Grand Avenue's $65 million transformation from so-so urban mall to a mix of housing, offices, restaurants and other new uses has begun.

Construction work was underway Monday, with the city issuing a building permit to convert the second floor of the Grand Avenue's historic Plankinton Arcade into the Plankinton Apartments.

Grand Avenue's owners couldn't be immediately reached for more information. And the new building permit provides no details about the Plankinton Apartments.

Co-owner Tony Janowiec told the Milwaukee Journal Sentinel in April that the Grand Avenue's owners were proceeding with plans to convert the second level of the arcade into around 50 high-end apartments. That would amount to a $10 million investment, he said.

The arcade is the portion of the mall between N. 2nd St. and N. Plankinton Ave.

In addition to the apartment project, part of the arcade's street level, along N. 2nd St., was undergoing renovations on Monday.

Information about that work wasn't immediately available. The owners plan to attract commercial uses to that space.

Janowiec's investment groups in December 2015 bought the Grand Avenue and its parking structure for $24.6 million.

In April 2016, they unveiled their redevelopment plans. They include converting the upper floors of the Grand Avenue's newer building, west of N. 2nd St., into offices, with new stores and restaurants on the street level.

Janowiec said this spring that he and his partners were negotiating leases for around 70,000 square feet of the 180,000 square feet of available commercial space in the mall's newer portion.

Two prospective office tenants were close to signing leases but were hesitating because of a strip club proposed nearby at 730 N. Old World 3rd St., Janowiec said.

Janowiec wouldn't name the prospective office users. He said they were a law firm and a children's organization, which together would lease more than 20,000 square feet.

The Common Council in May granted a license for the club. Janowiec hasn't responded to questions about whether those office tenants are still interested in locating at the Grand Avenue.

However, city building permits have since been issued for two other new Grand Avenue tenants: a kidney dialysis clinic and a historic exhibit on Milwaukee's brewing industry — complete with a tavern.

Tom Daykin can be reached attdaykin@jrn.com