The Algonquin village board approved a plan to turn the Riverside Plaza downtown condo project into rentals, with the goal of reverting back to condos in 2018.
Under the plan approved Tuesday night, Riverside Plaza developer John Breugelmans has to begin construction to finish the interior of the building -- which now sits as an empty shell at the corner of Routes 31 and 62 -- within the next 12 months, or the plan will revert to the original planned unit development with 54 condos. The new plan calls for no more than 63 rental units.
Breugelmans bought the building in spring 2011, three years after the original developer defaulted on his loans, and completed its exterior this summer.
However, he needs about $8.5 million to finish the interior, which he says he can get financing for only with rentals, not condos.
"This has been a long haul for the last three years. I think that the goal that we had to put more shoe leather downtown to feed our businesses is going to be met," Village President John Schmitt said.
Trustees Debby Sosine and John Spella voted against the change of plan, saying the village should stick with requiring condos.
Trustee Robert Smith was among those who last month shot down a proposal for 69 rental units, but Tuesday night voted in favor of the lower number of units. "Everybody has a good deal when both parties look at it and feel they got something," he said.
Breugelmans said he has an immediate financing option, which is why he asked the village to discuss the new plan at special committee of the whole meeting before the regular board meeting.
"I feel justified," he said after the meeting. Pending approval of building permits, construction should start in January and be done in seven months, he said.
Village staff worked on a list of 15 detailed conditions to the plan, including that Riverside Plaza be converted back to condos by July 1, 2018, and rental units have a minimum size of 920 square feet, which is "larger than a modest single family ranch home," Community Development Director Russ Farnum said. One-bedrooms will be about a third of the building, the rest two-bedrooms, all with luxury appliances, he said.
The plan will also "ensure that the retail spaces (on the first floor) are set up for success and available to rent, not an afterthought to residential," Farnum said.
Breugelmans has an agreement to lease 43 parking spaces from the owners of Port Edwards restaurant. Under the new plan, if that agreement falls through, the developer will pay $250,000 to the village for costs related to providing additional parking. If Breugelmans fails to pay that money, the village can establish a Special Service Area tax on the property to recoup any expenses, Farnum said.
Also, the developer will repay the village $350,000 for streetscaping if the building is not converted to condo in five years; if the developer fails to repay the money, the village will have an SSA tax option in this case, too.
The conversion deadline could be extended if the developer does a market study at his own cost, and the village board approves the extension, Farnum said.