An affiliate of Missouri-based Drury Southwest, Inc., has purchased The First Financial Centre at the northeast corner of Water Street and Wisconsin Avenue in downtown Milwaukee and is planning to convert the 14-story office building into a 200-room Drury Hotel.
The company purchased the 154,200-square-foot building, located at 700 N. Water St., for $4.6 million from Bachan Singh, of Brookfield. The property is currently 30 percent occupied and assessed by the city at $3.2 million.
Herb Wedemeier, senior vice president and secretary of Drury Southwest, said the long-term plan is to evaluate the market for three to five years and then convert the office building into a hotel. Once the remodeling begins, the project would take 18 months to two years, Wedemeier said.
“We’re excited to have an opportunity in Wisconsin,” Wedemeier said. “We’re seeing all of the excitement and opportunity happening in Milwaukee and it looks like a place we want to be.”
The First Financial Centre was built in 1928, which is one of the reasons the Drury group was drawn to the property, Wedemeier said.
In January, the 189-room Drury Plaza Hotel opened in the former Cleveland Board of Education building, a long-neglected building in downtown Cleveland. The $52 million renovation project of the 85-year-old building is one of many the Drury has done across the country, Wedemeier said.
“Our company does a fantastic job of taking older buildings that are worn out and converting them for adaptive reuse,” he said. “Our design and construction teams are excellent at bringing old buildings back to life and we can do that with this building in Milwaukee.”
The First Financial Centre has been a distressed asset for years, particularly since the Great Recession. Several tenants have left the building, including former first floor retail tenant, Associated Bank in 2014.
J.P. Morgan Chase Commercial Mortgage Securities Corp. acquired the building in 2012 in a deed in lieu of foreclosure action.
It was then sold at auction for $3.3 million last year, almost half of its assessed value at the time of $6.1 million, to a local investment group. Siegel-Gallagher was hired to resell the property.
BizTimes first reported in December that a hotel was planned for the property. At the time, Plover investor Rolly Lokre, principle of Lokre Companies, had an option to purchase the property. He later sold the contract to Drury Southwest.
Lokre could not immediately be reached for comment.
