Developer Asking For City Help For Fox Run Center Proposal

WAUKESHA, WI — Two developers want to transform the old Fox Run Shopping Center into something new, and city officials are going to take a look at the proposal Tuesday night.

Waukesha City officials say VJS Development Group and Somerstone are proposing a redevelopment project that includes a mix of medical/office, multi-family residential, and commercial uses at the old Fox Run shopping center.

The 13.42 acre site has seen decline over the past 10 years with numerous vacancies including the entire north multi-tenant building and the restaurant space formerly occupied by Denny’s, according to city officials say.

Redevelopment of the site isn't going to be cheap, and the developers are asking the city to create a Tax Incremental Financing district. Without the TIF district, developers say the project wouldn't be feasible due to the removal of buildings and parking lots, environmental cleanup, and utility work.

"Due to the extraordinary costs related to site preparation, the developer is requesting an estimated $3.7 million grant payment as tax increment is generated from the project (PAYGO). The City Contribution shall vary pro-rata depending on the completed value and date of completion. For example, if the increment value were to exceed the estimated $32,340,379, the PAYGO amount could increase or if the value ends up below that amount the PAYGO would decrease," meeting documents stated

Hey, What's A TIF District?

A TIF district is a development tool municipalities can use to attract business. Here's how it works: A financing district is created, and a base value of that district is established by the taxing jurisdictions. Over the years, it's expected that the property will increase in value. The increased value of the property is still charged at the base rate, but the district uses the increased tax revenue to pay for the infrastructure projects.

This means those taxing entities receive the amount of tax revenue they did before the district was created. During the life of the district, tax revenue on new development pays off the infrastructure costs.

The residential development would be at the northwest corner of the site, the medical office building would be at the southeast corner of the site near the corner of W. Sunset Drive and St. Paul Avenue. The Chase Bank would remain, and the former Denny’s site would be redeveloped as a retail site.

The use of the lands north of the medical office building has not been determined.

If approved by the Common Council, staff will begin the process to create a Tax Incremental District and draft a full development agreement between the City and Developers.