Port's patience with
building owner runs thin
Officials, merchants say it's time
to force property owner to raze
eyesore in the heart of downtown



WITH ITS CRUMBLING facade, the former M&I Bank Building on
Franklin Street stands out in comparison to the recently completed
street amenities such as stone sidewalks and planters.
Some Port officials and merchants said this week the city should
force the owner, Port Harbor Investments, to raze the structure.
Photo by Bill Schanen IV

By BILL SCHANEN IV
Ozaukee Press staff
Posted 8-20-08

Port Washington officials and business owners said this week that they are losing patience with an investment firm that bought the former M&I Bank building downtown, partially demolished it and let it sit in its dilapidated state for six months.

Port Harbor Investments, which bought the building at 122 North Franklin St. in December, promised an elaborate retail and residential development at a time when Port was hungry for hope of downtown reinvestment. Instead, the property has become a blight on a downtown struggling to revitalize itself, officials said.

“My patience is wearing thin, as I’m sure the patience of the merchants are,” Mayor Scott Huebner said. “It’s not going to be long before Port Harbor Investments is going to have to do something about its building or the city is going to have to bite the bullet and do something.”

Among the options the city has is to instruct its building inspector to issue a raze order for the property that would compel the owner to demolish the building or clear the way for the city to level it, said James Vollmar, an alderman who represents the downtown central business district and is a lawyer.

“From a lawyer’s perspective, I would certainly say the city has the power to intervene. They trashed the front of the building, so I think you would have a good argument that it’s beyond repair,” he said. “A raze order essentially says to the owner, ‘Take care of it or the city will raze it and charge it to you on your tax bill.’”

Officials said they have had “internal discussions” about issuing a raze order or taking other action to force Port Harbor Investments to address concerns about the building.

“I think there are things the city can do and I think the time has definitely come to take that step,” Vollmar said.

Huebner said the city and its downtown merchants cannot afford to wait much longer for something to be done.

“The fact is, the building is hurting downtown after all we have tried to do to improve it,” he said. “Not only does it hurt existing merchants, it hurts our efforts to attract new merchants.”

The look of the property is particularly jarring in the context of the recently redesigned downtown Franklin Street. The building’s broken windows, boarded-up facade and exposed framing are a glaring contrast to the decorative sidewalks, newly planted trees and flowerpots.

“If nothing else, I’d like to see them tear it down,” said Scott Schweizer, owner of Anchor Men’s Wear, a clothing store across Franklin Street from the former bank. “Anything would be better than what we have to look at now. It looks just like hell.”

Mark “Chico” Poull recently made a significant investment in improvements to his business, Schooner Pub, and offers outside seating just a few feet away from the former bank building.
“I look out at broken windows, but I really feel sorry for the guys across the street who have to look at the front of the building,” Poull said. “It looks pretty awful. They should just tear it down.”

At a workshop hosted by the city’s fledgling Main Street redevelopment program Monday, attendees — mostly residents, business owners and officials — identified the former bank building as one of the problems plaguing downtown that needs to be remedied immediately.

In a familiar refrain, Harm Modder, one of only two remaining partners in Port Harbor Investments, said Tuesday the firm will soon have the money needed to execute its plan for the former M&I building and a host of other downtown projects.

“For a while it was a matter of if we get our financing,” he said. “Now it’s just a matter of when, and it’s going to be soon.”

Modder said the same thing in April when Port Harbor Investments defaulted on its agreement to purchase Squires Country Club in the towns of Belgium and Port Washington.

Twice the firm or related corporations formed by Port Harbor Investments partners applied to the city for liquor and entertainment licenses for buildings it said it was buying. Twice the city delayed action on the requests because the firm did not purchase the properties.

“The economic problems this country is experiencing killed just about any hope we had of financing any of our plans and things haven’t gotten any better,” Modder said.

But now, he said, Port Harbor Investments turned to foreign markets and found a South American investor who has pledged to contribute “a very large amount of money” to the firm’s development efforts in Port Washington.

“We’re on the cusp of a breakthrough at last,” he said.

When asked why a South American investor would be interested in Port Washington, Modder said, “We did a good job of selling them on Port Washington and our plans. They looked at our community and our beautiful lake and they were excited.”

Modder said the investor has never visited the city, “but we’ve sent him a lot of photos.”

If the firm acquires the money it needs, its first priority would be to buy several downtown buildings it has been negotiating to purchase for months, Modder said. Among those properties are Smith Bros. Marketplace, the building that houses Harry’s Restaurant, the former Horsefeathers restaurant and possibly the shopping center that runs along the north slip section of the marina.

Modder said the firm is interested in acquiring additional downtown property but would not discuss those properties on the record.

Although Modder was noncommittal about a timeline for the redevelopment of the former M&I bank building, he said the firm could conceivably present a plan to the city within months and demolish the building before the end of the year.

Shortly after purchasing the bank building in December 2007, Port Harbor Investments began removing parts of the building’s facade. City officials later said they wanted to see plans for the new development before the company proceeded with demolition.

Since then, there has been little communication between the city and Modder, the only local partner in the firm, and officials are skeptical about the company’s promises of downtown investment.

“He (Modder) has been telling everybody for months it will only be another day until they get their money,” Vollmar said. “I told him that I don’t have any faith in their ability to get the money or do any of the things they have planned for downtown.”

Worse than empty promises, officials said, the firm’s inability to carry through on the purchase of several properties is interfering with the sale of those buildings to other buyers.

Tom Didier, president of the Business Improvement District board of directors, said the organization of downtown property owners remains hopeful Port Harbor Investments will carry through on its plan for the bank building.

“It’s frustrating,” he said. “A lot of people were very excited about their plans for downtown. It was like Port Harbor Investments was the savior downtown needed. I hope this still happens, but I get the sense that a lot of people have given up hope.”

Didier, a real estate agent, said the dilapidated building is a symptom of the city’s lack of involvement in downtown development. In contrast, he cited the example of the Village of Grafton, which through its Community Development Authority recently took preliminary steps to declare the vacant Grafton Hotel a blight and acquire it through eminent domain. The village was more than happy to shelve condemnation plans when it was informed by the property owner that a Milwaukee-based group plans to rehab the building for use as a restaurant and banquet facility.

“I think what Grafton has done by using its CDA to help redevelop downtown is great,” Didier said. “I’ve always thought Port should be more involved in downtown development, but I’ve been told repeatedly that it’s not the culture in Port Washington for the city to get involved with private property.

“In my opinion, this (the bank building) is what you get if you’re not involved.”

Port officials said they are leery about using the city’s power of eminent domain to acquire the building and would rather use building codes to force the property owner to raze the building.

Randy Tetzlaff, the city’s director of planning and development, said as bad as the building looks, he doesn’t think it is dilapidated enough to warrant a raze order.

“I was standing across the street from the building talking to Scott Schweizer the other day and he said, ‘Can you imagine having to look at that every day?’” Tetzlaff said. “He’s right. It’s bad, but it still appears to be secure.

“I don’t think the building inspector can issue a raze order yet, but there needs to be a determination about what to do with the building before the weather turns bad.”