The First Street Redevelopment Project has enjoyed great success to date. Many new stores and restaurants have located there. The public plaza has become a new community gathering place. In addition, the public parking structure serves the greater downtown area with convenient, free parking. Our downtown remains one of the most vital in the western suburbs due to cooperation among the City, property owners, and downtown business owners and operators.
First Street is a project with 5 distinct phases. To date, 2 of the 5 phases have been completed.
Phase 3 of the First Street Redevelopment project was to consist of three mixed-use buildings (residential, retail, and office) and a parking structure located between Main and Illinois streets and the Fox River. The construction budget for the private developer portion of the approved phase is approximately $40 million. There are also approximately $6 million in public improvements for the City to undertake including 100 parking spaces, riverwalk, plaza, streetscape, and street lighting.
Under the terms of the redevelopment agreement, Phase 3 was to commence by March 1, 2009. The Great Recession and resulting impact on the housing market stalled the project. Financing could not be secured by the development team. Representatives of the City and the developer have been discussing Phase 3 regularly in an effort to get the project out of the ground.
In February, 2011, the City hosted a meeting with representatives of 1st Street LLC and a potential development partner, Inland Real Estate Development Corporation, to discuss the First Street project. The purpose of the meeting was to discuss a potential for the parties to joint venture on Phase 3 of the project and to retool it in response to the current economic conditions.
Inland developed a revised concept plan for Phase 3 that would result in changes from the original plan. The proposed buildings would be 5 stories tall (the same as the approved plan) with the 2nd floor office space being removed. The new proposal consists of first floor retail/commercial space and 4 floors of rental apartments above. The number of residences would increase from 61 under the current plan to approximately 125 under the proposed plan. In addition, the footprint of the proposed building would be reduced, providing for additional open space along the Fox River.
Representatives of Inland believe that the project can obtain financing and report that they are ready to proceed in a joint-venture with 1st Street LLC. Both companies are currently discussing the terms and conditions under which they would work together to develop Phase 3 of the project. The target for construction is Spring/Summer 2012.
With the originally approved project, the current economic and financing climate make the project infeasible in the short term. There is no timetable for construction and no timetable for the buildings to begin generating economic activity for the downtown and the TIF. It’s the proverbial “two in the bush.” The upside of moving forward with the modified proposal is that we now have a defined project and schedule. With the modified proposal, we have greater certainty for the project. It’s the proverbial “one in the hand.”
Benefits of proceeding with the proposal include new retail and restaurant space to complement what exists today. It would also increase the number of consumers in the downtown area, resulting in increases in foot traffic and sales. This will support existing stores and help to attract new businesses. In addition, the development of rental units responds to the current mortgage environment, housing market demand, and the project development financing climate.
On Monday, December 12th, the City Council's Planning & Development Committee recommended that the concept be endorsed. On Monday, December 19th, the Council is expected to approve that recommendation and direct city staff and legal counsel to continue working with 1st Street LLC and Inland.
You can view the preliminary drawings of the proposed project here.