Except at peak times, Milwaukeeans hardly realize that that they are sharing their city with millions of tourists who outnumber them 10 to one. In 2016, 23 million tourists made their way to the Milwaukee area, according to the Wisconsin Department of Tourism. Milwaukee has become a new destination city.
For example, in October 2017, Milwaukee made two Travel + Leisure lists, which rated it 10th among 20 cities as one of America’s Friendliest Cities, and sixth among 20 cities as one of the Most Underrated Cities. In the same time frame, AARP The Magazine featured Milwaukee as a “Heartland Getaway” city. According to VISIT Milwaukee, more than 900 articles were published in 2017 touting the city’s attractions and ambience. “Rumor has it the Bronze Fonz, just south of Wells St. Downtown, is the most photographed sight in Milwaukee,” according to a Lonely Planet article.
Tourism revenues have increased by more than 3% for each of the past five years. In 2016, Milwaukee tourism had an economic impact of more than $5 billion, accounting for about ¼ of total tourism revenues for Wisconsin. Milwaukee-area tourism supported more than 50,000 full-time jobs and generated $3.5 million in taxes. Milwaukee tourism supports more jobs than the top-three regional employers—Aurora Healthcare, Ascension Wisconsin and Froedtert Health—combined.
Milwaukee Offers Something for Everyone
With a full array of cultural and recreational attractions to offer its guests, Milwaukee is also well situated on the shores of a spectacular lake. Marco Bloemendaal, senior vice president of sales at VISIT Milwaukee, says that in Milwaukee there is something for everyone, and that helps drive tourism. “That sounds like a cliché, but not every city has that,” he says.
“Certain cities are very focused. If you don’t like beer or motorcycles, there is so much more here. I love the fact that we’ve kept historic buildings. We have these beautiful historical parts that we’ve combined with these great modern assets, which create that great vibe of the city. When we bring [potential convention] clients, we almost bribe them; come, just come, we know you’re going to love it. Ninety-eight percent say, ‘I had no idea. The vibe of the city is fantastic. My family is going to love it,’ or ‘my attendees are going to enjoy the Art Museum or take a brewery tour or enjoy the fantastic food scene.’”
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Marcus Corporation president Greg Marcus agrees. “We’ve got great resources and a beautiful lakefront. We’ve had a lot of exciting development going on, and we’ve invested in a lot of important assets. When you invest in those assets, those are demand generators. That’s what brings people here.”
Part of the city’s vibe is that the people who live here are welcoming and friendly. “We have a very good Midwestern ethos that I think resonates with people,” Marcus says. “Don’t forget about the people,” agrees Bloemendaal. “You can talk about assets, bricks and mortar, but I think the people here make a huge difference. People are craving genuine hospitality. I’ve been here many years now, and if people see you looking for something, three people stop and say, ‘Are you trying to find something? Can I help you go somewhere?’ That’s huge when you’re here with your family. That’s genuine.”
Corporations Move Downtown
Buttressing Milwaukee’s image are the many businesses that have moved to the city’s Downtown area—reversing a decades-old trend of corporate flight to the suburbs. The return began in 2007 with ManpowerGroup’s move Downtown from Glendale. Recently, Brookfield-based J.P. Cullen decided to relocate Downtown, joining Hammes Company, which is building a five-story office building at Knapp and Water streets. Bader Rutter now occupies the former Laacke & Joys building; JLL, a commercial real estate firm, recently moved to the Two Fifty East building on Wisconsin Avenue. Zurn recently moved its headquarters from Erie, Penn., to the Reed Street Yards in the Fifth Ward, and Logicalis, a London-based IT firm, moved its Brookfield office to Downtown in 2014.
“All of a sudden, it’s very popular to have headquarters Downtown,” Bloemendaal says. He says the presence of more Downtown businesses attracts business visitors and also brings a young, vibrant workforce that wants to live there. Theresa Nemetz, owner of Milwaukee Food & City Tours, is doing a booming business offering walking and bus tours to more than 15,000 people annually, about half of whom are out-of-towners. She began her business 10 years ago as a hobby, offering a walking tour on Brady Street. Now, during the busy summer season, Milwaukee Food & City Tours offers more than 40 tours a day.
Nemetz is frequently hired by local businesses who want to showcase the city to potential employees. “When they’re here and on the tour, they’re amazed,” she says. “They had no idea. Milwaukee is not on their radar when they are asked to come to town for an interview. But by the time they leave, they are asking great questions about transportation, the cost of rent, school districts and the lakefront. They’re really impressed with Milwaukee. Half of them want to live Downtown, and half want to live in the suburbs.”
Milwaukee Invests in Development
Since the 2004 appointment of Rocky Marcoux as the Department of City Development Commissioner, Milwaukee has invested in projects that not only improved the quality of life for residents but drew tourists as well. “Milwaukee would not be what it is today without Rocky Marcoux. He is the Godfather of Milwaukee,” says Kristin Settle, director of communications at VISIT Milwaukee.
Marcoux spearheaded the development of Riverwalk and the redevelopment of the Park East corridor and the Menomonee Valley, among many other projects. “All of the improvements and developments in Milwaukee complement each other and have come about because of the other one,” Settle says. “Had Riverwalk not developed, I don’t know that Brewer’s Hill and the area around Lakefront Brewery, the North End, would have been so well developed. If the [Milwaukee] Public Market hadn’t come along, would the Third Ward be what it is today? If the [Milwaukee] Art Museum expansion hadn’t come along, would the new Gateway project be happening? All of these things are working in concert. It’s been so well orchestrated across the city.”
