First Street Developers Have Until April to Start Work

The St. Charles City Council agreed, albeit cautiously, to grant another round of extensions to the two developers involved in the First Street Redevelopment project, which launched prior to and has languished since the Great Recession.

Public discussions by St. Charles aldermen in recent weeks in particular have highlighted the increased pressure the city faces to shore up its investment in the First Street Redevelopment project. The city in the past year issued bonds to refinances its tax increment financing debt for the project, a move city officials believe will prove to be a boon in the long run but which some residents have criticized as a financial risk.

Supporters believe the First Street Redevelopment project will breathe new life into the city’s downtown district — that the redevelopment not only will increase property values that will go to repaying the city’s debt on the area, but also draw in new businesses to the area, generating more pedestrian visits downtown that will benefit businesses and generate more sales tax and other revenue for the city.

The project was just in the beginning phases when the Great Recession hit, however, bursting the housing bubble and in the process bringing most other construction to  standstill as well.

Consequently, First Street LLC and SMN Development LLC have been hamstrung in their attempts to push through their subsequent phases of the redevelopment project. SMN has the property that once housed the Manor Restaurant at 1st and Main streets. First Street LLC wants to develop the larger section of land fronting the Fox River immediately south of that.

Both developers have asked repeatedly for, and received, extensions to their agreements with the city as they’ve sought financing and explored other options to make their efforts viable. More recently, each requested another extension as the deadlines deadlines approached.

As proposed, the developers had sought an extension until mid-February, but aldermen on Monday unexpectedly extended that even further — to April 8, 2014. But the developers were warned several times by aldermen that there would be no further extensions.

The council on Monday night granted a ninth extension to First Street LLC, essentially giving the developer nearly five months to begin construction of the three buildings and parking deck envisioned for its site.

The council approved an 11th amendment to SMN’s purchase agreement for the former Manor site.

In addition, aldermen appeared to agree on staff-recommended benchmarks the city will expect each developer to achieve over the next five months to assure their efforts are progressing.

In addition, the developers are being required to provide monthly updates to the city staff, who in turn have been directed by the council to provide them with monthly updates.

Despite their growing impatience for movement on the First Street project, aldermen and Mayor Raymond Rogina did express some sympathy for First Street LLC and SMN Development LLC, praising them as stalwarts who have stood behind the project.

“... We appreciate all you have done,” Rogina said, “but this council wants to see this project move to a very successful conclusion.”

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