Wednesday, April 30, 2008

Pabst Farms is looking like a bust...

I took a self-guided tour of Pabst Farms in Feb/March, around the time of the last snow. This could be a suburban slum-in-the-making.
Pay particular attention to the last twelve (mostly caption-free) shots. This little Towne Centre collection of empty store-fronts is an brutal commentary on suburban sprawl gone wrong. Roll the mouse over and click on the rectangular thingy in the lower left corner for the captions on the photos.



Several months back I posted a piece about Toll Brothers, a big east coast (Horsham, Pennsylvania) builder/developer. They are in the kind of serious financial distress that needs only a few more months of recession to do them in.

The principal reason for their dire straits was reported as partially completed work on developments, combined with options they had purchased on land for ever more development. That is the bane of anyone with big plans for "build out," based on rosy scenarios for the future of a real estate boom.

Locally, the general partners in Oconomowoc (and, presumably, lots of limited partners) committed huge amounts of capital to purchasing the raw land, surveying it, platting it, greasing the slow-turning wheels of government, creating marketing hype, bulldozing, laying sewer and water pipe, paving/curbing, advertising, lining up "preferred" builders, creating synergy through allied development of a hospital, a research park, and a bunch of corporate warehouses, And the real biggie-- snagging an adjacent Harley Davidson dealership. Then they had to cook up their naming schema (shops neatly tucked into a Towne Centre), and the evanescent promise of a regional shopping mall--a destination mall-- with "high end" anchors (we don't need no stinkin' WalMarts, contaminating our Bon Ton-like and Lord and Taylor-ish destinations). And, of course finagling a $25 million interchange on Interstate 94 to funnel customers into their subdivision and mall.

Once a project like Pabst Farms gets rolling, it needs to stay on a pretty quick, well-disciplined pace . If, heaven forfend, the untimely bursting of a real estate bubble intrudes, the general partners are in trouble. And their biggest trouble often comes from the clamoring of all those limited partners who put up much of the capital. These are, typically, country club fat cats, lots of orthopedists and plastic surgeons, professionals who have big incomes and are desperate for a sweet tax dodge. They have--in the usual scenario-- put up lots of money; they expect, in return, their share of the huge (dare we call them inflated?) expenses of the developers, including the marketing hype. When things slow down and there's little operating cash from the sale of lots, the general partners have to scramble, go back to the limited partners for cash infusions.

Pabst Farms is very likely in the unfortunate situation of being stuck right in the middle. They really can't justify continuing to lay sewer and water pipe, pave, plat and market overpriced vacant lots ($110 thousand and up, assessed value) in phase two and phase three. They are still trying to get some return on investment from the sale of the last of the lots in the low-rent, and --frankly, cheesy--Phase One. Meanwhile they,the developers, have to pay real estate taxes on the lots that sit there unsold.

As soon as they switch from corn to platted/ready-to-build-on lots in phase 2 and phase 3, they are out of low-tax farming and into high tax subdivision territory. How high? The taxes one pays on a 1/3 acre lot valued by the assessor at $110,000. Continuing to plant corn on most of the Pabst Farms acreage is nothing more than a weak attempt to hold off a looming day of reckoning.

And all that costly-though-tax-deductible Everything Else Is Just Another Subdivision marketing hype, going back to 2003 and before, is beginning to fade in the sun, just like the signs for Interlaken. That's the name of Phase Three out at The Farms, a phase that looks more like a hallucination than a real possibility.

Update: Drove by PF last week. No more subdivision development. They're planting--YOU GUESSED IT--corn, lotsa corn.

18 comments:

David said...

Wow. You can read all the news articles but seeing the pictures sends the message home. Scary stuff.

-Dave

Betsey said...

Jim,

I can almost hear the wind whistling across the expanse of empty lawn and see the tumbleweed rolling down Main Street.

" . .. . the name of phase three out at the farms, a phase that looks more like a hallucination than a real possibility."

It makes me want to reach for the scotch bottle.

MannYoung said...

Thank you for your excellent post and slide show. I live in Milwaukee and always wondered what exactly was going on with Pabst Farms as I'd pass it along the way to Madison.

I'd much rather see our state tax dollars spent on public transit infrastructure than on an ghost town interchange.

John said...

Excellent work illuminating blight-by-design, Jim.

Zach W. said...

Excellent entry, Jim. Pabst Farms really is a perfect example of the overexuberance of developers to cash in on the real estate bubble; it's just too bad that bubble burst in the middle of their grand plans.

Forward Our Motto said...

What a mess. Makes me sad for my old hometown.

Anonymous said...

Very nice commentary. We're new to the Milwaukee area and were intrigued by the idea of buying in Pabst Farms. That is, before my husband took a drive around. I wonder how the current homeowners are holding up.

Jeff said...

We're holding up just fine!

I take it you have never been to an area under development? It takes time.

