Park East Development Inching Forward

Here’s a good example of the failure of a command economy.

The long-stalled Park East Square project, which Chicago developer Richard Curto wants to build on a vacant lot his firm bought from Milwaukee County, may be moving forward with the sale of a $30 million bond.

The city Redevelopment Authority is scheduled to consider the bond sale at its Thursday meeting, according to the agency’s newly issued agenda.

Curto and his partners would be responsible for paying off the debt raised by selling the bonds to investors. This proposal does not involve a city loan to Curto, but because the bonds are issued under the Redevelopment Authority’s name, they are tax-exempt. That allows Curto to borrow the money at a lower interest rate.

Curto’s firm, RSC & Associates, bought 2 acres bordered by N. Milwaukee, N. Jefferson and E. Lyon streets and E. Ogden Ave. from Milwaukee County in December 2007. RSC paid $2,725,000 for the lot, the only Park East parcel sold by the county so far.

For a bit of history, the Park East Freeway was an artery that ran from I-43 to the lakeshore on the north side of Milwaukee.  It was torn down in 2004.  The promise was that it would open up 26 acres of prime development land near downtown.  The real reason was that Milwaukee Mayor Norquist is a big “urban lifestyle” liberal and wanted to make it harder for people to travel out of the city for anything. 

The City of Milwaukee and Milwaukee County control the land.  Any chance of real development of the land was hampered when both of these government units decided to impose all sorts of onerous restrictions on any developer who might have wanted the land.  Things like prevailing wages, minority labor requirements, “affordable” housing requirements, etc. made it economically unfeasible for developers to profitably develop the land without handouts from the taxpayers. 

So here we are… five years later… and those 26 acres are a vast moonscape on the north side of downtown.  The original decision to tear down the freeway was based on fantasy projections and idiotic presumptions.  It never should have been torn down.  The over-regulation of any potential developers made any opportunity to fix the mistake highly unlikely. 

I suspect the land will be developed at some point.  It will be years from now after millions of taxpayer dollars are handed out to developers and it will be nothing of the economic boom that was promised.