Land buy-up sparks fear in Town of Port

A company is negotiating with scores of landowners to purchase more than 1,000 acres of mostly farmland in the Town of Port Washington for what officials and residents have heard would be a sprawling microchip manufacturing campus so large it could be similar in size to the Foxconn site in Mount Pleasant.

Town officials and residents confirmed this week that Jeff Hoffman, a principal with the Milwaukee commercial real estate company Cushman & Wakefield/Boerke and a Port Washington High School graduate, is aggressively pursuing land purchase contracts with multiple town property owners on behalf of the potential buyer for amounts that are considerably higher than what the land is worth — enough to make farmers who own hundreds of acres instant millionaires.

“A couple of families could net $20 million to $30 million,” Town Supr. Greg Welton said. “And 85% to 90% (of the land targeted by the buyer) may be under contract already.”

Town Chairman Mike Didier, who is a real estate agent, said, “It’s safe to say that offers are being written, and I believe a lot of land is already under contract.”

Didier said he has been told that landowners are being offered $40,000 per acre for property in an area that extends north from Knellsville at the town’s border with the City of Port Washington to roughly Dixie Road and is west of I-43 and east of the Ozaukee Interurban Trail.

“Everybody is being offered the same deal, about four times what the land is worth,” he said. “It’s a lot of money, a lot more than the land is worth.”

Town resident Paul Krauska said Hoffman offered him $42,000 an acre for his five-acre parcel.

Didier said based on what he has heard, the potential buyer is seeking about 1,000 acres. Welton said he believes it could be 1,200 to 1,800 acres.

While it is clear land deals are being made, Ozaukee Press has not confirmed who the potential buyer is or its plans for the land.

Town officials said the buyer has not contacted the town, and what they know about a project that is shrouded in secrecy — landowners who have agreed to sell their land have had to sign non-disclosure agreements —  has been gleaned from landowners, some of whom have agreed to sell their property and others who haven’t made a decision yet.   

“Anyone who knows anything isn’t saying anything,” Welton said.

Town officials may, in fact, have very little to say about the project, which almost certainly would hinge on the town land being annexed into the City of Port Washington.

When asked Tuesday if the city has been approached about a possible annexation for the project, Mayor Ted Neitzke said, “At this time, I don’t have any comment. I don’t know enough to comment.”

But there is plenty of talk in the town about the potential buyer, who residents and officials suspect is a high-tech manufacturer, perhaps a maker of semiconductors — the microchips that are the critical components of electronic devices that range from smartphones and computers to advanced medical diagnostic equipment — that was drawn to the town by its abundance of open farmland and a water source in Lake Michigan that is key to the manufacturing of semiconductors. Microchip manufacturers use millions of gallons of water a day to cool equipment and ensure chips are free of contaminants.

“If you look north from Milwaukee on Google Maps you pretty quickly come to the Town of Port and say, ‘Look at all that open land,’” Didier said. “It’s flat and clear-cut from back in the day, and  if you’re a manufacturer, it’s relatively close to your source of employees and things like an airport in Milwaukee.”

The manufacturing campus could be sprawling, consisting of multiple factories and requiring a massive investment in infrastructure to support it — everything from new roads and freeway access to electrical substations and the extension of services such as water and sewer from the City of Port Washington, although the city’s current water plant would not have nearly enough capacity to support a semiconductor operation.

“It’s so massive and would require so much water that they would have to have their own water plant,” Welton said. “The size of this is just insane. It could be the largest project in the country.”

Word of a possible mega-development  in the town comes at a time when President Joe Biden and chip-makers like Intel are making it a priority to increase domestic semiconductor production and create thousands of high-tech, high-paying jobs.

The White House announced last month that it has reached a preliminary deal that would give Intel $8.5 billion, plus another $11 billion in loans, to build and expand chip-making facilities in Arizona, Ohio, New Mexico and Oregon.

Wisconsin, in fact, at one time courted Intel, hoping the company would buy land at the Foxconn site for the construction of a semiconductor facility. Foxconn owns 1,200 acres in the Village of Mount Pleasant in Racine County, but much of the land is vacant and it was hoped some of it would be sold to Intel. That deal, however, fell through when Intel chose to build its $20 billion chip-making hub in Ohio, a project that was lauded by Biden in his State of the Union address.

State Rep. Rob Brooks, R-Saukville, said although he has heard nothing about plans for a high-tech manufacturing facility in the Town of Port Washington, it wouldn’t surprise him.

“Across the state we are getting a lot of interest (from technology companies) because of projects like Foxconn and Microsoft,” he said, referring to Microsoft’s plan to purchase more than 1,000 acres originally intended for Foxconn to build at least four data centers. “This is especially true in communities that have access to Lake Michigan because of the need for water, so it wouldn’t surprise me in the least to see something like this in the town.”

While high-tech manufacturing plants  that create hundreds if not thousands of high-paying jobs are sought by communities like Mount Pleasant, concern is growing in the Town of Port Washington even before plans have been announced because of the impact a manufacturing complex the size of the one envisioned would have on everything from the rural character of northern Ozaukee County and the future of farming there to property values.

“I’m sure the people who are selling their land are all for this,” Didier said. “Probably everyone else in the town is against it.”

Welton said, “It may bring a lot of jobs and wealth to the area, but we are going to be left with something like two major farms. We won’t be a rural community any more. We’ll just be a suburb of Milwaukee.

“Actually, it really sucks for the town.”

Didier said a 1,000-acre manufacturing facility would eliminate one-tenth of the town’s agricultural land.

“It would have a huge impact on the town,” he said.

It will also have an impact on homeowners in the development zone who decide not to sell their land.

Krauska, whose home and several  outbuildings are on five acres on Highway LL immediately south of Dixie Road, said he rejected Hoffman’s offer of $42,000 an acre for his land.

“He came to my property with a high-pressure pitch and a low-ball offer,” Krauska said. “I was insulted by his offer and told him, ‘You have to sharpen your pencil, and you have to sharpen your pencil a lot before you come back.’

“And the best part was that I’d have to pay him 4% commission for taking my land. That’s just not fair.”

Krauska said his house is designed to accommodate his son, who is disabled, and he uses his property to support his business, Eddie’s Service in Saukville. The money he was offered, he said, wouldn’t come close to covering the cost of buying five acres elsewhere and building another house to suit his family’s needs.

“I built this house. My wife designed it and I still owe money on it,” he said. “I planned on dying in this house.”

Krauska said that after he rejected the offer for his land, Hoffman told him the buyer was no longer interested in his property.

“He said they would build a big berm around my land and plant trees that my wife could pick out,” he said.

So now, Krauska said, he is faced with the prospect of living in the shadow of a sprawling manufacturing facility or being forced to sell his land if the buyer changes its mind.

“So what will happen is they’ll devalue my property and then use eminent domain to take my land if they want it,” he said.

Krauska said Hoffman would not discuss the buyer or plans for the land it acquires.

“He said he couldn’t tell me who is buying the properties, that it would become known when the land is annexed to the city,” he said.

Krauska said he was told landowners have until the end of the month to sign contracts to sell their land. Welton said he was shown a document that suggested sellers would be informed by Sept. 1 if the buyer intended to close on the purchases.

“But I was told (by someone who was offered a land deal) that other documents make it sound like it would be sooner, maybe a lot sooner,” Welton said. “And he was very confident this would happen.”