Rental housing proposed for former Haeger Potteries site in East Dundee

The former Haeger Potteries site in East Dundee could be transformed into a $76.3 million mix of townhouses and apartments, including some designated as affordable housing, under a proposal the village board discussed on Monday night.

The 7 Maiden Lane Redevelopment would have 136 units, some of which would be built in a loft building and the former cooling/drying building, according to the plan submitted by Brinshore Development LLC of Evanston.

But the main factory and other buildings would be torn down to make way for two apartment buildings and the townhouses.

The board voted unanimously to authorize village workers to begin negotiating a redevelopment agreement.

The village will consider creating a tax-increment financing district to help finance the construction.

The affordable part

Eighty-three of the housing units would be restricted to households making no more than 60% of the area’s median income. Twenty-seven would be set aside for households making no more than 30% of the area median income.

The state standard of “affordability” calls, in general, for spending no more than 30% of household gross income on housing. In the case of rentals, that includes utility payments.

The costs

The developer wants the village to lend it $4.5 million up front — via a pay-as-you-go bridge loan — to help pay for construction. The village would also sell the site to the developer for $10. The loan would be repaid from increased property taxes generated by the improvement of the site.

Village administrator Erika Storlie said the aid from the village is needed because of possible costs to remediate any environmental hazards found on the site.

She also expressed confidence in the ability of Brinshore to pull the project off. Brinshore has been in business for 30 years.

“One of the important components of the request for proposals was we would actually get somebody (capable). Because the community has been waiting so long for somebody to revitalize the area,” Storlie said.

After viewing drawings of what the buildings could look like Trustee Scott Kunze said he thought they might look too modern. “To me these are so different than what is in the surrounding (residential) area,” Kunze said. Trustee Sarah Brittin agreed with him.

Trustee Andy Sauder questioned why it didn’t show any retail uses such as shops on the first floor of buildings near the river, along the Fox River Trail.

Michael Roane, senior vice president of Brinshore, said the design is preliminary and open to revision. Besides the two buildings it wants to re-use, the plan calls for keeping the Haeger water tower. He also said the company doesn’t think the site could support retail uses.

Storlie said the project would need to be reviewed by the village’s planning, zoning and historic commission, and ultimately approved by the village board.

If everything works out, Storlie estimated the project could break ground in about two years.

Brinshore also proposes using $33.5 million in Low Income Housing Tax Credit financing from the state, an $8.18 million loan from Kane County, and a $13.3 million commercial loan, in part, to finance the project.

The history

Haeger Potteries opened in 1871 and supplied bricks that helped rebuild Chicago after the Great Fire. In the early 1900s, it turned to making pottery and glazed artware.

It shut down in 2016.

The village bought the site in 2022 for $600,000.