Menomonee Falls board officially 'unwinds' agreement with Kohl's
Pulling out of deal was written to benefit village
Menomonee Falls — The 200-page development agreement between Kohl's Corp. and Menomonee Falls is beginning to unravel, according to a Village Board decision last week.
The Menomonee Falls Village Board on Dec. 16 set in motion agreement provisions put in place in case Kohl's backed out of a $250 million plan to build a corporate campus at the Woodland Prime office park in Menomonee Falls.
"Frankly, the unwinding of this agreement, if Kohl's ever chose not to go through with the development, and that has happened, was to be in the benefit of the village and to the benefit of the village and the deal was always written accordingly," Village Manager Mark Fitzgerald told the Village Board during a presentation last week.
Kohl's announced in November that it completed plans to buy a 300,000-square-foot building on Ridgewood Drive in the Silver Spring Corporate Park, where the company's current headquarters are located. The building is across the street from the main Kohl's building and next to the company's 24,000-square-foot wellness center. Kohl's also has agreed to buy the 28,000-square-foot former ProHealth medical building at W165 N5595 Creekwood Crossing, across from the Silver Spring Corporate Park. The company is opting to purchase these two buildings to accommodate its growth, instead of going forward with construction at Woodland Prime.
Kohl's turns land over
Now that the agreement is in the termination phase, on or before Jan. 31, Kohl's will give back to the village 103 acres of vacant land at Woodland Prime. The land is valued at $10 million. The village paid $1.5 million for it.
When the original transaction went through, the village obtained a facility on Woodale Drive used by Kohl's as a distribution site. Menomonee Falls will keep this building that has an assessed value of $8.8 million. Kohl's is currently leasing the facility from the village, but will vacate the site by 2015, Fitzgerald said. The village plans to turn the building into its sole public works facility.
There will still be additional space in the building that the village could lease to another company. Trustee Steve Raymonds asked if the village could look into selling the facility to a private company and then they could lease the building instead of own it. The village's legal counsel said it could be a possibility in the future.
When the village and Kohl's began to discuss a corporate campus at Woodland Prime, the village purchased a building for $7.7 million that is located in the office park. That building was handed over to Kohl's in the real estate transaction. Kohl's will keep it, though Fitzgerald said he doesn't know what the company will do with the facility.
Village seeking developers
Meanwhile, the future of the vacant land is unknown.
"Our best scenario is to get this land back into the hands of a private developer as quickly as we can," Fitzgerald said. "That's the key strategy, but how we work on that and how we make that happen in the first half of 2014 is still unknown."
If the corporate campus had been constructed, the plan was to extend a road out to Fond du Lac Avenue. Trustee Sharon Ellis asked if that is still the plan.
Fitzgerald said a new roadway was planned to accommodate Kohl's traffic which could have seen upwards of 10,000 employees on any given day. The village is no longer anticipating a development of that size, therefore, does not see any current need for that roadway. But, time will ultimately tell.
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