Lake Zurich development delayed

Lake Zurich's downtown developer said he has the long-sought financing in place to tackle a key area in the village, but he will need a 10-month extension to properly submit plans for his first project.

David Smith of Equity Services Group told the village board Monday of the hardships he faced in finding financing for this type of project in a tumultuous economy.

“We have secured financing for our project; it is beyond a commitment, Smith said. “It's something that has been very hard fought to attain.

The board postponed a vote on the extension until its Oct. 18 meeting, when trustees will have had more time to study Smith's timeline, and an absent trustee and the mayor will be present to have their say on the matter.

It is the latest chapter in the controversial downtown redevelopment plan that calls for razing and rebuilding nearly all existing structures along both sides of Main Street from Old Rand Road west to Lake Street. They were to be replaced with two- to five-story buildings with ground-level retail and condominium/offices above.

The project has been beset by problems for several years, mainly due to the housing market slump and problems obtaining financing.

The village's contract with ESG, signed after heated debate in February 2009, gives the Barrington-based developer four opportunity periods during which it has the exclusive right to buy village property in specified downtown blocks.

ESG is required to file a detailed project plan by the end of each opportunity period. The first one was set to end Sept. 30, 2010, and Smith has asked for it to be extended to July 20, 2011.

The delay is largely due to the lack of financing that was only recently remedied. To pursue substantial development, ESG needs to buy public and private property along the underused lakefront.

The village is providing ESG the public property at a bargain, but private property will be more expensive. With a financing plan in place, Smith said he can now begin acquiring that land.

Smith did not provide details as to a total amount being financed or the arrangements that were made. He did say it is significant enough to take projects from infrastructure and planning through construction.

Village board members were happy to hear financing has been lined up but expressed concern about adding 10 months to the opportunity period.

“The concerns of the public that here we are after Sept. 30 with nothing, we need to make those concerns vanish, Trustee Richard Sustich said.

Smith said he wants to keep the public up to date through the ESG website. He added that financing is ready to go for property acquisitions to begin and he wants those purchases set by the end of the year. He would not say when construction might begin.

Smith emphasized another reason an extension would be necessary his intent to look at the full picture of downtown redevelopment, rather than tackling a small parcel to quickly meet his deadline.

“We went through a series of developers looking at piecemeal projects, but there wasn't a continuity, Trustee Jim Johnson said. “Downtown is a blank slate. Downtown is ready for a city within a city concept.