Hotel Expansion Downtown
Since 2012, eight new hotels with more than 1,400 rooms have opened in Downtown Milwaukee. Four new hotels are scheduled to open in 2018-2019, which will add another 700 rooms to the 16,000-room hotel capacity in the Milwaukee area. Outside of the city, a Springhill Suites hotel will be built at the Milwaukee County Research Park in Wauwatosa. Recently approved is a 196-room luxury hotel to be built in a converted office tower at Mayfair, and Hilton plans to build a Tru hotel in Brookfield near Goerkes Corners. In Wisconsin, Airbnb service grew 97% from 2016, with more than $12 million earned from rentals, which generated $546,000 in tax revenues. Milwaukee hosted 40,600 guests out of 210,000 guests statewide.
Marcus is concerned about an oversupply of hotel rooms in Milwaukee. “While there are more visitors coming, we’re investing in hotel infrastructure that is outpacing demand,” he says. “That leads to cracks in the façade in our market. In the summertime, everyone does well. There’s a surplus of demand. But when you start to go to the off-season, when it’s not as nice here, you’re starting to see that the occupancies are going down. In the last year, occupancy rates are down in Milwaukee. There are more tourists, but there are also more rooms. In the end, that’s not a good economic model.” The Milwaukee Business Journal reported that occupancy dropped 2% year-over-year from November 2016 to November 2017, while room supply increased 3.8%. During this period the average daily rate increased by 4.6%.
Marcus says the EB-5 visa program has been a driver of new hotel development. The EB-5 (Employment-Based Fifth Preference Category) program provides foreign investors and their families with an opportunity to apply for Green Cards in exchange for qualified investment of $500,000 or $1 million in qualified local projects than create at least 10 full-time jobs. Milwaukee has been a Regional Immigrant Investor Zone since 2007.
“Unfortunately what’s happened is that a lot of hotels have been built not for economic reasons, but because there’s a subsidy available to build them,” Marcus says. People who want Green Cards may have “return motives that may be different from someone who says, ‘I want to invest because of the rate of return on my investment.’ How do you calculate the rate of return on a Green Card? I don’t even know. That leads to imbalances in the market.” A number of the Downtown hotels built since 2012—including the Kimpton, Aloft, Marriott and The Brewhouse—have received EB-5 funding.
Jane Schilz, who is resident owner of Sheridan House and Cafe in Cudahy, says the occupancy rate at her 12-room luxury boutique hotel has grown to 39% from 19%, in the past two years. She has been in business since 2007.
Schilz has seen increases in business and international travelers through Expedia and billboard ads near the airport. She has attracted guests from Chicago and “staycationing” Milwaukeeans. She says what attracts her guests is the hotel’s home-away-from-home atmosphere and its location on South Lake Drive near Warnimont and Grant Parks, which offer many recreational activities, including hiking, biking, swimming, golf and archery. The hotel’s Cudahy location is 10 minutes from both Downtown Milwaukee and the airport. During the busy season, large Downtown hotels often give Schilz referrals.
The Chinese are Coming!
Although the economy in Wisconsin is lagging, “the economy worldwide is not,” says Settle. “So people have money to spend.” Nemetz is anticipating growth in Chinese tourism. “I think Milwaukee is on the upswing of tourism and will continue to grow significantly each year,” she says. “We are looking at the influx of the Chinese traveler. It is fascinating how quickly those numbers are starting to grow.”
Nemetz says the visa process for the Chinese traveler has changed. Formerly, Chinese travelers could only visit one city, which typically was on the U.S. east or west coasts. Today, Chinese tourists get 10-year visas, which allow them to take multiple trips. “That’s when they’re coming into the Midwest,” she explains. “We’re seeing that the Chinese traveler already has access to huge cities and technology [in China]. So, when they travel, they don’t want that. They are looking for rural experiences; they want to go hunting; they want to see sunrises on the lakefront; they want to see an apple orchard or go to a cheese factory. We’ve hosted a couple of groups from China. They really want a nature/outdoor experience.” Nemetz wants to expand her tours to include more rural daytrips from Milwaukee to accommodate this growing group of Chinese tourists.
VISIT Milwaukee publishes tourist brochures in 12 languages, including Chinese, Russian, Polish, Arabic, Hindi and Japanese. “Our foreign visitors are so wowed that we have a brochure in their language with the 10 things you must do in Milwaukee,” says Settle. “I think that speaks to our hospitality. We want to make everyone feel welcome here in Milwaukee.”
‘Great Material to Work With’
Tourism is nothing new to Milwaukee. Back in 1938, near the end of the Great Depression and when Milwaukee was an industrial powerhouse, the Milwaukee Association of Commerce boasted that the previous year’s 365 conventions brought 114,000 tourists to town. Today, the city hosts more than 400,000 people at 500 conventions and business meetings. The estimated gross economic impact of the Wisconsin Center District convention facilities is almost $500 million. Summerfest attracts more than 800,000 attendees with an economic impact of $187 million on Milwaukee, according to a 2013 study by Tourism Economics.
Bloemendaal says VISIT Milwaukee does not take credit for all the visitors to Milwaukee. “It’s a community-wide effort,” he says. “But we do know that if we don’t market what great assets this city has, we will see the 23 million drop very quickly.” VISIT Milwaukee showcases Milwaukee by hosting site visits for 90 convention planners and nearly 100 travel writers annually.
“Milwaukee has a much stronger story to tell today than it had 10 or 15 years ago,” Settle says. “I am no different than any other PR person in the world. It’s just that I have great material to work with.”
