Shopping center owner invests in the future

As an extensive face lift to a Vernon Hills shopping center begins, the owner and village will be anxious to see if their investments pay off.

Chase Properties Ltd. is relying on a $6 million renovation of its Hawthorn Hills Fashion Square to reverse a slide that has emptied about 60 percent of the tenant space in the roughly 200,000-square-foot center.

"We think updating the center will add value to the center over the long run and will help us attract tenants in the future," said Stuart Kline, president of the Beachwood, Ohio-based firm that operates nearly two dozen shopping centers in the eastern U.S.

Village leaders hope so, too, and in a rare move agreed last fall to rebate up about $1.1 million in sales tax to Chase over a 20-year period.

The rationale was a smaller cut would be better than a bigger piece of something that continues to shrink. Should sales exceed expectations, the deal will end when the rebate amount is reached.

The village also granted changes for signs and landscaping to improve visibility and allow for an overhaul of outdated elements in the 1980s-era center.

Workers have gutted the interior and are going full-bore to ready the anchor slot for Dick's Sporting Goods to replace the departed Wickes Furniture at Fashion Square, prominently located at the southwest corner of routes 60 and 21.

Dick's, which will occupy about a fourth of the space, is the driving force of the renovation. And since the store will be in the corner of the big L-shaped center furthest from adjoining roads, much higher visibility was a prerequisite.

That's why, for example, the Dick's store sign will be twice as large as normally permitted by village code.

New entry signs, building facades, extensive landscaping and other improvements are part of the makeover.

"I think it definitely will be fresher looking," said John Kalmar, assistant village manager. The entry signs at routes 21 and 60 will be "significantly different and more eye catching," he added.

Kline said the Vernon Hills center was the company's only property undergoing a renovation of this scope.

"The motivation for us is we have a strong center that's very well located in a terrific market," Kline said. "It's a significant investment."

Linens 'n Things was another victim of the economy that resulted in a big vacancy at Fashion Square. But that has become a familiar situation in centers throughout the area, where the presence of anchor tenants has an impact on other leases.

Can customers expect to see investments in other centers?

"This could be a trend that we'll see because of the vacancies that currently exist in many of the communities," Kalmar said.

Owners aren't necessarily willing to expand but may make improvements if cash flow allows, he added.

Dick's opening and the completion of the renovations are anticipated at the end of summer.