The iconic downtown Elgin Tower Building might be purchased by a Wisconsin-based company that would do a complete overhaul, city officials said.
The Stickling Foundation has entered into an agreement to sell the 15-story building to Gorman & Company, which would do the work, Assistant City Manager Rick Kozal said. The art deco building, at 100 E. Chicago St, and the tallest in Elgin, was built in 1929.
"The city will work with the Downtown Neighborhood Association of Elgin to ensure that any business operating in the Tower Building displaced by the redevelopment will be favorably relocated to another commercial space in the downtown," Kozal said.
Messages left for The Stickling Foundation and Gorman & Company were not immediately returned Friday.
DNA Managing Director Jason Pawlowski said he found out about the potential sale on Friday. There are about 20 small businesses in the building, he said.
"We'll work with those businesses and hopefully find a way to keep them downtown -- whether that's an office tower building, or another street-level commercial space," he said.
Councilman Terry Gavin said the sale price being discussed is $1.1 million to $1.2 million, but Gorman would spend "10 times as much as that" to do a thorough renovation.
"It's very preliminary, nothing is finalized," he said. "There's a tentative offer on the table, but it will be a tremendous amount of money to completely gut the building and fix it, because it needs it badly."
Gavin said city officials believe the developer "would be coming to the city looking for some type of incentive."
The building is in a tax-increment financing district, so the city council could decide to allocate some funds to help the developer in the project, he said.
In a TIF district, taxes to local units of government are frozen at a certain level, and the higher property taxes that are generated by the improved property are funneled back into improvements on the property.
"I don't like subsidizing, but sometimes it's appropriate. I won't know where I stand until I see all the details," Gavin said.
Councilman John Prigge said he, too, wants to be careful about whether to give any financial incentives to the developer.
Prigge pointed to the lack of parking as a potential problem in attracting tenants, whether the building is redeveloped into business or housing space.
For Prigge to approve financial incentives, the plan "would have to be something that is going to have to 'wow' me down to my socks," he said.
Gavin said he visited the Tower Building during an open house at Christmastime. "I saw the condition of the building versus the last time I was in there 14 years ago, and it has continued to deteriorate on the inside," he said.
The building's two manual elevators are due for an in-depth, five-year inspection by the end of this month. The elevators had faced condemnation earlier this year because they were overdue for an inspection, which they ultimately passed in February.
Tenant Laurie Larsen, owner of Larsen Logistics, Inc., said she found out Thursday that the building might be sold.
Larsen said she's been there for about five years, and was planning to move out, anyway. Her lease runs out in February 2013.
"I love this building -- the character and the charm and the marble, the old-fashioned elevators," she said.
Still, she wants to leave because of the building's multiple problems. "It's a beautiful building, but it's been so mismanaged," she said.
Larsen cited the elevator issues, along with a leak caused by a pipe that burst about two months ago that affected offices from the 9th through the 12th floors, she said. "I am concerned about mold," she said.
The building's sole maintenance worker was let go about a week ago, she said.