of the partnership our City has established with Wangard Partners, Inc.’

Super Steel, LLC, formerly known as Super Steel Products Corporation (SSPC), has been in existence since 1923, providing contracted manufacturing services to customers in the industrial, construction, agricultural, and defense markets, and specializing in providing metal fabrication to the rail industry. Despite its long history, the Milwaukee, Wisconsin based company could not withstand the economic recession and was forced to file for receivership in 2010. The closure of the company would have meant the loss of jobs and economic activity in the region. The City of Milwaukee made saving the jobs threatened by the potential demise of Super Steel a high priority and looked for ways to keep the company afloat. In 2010, First-Ring Industrial Redevelopment Enterprise (FIRE), a CDE formed by the City of West Allis, WI, offered a solution and provided $15.5 million in NMTC financing. This financing supported the acquisition, operational upgrades, and working capital requirements for the re-launch of the company. With the re-launch, Super Steel was able to retain its 223 employees and add 207 new, permanent, quality jobs at an average wage of $36,000, the majority of which are held by low-income persons. Super Steel, LLC’s focus is on reemerging as a best in class contract manufacturer by building upon its skills in the rail industry and pursuing contracting services with leading Original Equipment Manufacturers.

This project is a refinance and business expansion request. The principals of Duracolor took over the failing graphics company in 2004. They were able to preserve a substantial number of well paying positions in the community. Over the last three years the management had been able to stabilize the company and bring it to the point where it is ready to grow.Duracolor is prepared to expand. To do this however, they need to put capital improvements into their current space and to purchase equipment that will allow them to be efficient enough to add staff without having to go to a third shift. They expect to double their employment needs. As a part of this they will also need to tap into local training opportunities – allowing them to tap community residents for these new positions which pay a true living wage (on average $15 per hour).