Some Arlington Hts. trustees balk at International Plaza affordable housing plans

Arlington Heights trustees may be eager to finally see an overhaul of a blighted shopping center where redevelopment has stalled through two decades of lawsuits, economic recession, failed development prospects, and other starts and stops.

But the latest plans for a 17-acre, mixed-use redevelopment of the International Plaza site and some adjacent properties on Golf Road east of Arlington Heights Road faced a stumbling block during its early review with the village board this week.

At issue were concerns that affordable housing units would be confined to a building of their own.

Schaumburg-based UrbanStreet Group - also master developer of the sprawling former Motorola property in Schaumburg - has proposed construction of six, 4-story apartment buildings totaling 265 units to be rented at market rates. UrbanStreet would partner with Northpointe Development Corp. - an Oshkosh, Wisconsin-based affordable housing builder - to develop a pad on the northwest corner of the site for 37 units of age-restricted senior housing to be rented at 60% of the area median income.

The village's inclusionary housing ordinance, approved in 2020, requires any development receiving public assistance to set aside 10% of units as affordable. In this case, though 27 units are required, the developers have proposed 37.

The ordinance also has a provision that calls for the cheaper units to be dispersed among market rate units - and that they must be built concurrently - but the village board can grant relief to those requirements.

Two village trustees and three residents who spoke during the informal early review of the project Monday night argued making those exceptions would violate the letter and spirit of the ordinance.

"My concern is that creates a situation where you are segregating your affordable housing. That it creates an incentive to put affordable housing in one segment of the community and not intermingle it with the market rate," said Trustee Mary Beth Canty, who questioned why the senior building was in a "less desirable" corner of the property.

Jon Dennis, senior vice president of UrbanStreet, said Northpointe officials like the idea of having more visibility along Arlington Heights Road, and "having more independence."

"I would term it, really, in my mind, independence rather than segregating," Dennis said. "That's how they describe it. They said that they have their own project - an age-restricted project to begin with - so a little separation in their mind was a good thing. It wasn't perceived in the way they think about it as a negative at all."

Canty asked whether the senior residents would have access to the amenities offered to those in the six market rate buildings, including an outdoor pool.

"We're in discussions with the affordable developer about that," Dennis said. "What they've described to us is that they're proposing an age-restricted building, and some of the amenities that they want to have to themselves within their building. So we're discussing that, but the idea is that they want to have some independence of their own amenities. It's a topic for discussion."

Trustee Nicolle Grasse asked why the developer couldn't meet the 10% standard within the market rate buildings.

"We've been talking about it being affordable housing, but the name of it is the inclusionary housing ordinance, and it's about including within our units," Grasse said.

But Dennis said the costs to develop the site would make it "very difficult, if not impossible" to achieve that affordability level within the six buildings. But by partnering with Northpointe on the senior building, "this way, we're exceeding it," he said.

Other trustees, like Jim Bertucci, said they weren't as concerned about the location of the building or that it would be built as separate affordable housing for seniors. But he said everyone should have access to the pool.

"I can support a separate building for a lot of reasons, but to say you in that building can't use these other amenities, I'm not sure that I feel that's fair," Bertucci said.

The residential buildings would total 400,000 square feet on nearly a dozen acres on the rear of the site. Three commercial outlots - with some 40,000 square feet of medical office space and 18,000 square feet of retail/restaurant space - would be on nearly six acres fronting Golf Road. Dennis said his firm would partner with other developers to build those commercial sites.

Because the village owns five parcels needed for the large-scale development, village officials said a complex redevelopment agreement is still to be negotiated that would involve land transfers, tax increment financing assistance, and construction phasing.

UrbanStreet has the shopping center property under contract, where only a few small businesses remain in operation. That includes Burger Baron and Sports Outlet Express. Elly's diner closed in recent weeks.

Once UrbanStreet makes a formal submittal of plans to the village in the coming months, the project would be reviewed by the housing, design and plan commissions before returning to the village board for a final vote.

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  The International Plaza shopping center on Golf Road in Arlington Heights - now a ghost town after most businesses have closed - is the site of a proposed mixed-use redevelopment that calls for new commercial and residential spaces. Christopher Placek/
  Most small businesses have closed at the International Plaza shopping center on Golf Road in Arlington Heights. Village officials say the old 1980s-era mall has become blighted. Christopher Placek/
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