There’s plenty of talk, but future of former Pheasant Run Resort site remains undecided

A developer’s plans for the former Pheasant Run Resort site in St. Charles are continuing to generate discussion among the city council, but the property’s future remains undecided.

On Monday, Aug. 3, the St. Charles City Council Committee of the Whole considered — but ultimately tabled — a recommendation to approve a planned unit development and a preliminary plan for the site’s redevelopment, to be called The Shops at Pheasant Run.

Preliminary plans for the development include a Chase Bank, a Valvoline Oil Change and a Dutch Bros Coffee, according to city documents.

Located near the city’s eastern edge at East Main Street and Kautz Road, the site is the remaining 33.7 acres of the former Pheasant Run Resort, which shuttered in 2020.

In 2022, a fire engulfed large sections of the resort, causing significant damage. It destroyed portions of the hotel, but crews were able to save the 16-story tower on the property.

The remaining resort buildings eventually were razed. But discussions about redeveloping the property have been going on for years. Parts of the former resort property have been sold off over the years for car dealerships and an industrial park.

This would be the last portion of the property to be redeveloped.

In an effort to develop the remaining property, a concept plan was submitted last year to the city by SC Landman LLC, the property owner entity of Chicago-based developer Vequity. It proposed a project that would include retail, a bank, restaurants and a daycare. The property currently is zoned for business, per the city.

But while the council has been generally supportive of development on the site, some of the specifications of the proposed project have generated pushback on matters like the number of drive-throughs and the possibility of a car wash being located there.

The pitch was discussed by the city council in December, and again was a topic of discussion at the Aug. 3 committee of the whole meeting.

Vequity and SC Landman’s pitch is for the site to be divided into 14 lots for commercial purposes, according to a memo.

Some of those lots already have planned users, including Chase Bank, a Valvoline oil change facility and Dutch Bros Coffee, all of which would include drive-throughs. Three of the other lots are set to be multi-tenant buildings, including two potential drive-throughs.

The remaining eight lots have not yet been settled on, and their development would require future city approval of the preliminary plans, according to the city memo.

According to Russell Colby, the city’s director of community development, the site’s current zoning allows for uses like banks, retail spaces, restaurants, car washes and gas stations. But drive-throughs require a special use approval process. The request from the developer and property owner maintains the existing zoning, but a possible planned unit development would “allow some additional use.”

The proposed redevelopment plans include a request that drive-throughs be permitted on all of the lots, per the city, as well as allow for possible uses like a pet care facility, car dealership and truck stop.

The St. Charles Plan Commission previously voted 6-3 in favor of the preliminary plans, according to Colby, with some conditions — requiring one of the lots to go through special use approval if it isn’t developed as a car dealership, and requiring the traffic study for the project to be updated if there are more than eight drive-throughs. The commission also directed the applicant to work with staff to address pedestrian walkability.

While not part of the approval contemplated on Aug. 3, the developer also is seeking at least $3.3 million in financial assistance from the city to help with “extraordinary site costs,” Colby said.

The property is within the Pheasant Run Tax Increment Financing District, and the city has anticipated that the condition of the site would mean redeveloping it would require TIF support, according to Colby.

A TIF district is an economic development incentive in which the value of a property is essentially frozen, and the extra or “increment” taxes created by developing the property go into a special fund used to pay for costs related to improving the area.

The total estimated cost of the project is upward of $70 million, Colby said, and the property is expected to generate $11 million in TIF increment funds.

But, Colby noted, if the city opts to restrict how the land is used by prohibiting a car wash from setting up there, the developer plans to ask for an additional $1.5 million in TIF funds. The rationale, per the city memo, is that doing so would “eliminate a currently permitted use, reduce the value and economic viability of the project, and require additional assistance.”

Should a TIF agreement be reached, a pay-as-you-go structure would be set up, meaning the city would not front project costs or issue debt to fund the incentive. Rather, new incremental revenue generated from the project would go to the developer to use for redevelopment costs.

At the Aug. 3 meeting, representatives for the developer and property owner addressed some components of the proposed plans, as well as heard feedback from the council.

Peter Bazos, an attorney representing SC Landman, said the petitioner is not asking for uses beyond those already permitted or allowed as special uses in the property’s current zoning. He also pointed out that the development is not next to any residential areas, and said that — though no car washes have been settled on yet — a potential car wash would be located on the lots closer to the planned car dealership. He also noted a truck stop could potentially go in the spot where the proposed car dealership would be, if a dealership doesn’t happen.

Noting that they “recognize the significant history of this former resort site,” Christopher Ilekis, owner and founder of Vequity, pointed to some of what the proposed project could bring to the site — 10 to 12 restaurants, a coffee shop and other retail, for example. Plans include sidewalks and internal pathways, he said, and some gathering spaces and seating areas.

Ilekis said he knows there’s been “a lot of talk about car wash(es) and truck stops,” but indicated that they’re not proceeding with a truck stop at this point, nor do they have a commitment from a car wash.

“We want to see the same users that you guys (do),” Ilekis said.

In addition to some resident pushback at the Aug. 3 committee of the whole and city council meetings, members of the council outlined some of their concerns about the proposed project — as well as expressed support for aspects of the project.

Several council members expressed appreciation for the applicant’s attempts to create greater walkability in the project.

But other matters — like the number of drive-throughs and uncertainty about what businesses will set up shop there — prompted some criticism as well.

Alderman Ron Silkaitis said he didn’t support “unlimited drive-throughs” on the property, but supported the car dealership site.

Silkaitis also was critical of the ask for additional TIF incentive money if the city denies a special use on the site, which Alderman David Pietryla also took issue with.

Alderman Ed Bessner — noting that there’s “momentum” for development on the east side of the city, such as projects like Fox Haven Square — asked how the drive-throughs would affect the walkability of the site and how many would be feasible.

Additionally, several council members also spoke of the development as part of the eastern gateway to the city.

Alderman Ryan Bongard noted there is concern from residents that “we continue to build, you know, the same thing down the same streets,” and asked how these offerings would be different.

Alderwoman Jayme Muenz said the area needs to be redeveloped, but said she wants to see the site be for a use “that actually draws people to our community for some special … purpose.”

“Our eastern gateway should be distinct, unique and different from our neighboring communities,” Muenz said at the meeting. “This would not bring us that. This would bring us just about any suburban area anywhere around here.”

mmorrow@chicagotribune.com