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State Department of Transportation to buy Edgerton building

EDGERTON — The Wisconsin Department of Transportation is pumping more than $500,000 into buying and retrofitting a vacant business property in Edgerton as a regional project office for the pending Interstate 90/39 expansion.

DOT Southwest Region Megaprojects Supervisor Kim Schauder confirmed the department in late August bought the 15,000-square-foot former Large Digital Format building for just over $500,000.

The DOT plans to retrofit the building to add office space for an additional 60 project engineers who’ll be working on the southern portion of the I-90/39 expansion over the next five to 10 years, Schauder said.

The DOT had pursued several locations near the Interstate in Janesville and Edgerton, Schauder said. It settled on the former Large Format Digital, which is in the city’s north business park at 111 Interstate Blvd. because of its size, location and price.

If the state owns the building for 10 years, it would be the equivalent of paying about $50,000 a year in rent.

Schauder said the DOT would not have been able to lease a comparable space at that cost.

Former building owner Large Format Digital printed advertisements on panels of trucks. The company at one point employed 15 people. It opened in 1998 and closed in March 2010 amid the economic downturn.

The building initially cost about $1 million and was most recently assessed at over a million according to city records.

The property was originally listed in April 2010 for $799,000 and is now listed as “sold” at a price of $524,895, according to an online listing posted by Shorewest Realtors.

The DOT believes the local real estate market will improve within the next five to 10 years, and the agency will at least break even on costs tied to the building.

“We figure somewhere between there will be some increase in value,” Schauder said.

The DOT still is discussing a plan to retrofit the facility to add needed office space, and no cost estimates were available.

Schauder said the department would have to renovate about half the building to add office space, but some engineers could start working at the Edgerton office in the next two months.

It’s not unheard of for the DOT to buy vacant buildings as regional project offices. Schauder said the department bought a vacant former Best Buy in Green Bay to house engineers working on the Highway 41 expansion.

“It just turned out to be better long-range deal to purchase it,” she said.

Edgerton Fire Department in 2010 was eyeing the former Large Digital Format building but it walked away from a deal on the property because its location would have meant increased response times, officials said.

According to city records and listings by Shorewest Realtors, owners of the property paid the city between $27,400 and $27,700 in property taxes annually. Yet under DOT ownership, the property will leave the tax rolls, officials said.

Schauder said talks are in the works with the city about the state potentially paying to run Internet infrastructure to the business park, where the building is located.

That’s a type of incentive the state rarely offers. Schauder said such a deal would be intended “to ensure the city is benefiting from us being there.”