Construction has stopped on the Neutral Edison project in Milwaukee, which was planned to be the tallest mass timber building in the United States. The developer, Neutral, announced the pause in construction due to increased costs from tariffs and general inflation. The company is now working on a cost-reduction and value-engineering process to restart the project.
Key Takeaways
- Construction on the Neutral Edison building in Milwaukee has been halted.
- The project aimed to be the tallest mass timber structure in the U.S.
- Increased costs due to tariffs and inflation are cited as the reasons for the pause.
- The developer is undertaking a cost-reduction and value-engineering process.
- The building was planned to have 31 stories, 350 residential units, and retail space.
Neutral Edison Project Faces Economic Challenges
Neutral, the developer behind the Neutral Edison project, confirmed the construction halt. The company's in-house design team created the initial plans for the building, which were revealed in June of this year. The project had broken ground in June 2025 and was expected to be completed by 2027.
According to a statement from Neutral, shared by the Milwaukee Journal Sentinel, "Recent tariffs and broader inflation have materially increased key input hard costs." This indicates that the financial environment has made the original construction plan unfeasible without adjustments.
Project Snapshot
- Original Height: 31 stories
- Residential Units: 350
- Retail Space: Approximately 7,200 square feet
- Embodied Carbon Reduction: Estimated 54% (due to mass timber)
- Operational Carbon Reduction: Estimated 45% (compared to conventional buildings)
The developer is collaborating with C.D. Smith Construction to find ways to reduce expenses. This process, known as value engineering, aims to maintain the project's core goals while cutting costs.
Impact of Tariffs and Inflation on Construction
The decision to pause construction highlights the ongoing challenges in the construction industry. Tariffs on imported materials and general inflation have driven up prices for many building components.
Background on Construction Costs
Earlier this year, analyses by the ABC (Associated Builders and Contractors) showed a significant rise in construction material prices. A report in April noted that tariffs were a key factor. A subsequent analysis in June reinforced these findings, detailing how tariffed construction materials had increased in cost.
These economic pressures affect large-scale projects like Neutral Edison. Developers must consider the fluctuating costs of steel, lumber, and other essential materials.
The statement from Neutral did not provide a specific timeline for resuming construction. It only stated that the company "intends to proceed once the value-engineering process is complete." This suggests that the pause could last until a revised, cost-effective plan is finalized.
Design Evolution and Community Concerns
The Neutral Edison project has been in development for several years. Local reports, including those from The Daily Reporter, indicate that the tower's design evolved over time. Initially, in 2022, the plan was for a 15-story building. This design was later expanded to the current 31 stories.
"We were sold a project that was going to be 31 stories tall, the tallest mass timber building in North America, and now we’re ending up with something very, very different."
Milwaukee Alderman Robert Bauman expressed concerns about the halt in construction. He suggested that the value engineering process might lead to a significant reduction in the project's scope. Bauman warned that the scheme could be "dumbed down."
According to Bauman's comments in The Daily Reporter, he fears the project could result in "a smaller building, different façade, different amenities, and a different product that cuts the cost." These changes could alter the building significantly from its original vision as a landmark mass timber structure.
Mass Timber and Environmental Benefits
The Neutral Edison project was notable for its planned use of mass timber. This construction method uses engineered wood products for structural elements. It is often promoted for its environmental advantages.
According to Neutral, using mass timber for the building was projected to reduce its embodied carbon footprint by an estimated 54%. Embodied carbon refers to the greenhouse gas emissions associated with the materials and construction processes of a building.
- Mass timber construction typically stores carbon within the wood.
- It can reduce the need for more energy-intensive materials like steel and concrete.
Additionally, the design aimed to cut operational carbon and energy use by 45% compared to similar conventional buildings. Operational carbon relates to the emissions from a building's energy consumption during its use, such as heating, cooling, and lighting.
The pause in construction means that the realization of these environmental benefits is now delayed. The potential for design changes during the value-engineering process could also affect the final environmental impact of the building.
Future Outlook for Neutral Edison
The developer has not yet provided a new completion date. The focus remains on finding cost-effective solutions to move forward. The outcome of the value-engineering process will determine the project's future size, design, and features.
This situation highlights the delicate balance between ambitious architectural goals, economic realities, and environmental considerations in large-scale urban development. Stakeholders in Milwaukee await further announcements on how Neutral intends to resume and complete this significant project.