The Foxconn Effect and How to Invest

[Michael Kretch]

Last year news was announced that Foxconn plans to build a large plant in Racine County, WI. My initial thought was that housing prices and rents should continue to rise nearby to accommodate the future workforce and current demand, so rental property could be a good investment approach. However, maybe I'm not thinking deeply enough.

What other ways could investors approach a development of this size? Will the main beneficiaries be close by Kenosha and Racine or will the true beneficiaries be nearby Chicago and Milwaukee?

Instead of residential real estate, would a savvy investor look to commercial property, self-storage, land development, all of the above in this situation?

I'm bullish on Southeastern Wisconsin and the I-94 corridor. I had been researching Kenosha and Racine before the Foxconn news was announced and made my first purchase in the area about 6 months ago. So far I've bought 2 single-family rentals and am set to close on my first 4-unit building next week. My initial goal is to purchase $1M in B-C+ class cash flowing rentals in the region.

It would be great to hear your thoughts and ideas BP!

[Jeff Burdick]

I think Illinois is the quiet winner in the Foxconn deal.  Illinois will get a lot of the benefits, with it being placed so close to the border, but Illinois didn't have to shell out the billions in tax breaks and subsidies that Wisconsin did.