Waukesha State Bank v. 225 East Michigan Street LLC ($6.7M Mackie Building Foreclosure)
Waukesha State Bank sued 225 East Michigan Street LLC, an affiliate of Milwaukee developer J. Jeffers & Co., on August 3, 2026 in Milwaukee County Circuit Court to foreclose on the historic Mackie Building after the LLC defaulted on a $6.57 million loan, owing roughly $5.9 million in principal plus interest and fees. Jeffers attributes the default to below-pre-pandemic revenue at anchor tenant The Grain Exchange, an event venue whose percentage-of-revenue rent has fallen short of what the mortgage requires; the bank separately sued Jeffers and affiliated entities in Waukesha County Circuit Court seeking a personal money judgment.
Why it matters
A clean illustration of how a percentage-rent lease structure -- common for hospitality and event-venue tenants precisely because it lets rent flex with a volatile revenue stream -- can leave a landlord newly exposed to a fixed mortgage obligation once that tenant's business genuinely doesn't recover, rather than simply dips temporarily. Owners financing a building around a single anchor tenant's percentage rent should stress-test debt service against a permanently lower post-pandemic revenue baseline for hospitality/events tenants specifically, not just a temporary downturn, and should track the tenant's own lease-renewal timeline as a leading indicator of the landlord's own refinancing risk.
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