My last subdivision in Waukesha was the same way. It took many years to finish.

The author should come back in the summer and show the nice houses with people and kids walking about having fun.

Or maybe some of the fun activities we get together and do.

Based on some of the comments in the slide show, the author sounds a bit jealous of those that can afford things.

Anyway, I love it here. My kids are getting a great education, and having fun! The community is awesome and it will only get better.

This post is slanted, and that is fine. You made a point. I think you are incorrect, but you are entitled to it.

Anonymous said...

I liked it better when they were still growing cabbages there, despite the smell.

a water engineer and chemist said...

I think it's interesting that the most costly and most permanent concern regarding this development is mentioned no where in the article.

Pabst Farms is the region where the deep aquifer of this area, reaching wells as far as Waukesha and trickling into an aquifer as west as Madison, is recharged.

Without the surface water, soils and vegetation of this area present- every building's footprint and parking lot caps off the earth's sponge. Waukesha's groundwater will continue to be reduced to old, mineralized, smelly water that presents health hazards.

Every bit of this development should have been sustainably designed. It wasn't--- yet.
There's still time to fix that. I'd like to see the new Brennan's fruit market using a green roof, leaving some green space, and using only permeable concrete span in the lot.

As for the pace of development, and getting "high end anchors" involved, that is purposeful. The community would like to see our downtown and our remote (Pabst Farms) development linked by a trolley.

For residents concerned about this development strategy, It's worth our wait for the right retailer to take their place. We don't want to look like Delafield, and we don't want to look like Schaumburg, IL. We want a unique retail experience that expresses unique qualities of this region... While not screwing our neighbor's wells up even more than they have already.

cailtin said...

WOW! What a pathetic example of a slanted attempt at journalism. You came out once and saw a bunch of homes under construction, a bunch of lots for sale and a few homes for sale. You saw a Market Place that was under construction, like the entire development is, and came to the conclusion that the entire project is a flop? I have lived in three countries and Pabst Farms, by far, exceeds any other neighborhood I have ever lived in. You made ridiculous captions under photos like, "construction not exactly speeding toward finish" and "in the middle of nowhere". You came out once and took photos?? It takes 9-12 months to build a house, not a day! Horwath is one of the best builders Milwaukee has to offer and if you had the courage to come back and take a look at us now, you would see that. Out of 170 lots 152 have home son them or are currently under construction. Beautiful homes, with gorgeous landscaping, happy children and a diverse group of neighbors that despite what RUMORS you all hear about, we actually like each other. We have parties, book clubs, poker night's, ladies night, play groups, meals for our new mom's, several outdoor party's and the list goes on. As for "in the middle of nowhere", we are in the heart of lake country! We have the best of everything at our disposal. The lakes, Madison and Milwaukee under 45 minute drive in either direction, the best public schools and a sense of community that I have never felt before moving to Pabst Farms. Sure the economy has slowed things down out here, but take a look around the planet and it has taken its toll there as well. I feel you did no service by posting this. You did not do any research, ask any questions to the people that live here, or take into consideration that the economy tanked. Yes, it was a farm once upon a time. The planet is getting more and more crowded every second. We can't live in outer space, we can't live on water, where else are we supposed to build??? At least it was not covered with a forest and we cut down all the trees! I dare you to come back out here and do a proper & responsible attempt at covering our neighborhood. You would all be better educated if you had the facts and not a bunch of made up crap.

Anonymous said...

Jim,
Obviously you didn't do your research. You have a pic of our homes with a caption no one has lived here for several years. That's pretty odd because we lived there for 4 yrs. We just moved out yesterday so our buyers can move in tomorrow. We are selling it so we could move to our new home on one of the empty lots in here (you had a pic of that lot). We added Geo therm and took advantage of green options. We love it here and it's dishearting to read a blog like yours that is full of lies. Take a look around at other subdivisions and see what has happened to them in this economy. We sold our home in 3 months and 1% off of asking. We used a custom builder (Home Specialist) for every home we built in here. This latest home is #4. The homes we built in here have sold quickly and close to asking so I would have to say this neigborhood is a good investment even in these tough times. One last comment about your captions, the caption on the One for the boat, hummer and... we built that home also. That is a typical 2 story 2600 sqft so not a mansion just your average home. This is a great neighborhood. I hope next time you want to blog you put down whatever your smokin and do the research.

Anonymous said...

How does that make you feel when you talk negatively about our family homes, the kind that young children live in, where they dream and play and feel secure?

kevin_worm said...

Honestly, I'd prefer not to spend TAX money on a interchange for a small, suburban neighborhood. I feel like "Pabst Farms" is trying to be like Johnson Creek.

