Is there any speculation on the real reason the work on the Arcade building stopped? Earlier this year I heard that Grumpy's and Chew Chew were going to have to move out at the end of August, then September, then October. Then I read in the Landmark that major construction was being put on hold until next year primarily due to rising construction costs and would not move forward until spring. Is there some seasonality to construction costs that will make the project less expensive in the spring?
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Arcade Building?
(25 posts)-
Posted Sunday Dec 3, 2006 20:00 #
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Could the reason be that the developer smelled TIF money in the wind and wants a piece of the pie? Our Village officials responded with a hastily called special meeting at 8:30 in the morning to make this happen. Why should a developer invest his money when the taxpayers dough is readily at hand once the TIF is in place? This is a no-brainer.
Posted Monday Dec 4, 2006 08:44 # -
I guess I still have a hard time understanding where the money comes FROM to give to the businesses. Assuming a property owner has intentions of redeveloping a property (as the Wexford Development group intends to do with 1 Riverside Road), how do they get the money that is set aside within a TIF district? It seems like the village has to promise, with an note, to share some of the TIF money, once they have it. (Is it just straightforward negotiation on how much money is agreed to?) Then, based on that promise, the property owner does their rehab/renovation, with their own money? Then, when the improved property is reassessed, the incremental tax benefit goes into the TIF trust, and the TIF rebates the agreed upon amount to the property owner/developer? Is that accurate?
Posted Monday Dec 4, 2006 10:39 # -
I don't see how this company working on the Arcade can get any money from the TIF since it cannot pass the "but for" test. Their work has already begun. I doubt the oversight agency for TIF would allow that to go on. They may as well get back to work. I believe the TIF money comes from the taxpayers of the State of Illinois - more hidden costs.
Posted Monday Dec 4, 2006 22:44 # -
Catherine, the Arcade building owners CAN get TIF money even though their work has begun. And Jim, there is proof that the Arcade Building developers smelled TIF money. The fact is that the Arcade building owners had a special meeting w/ the Trustees on the morning (usual Trustee meetings are in the evenings) of September 6, 2006 where Resolution 62 was approved. It's in legalese, but it basically says, if a TIF becomes an ordinance in the future, the Arcade owners would get their share of the TIF monies for work they do now on the building. It seems so underhanded.
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You can read the two page document at
http://www.riversideinfo.org/wp-content/uploads/Resolution62.pdfPosted Saturday Dec 9, 2006 09:06 # -
That doesn't pass the smell test to me, but I think that is for the Office of the Comptroller of Illinois to oversee. But, it is better than allowing a certain other party, widely held in ill repute for failure to maintain properties, from buying it. Still, it would be best to have had someone reputable and well-funded and able to finish what they started.
Posted Monday Dec 11, 2006 05:29 # -
Just recently the subject of the Arcade development was dropped from the Riverside Village web site. Why? When will the developer reappear to ask for more concessions - maybe a forth floor variance so he can add three more condos to the pile? After all, he doesn't have to worry about providing parking, he can buy out of that for just $5,000 a space. The ownership of that building is partly in the hands of the previous owner, and it is not inconceiveable that they will get attempt to package all the concessions and variances they can extract and then peddle the project. This deal was set to go and the Village queered it by raising this TIF proposal. They haven't handled one single project correctly to date.
Posted Wednesday Jan 3, 2007 17:41 # -
What this discussion neglects is that there are significant carrying costs that are being absorbed by the owner of that building while the project remains at a standstill. These carrying costs (i.e. mortgage, taxes, insurance, utilities etc..) are significant and as time goes by these costs far outpace any potential inducement they may get from a TIF. While the initial inclination may be to conclude that the project is at a standstill solely because the developer smells TIF money,a simple project viability analysis debunks that theory. The reality is that the developer greatly underestimated the amount of refurbishment that this building needed. To put it in simple terms, he overpaid for the building and now cannot undertake an economically viable rehab of the building. As I have stated in another post, part of me wants to just say too bad. However, whether we like it or not, his predicament has a significant financial and aesthetic impact on the Village. Given the uncertainty surrounding the building, the businesses in the building have or will shortly be relocating out of town, most of them on a permanent basis. Not only will we lose some very valuable sales tax revenue, but we run the real risk of having a completely vacant and boarded up Arcade building right in the center of our town. Nobody wins under this scenario. The real question now becomes, does it make sense for the Village to provide this developer with some TIF incentives so that we can kick start what was a very well thought out and tasteful rehab of a very historic and key building in our town? The answer seems pretty obvious to me.
Posted Wednesday Jan 3, 2007 18:54 # -
If the owners of the Arcade Building can not afford to carry it, they should sell. That's pretty obvious to me.
Posted Wednesday Jan 3, 2007 21:30 # -
Holly,
Who is going to buy it given the conditions that have been uncovered, Kafka? And then what? If an established and well capitalized development firm like the current owner of the Arcade building can't make the redevelopment of the building work economically, then it is highly unlikely that anybody else will. We have to stop focusing on what things should be like in an ideal world and deal with the reality of the situation. Without a TIF incentive the Arcade building will not be redeveloped in the forseeable future and will likely be completely vacant within months. Do we really want a replay of the Hennigers building, where a key building in the Village lies vacant and its appearance steadily deteriorates? Or do we want to move forward with the TIF and kick start the redevelopment plan that was in place to essentially make the back half (east exposure) of this building look as beautiful as the front end of the building? When you consider all of the factors involved (financial and aesthetic), the choice is pretty simple.
Posted Wednesday Jan 3, 2007 22:55 #
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