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Industrial equipment maker Rexnord in full swing on developing new downtown Milwaukee headquarters

It is likely the largest downtown Milwaukee office development about which you've heard scarcely anything.

Nearly one year ago, industrial equipment maker Rexnord Corp. agreed to lease around 150,000 square feet at 105-111 W. Michigan St. for its future headquarters.

That was according to commercial real estate industry sources, who talked to the Journal Sentinel when the property was sold in February for $14.4 million, according to state real estate records.

Neither Rexnord nor the buildings' buyer, an investors group led by developer Mike Klein, would then talk about the project.

Since then, both Rexnord and Klein, whose group is known as 111 Michigan Partners LLC, have maintained their "no comment" stance — even as work began in earnest last summer on renovating the future offices.

However, several building permits filed with the city Department of Neighborhood Services provide a fair amount of information. Those public documents routinely refer to it as the Rexnord project.

Rexnord's future headquarters is a combination of two separately constructed buildings.

A three-story building, with around 50,000 square feet, was built in 1967 on top of a seven-story parking structure overlooking the Milwaukee River, according to city assessment records.

In 1998, a five-story building, with around 100,000 square feet, was added at the southeast corner of West Michigan Street and North Plankinton Avenue.

The combined buildings for several years housed the headquarters for Extendicare Holdings Inc., which operated nursing homes and assisted living centers.

Extendicare closed its headquarters in 2015.

A portion of the buildings, then owned by Towne Realty Inc., was leased to Extendicare's successor, Fortis Management Group LLC, before it closed in 2018.

Work to prepare the vacant offices for Rexnord started shortly after Towne sold the property to Klein's group. A building permit was issued in February for asbestos removal.

That was followed by permits issued to do internal demolition work and repairs to the parking structure, which has around 700 spaces.

The main permit for renovating the offices and parking structure was issued in June.

It puts the cost of that project at $8.6 million. However, additional permits have so far added around $5.9 million to that tab.

Fond du Lac-based C.D. Smith Inc. is listed as the general contractor, and Milwaukee's Eppstein Uhen Architects is the project architect.

The plans filed with the city called for major renovations, including new, larger windows, new finishes for both the interior and exterior, and a new stairway.

They also show executive offices, a board room and amenities, including a fitness room, on the top floors at the 105 W. Michigan St. building.

A January building permit features some revisions to those plans.

Those include a ninth floor "work cafe" in the 105 W. Michigan St. building.

They also call for a lobby, training rooms, break-out area, conference rooms and information technology room in the building at 111 W. Michigan St.

Meanwhile, another January permit application shows plans for a large rooftop sign with the Rexnord name. The lighted sign will be nearly 10 feet tall.

 

Additional permits show other upgrades.

They include a new fire protection system, a revolving door for the lobby, plumbing improvements and a new heating, ventilation and air conditioning system.

Also, the elevators are being modernized.

The plans don't say how many employees Rexnord will have at its new headquarters.

Rexnord's main Milwaukee-area corporate offices are at 4701 W. Greenfield Ave., West Milwaukee.

Its smaller corporate headquarters, featuring offices for President and Chief Executive Officer Todd Adams and other top executives, is at 511 W. Freshwater Way, in the Reed Street Yards business park.

That building is mainly used to house Rexnord's Zurn Industries LLC division, which will remain at Reed Street Yards.

Zurn, which makes commercial plumbing fixtures, had 85 employees at those offices as of March, according to the Department of City Development.

Zurn must have 120 employees there by March 2021 to avoid repaying a forgivable city loan used to help finance that building. It was completed in 2016 and used to relocate the company from Erie, Pennsylvania.

Rexnord also makes aerospace parts, conveyor systems and other industrial equipment.

The company, as of March, had 6,700 employees worldwide, including around 3,400 U.S. employees, according to its latest annual report.

That report doesn't break out how many of the jobs are at the West Milwaukee offices.

But the downtown headquarters could eventually total up to nearly 500 jobs, two commercial industry real estate sources have told the Journal Sentinel.

The renovated buildings, and their parking structure, could accommodate that number.

Rexnord wants to move white collar jobs to downtown Milwaukee to make it easier to retain and recruit professionals, one source said.

That factor has been cited by several other Milwaukee-area companies that have moved office jobs to the downtown area in recent years.

The newest relocation occurred in late December when Graef USA Inc. opened its new headquarters at The Avenue, at the former Grand Avenue mall, 275 W. Wisconsin Ave.

Graef, an engineering, planning and design firm, also is working on the Rexnord project.

The city building permits also don't say when the office renovations will be finished.

But a project of that size can typically take about a year to complete. That would suggest a relocation of Rexnord's offices to downtown by late summer or early fall.

Rexnord posted revenue of $1.03 billion during the first six months of its current fiscal year, which ends March 31. Its net income totaled $91.5 million.

Tom Daykin
Milwaukee Journal Sentinel

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