Pabst Farms, take a hint from Johnson's Creek, they aren't doing to well these days. Who the heck would want to pay that property tax and live in the middle of nowhere?

brody said...

when the economy is fully recovered this project will take off. Not only has the town of Oconomowoc/Summit made strides to prepare for this project but the school district has also made improvements to provide for the project in 2 new middle schools and a few huge additions to the high school including one of the best high school theaters in the state. Anyone who argues that the location is an issue obviously has not been to Past Farms. Without traffic it is less then a 30 minute drive to DOWNTOWN Milwaukee and about 45-50 mins from Madison. The author also fails to mention the YMCA at Pabst Farms which is one of the best in the mid-west and the 20+ large "up-north" style lakes that have drawn people and wealth to the Lake country area for years. Pabst Farms will be a success.....its only a matter of time.

Mobile Homes said...

very interesting post. i think the government has something to say about this.Macomb Home Builder

Nancy Deterinski said...

"Pabst Farms will be a sucess....its only a matter of time.", to quote another comment.

Thats the scary part. It WILL be a success. No matter what, progress will push its ugly head through. I currently live in Colorado and the landscape is unreconizable from what it was 10 years ago. Stand in one spot and you see nothing but rolling waves of roof tops in every direction. The first houses built had 1/2 acre lots, but like Pabst Farms, the developers were in financial destress, so the lots become smaller and smaller. Now the $400,000 houses are being built with literally 15 feet of space on each side. And they keep building them. They also had years to prepare, but it didn't matter. Land set aside for roads doesnt make money. And with the developers falling farther and farther into debt, they sucked up every last inch with sell-able land. I can only describe what is happening in Colorado is a crisis. Gridlocked traffic, I mean gridlocked! Air quality from idling cars is terrible. Theres a yellow haze that lingers. I was born and raised in Oconomowoc, a 1/4 mile from where Pabst Farms is and to think of what lies in store makes me sick. These developers will pack as many houses into an area as they can to recoup their costs. They have the city bought off too. Dont let Colorado happen to you!

Asa said...

Jeff said, "Based on some of the comments in the slide show, the author sounds a bit jealous of those that can afford things." WOW!!! A comment from above.

Makes me not regret the move from "Lake Country" one bit!!!!! I have never in my life lived amongst such pompous, arrogant and conceded people in all my life. To the people of Lake Country, their existence is the center of the universe. If a person has an opinion contrary to their apparition of perfection, well then OF COURSE, they must be jealous! That was always the attitude of the subdivision trash of Delafield and Hartland and Oconomowoc! I'm so glad I left the area, hell, I left the state!!! That whole area needs a direct meteor hit. I remember how people in that area only talked about two things, what they had....and what they were going to get. Waukesha County as a whole is a collection of very sick people. Seriously! Sick in the head, delusional to the real world. These neatly planned communities are nothing more than proof of that. They move into these cookie cutter neighborhoods that have the pre-conceived aura of faultlessness...where they no longer need to think of anything beyond their little tiny green manicured lawns and their SUVs and their offices. It shelters them from having to think too much or think too hard of the problems in the world. It's such a fragile and brittle reality they have built for themselves. No wonder why the suicide rate is highest in the exact profile of people who would buy a house here!!! They grow up trying to condition themselves that what they are is perfection.....what they are and the life they’re living is what others must envy....well of course the 'others' are jealous of me....look at my big house....look at my perfect little kids...look at my two SUVs.....look at my John Deere lawn tractor....look at my credit card debt.....look at my over-medicated wife.....look at my kids who are secretly in therapy....look at me, a closet alcoholic.....oh no, what will the neighbors think if they found out.....I can't live with the thought of not being perfect....BANG!!!!! They blow their heads off. You know what, you pathetic, pathetic people....keep living your life of delusion! I thank God every day I got away from that HOA, fake-ass, disgusting mess!!! Continue to wallow in that despair and keep telling yourself that you're the cream of the crop!

And oh, by the way, just so you don’t think I am jealous of you 'Jeff', I moved from Lake Country to a small town in South Dakota where I pay no sales tax, no property tax and I own 40 acres and an eight year old house. Best part, the price was half what I sold my house in Delafield for in 2009. We have great schools and I know personally every one of my kids teachers, so I know if their having any problems. We have everything we need right here. I travel a total of three months a year for my job, so I've seen enough of the rest of the world to make a very erudite opinion on different places to live, and folks....Lake Country is a puss-filled pool of arrogance!!!

Blog Archive

About Me

My photo
Of the biblical allotment of three score and ten I have lived only three of them more than a bicycle ride from one of the Great Lakes. I grew up ten blocks from Lake Erie in the (once Irish/Italian ghetto, now newly-hip) "Near West Side" of Cleveland. I can still cycle to the Milwaukee lakefront in an hour and a half; but, a round-trip has always been more than I would (noror ever did) attempt. -0- I'm a "...somewhat combative pacifist and fairly cooperative anarchist," after the example of Grace Paley (1922-2007). -0- I'm always cheerful when I pay my taxes (having refused--when necessary--to pay that portion of them dedicated to war). -0- And I always, always vote.