Des Plaines council to consider new development plan for TIF 6

  • Des Plaines city officials Monday will review a new redevelopment proposal for this vacant city-owned property south of I-90 along Mannheim and Higgins roads.

      Des Plaines city officials Monday will review a new redevelopment proposal for this vacant city-owned property south of I-90 along Mannheim and Higgins roads. Mark Welsh | Staff Photographer March 2010

Updated 2/2/2012 11:38 AM

The Des Plaines city council Monday night will consider a new redevelopment proposal for the long dormant city-owned property near Mannheim and Higgins roads, just south of the Jane Addams Tollway.

An earlier proposal to build two Hyatt hotels on the roughly 5-acre site was shelved in April 2010 after the city council denied developer HNI LLC's request to extend for another year the conditional use permit and variation granted for the hotels project.


That proposal called for two hotels stacked on top of each other, with a total of 313 rooms, and three outlets for restaurants and shops. Construction was expected to begin in April 2010.

Now that same developer has brought forward a different, multimillion dollar redevelopment proposal, Des Plaines Mayor Marty Moylan said without divulging details about the forthcoming plan.

The city council will meet in closed session Monday before the regularly scheduled council meeting at 7 p.m. to discuss the latest redevelopment proposals before acting in open session, Moylan added.

In late 2010, city officials sent out Requests for Proposals to developers interested in the site and received four proposals in April 2011.

The property -- home to Ace car rental, a large billboard and a former TraveLodge -- falls within Tax Increment Financing District No. 6, which was created in 2001 to spur redevelopment in the area east of Mannheim Road, and north of Higgins Road on both sides of the I-90 tollway.

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A TIF district captures increased property tax revenue from redevelopment -- money that normally would go to taxing bodies such as schools -- which can be used to defray costs of redeveloping the area.

The city borrowed $10.4 million to buy land and for other redevelopment costs, which was to be repaid through TIF district revenues as the area redeveloped. Officials originally had agreed to sell the property for $2.7 million to Chicago developer Harlem Irving Companies, HNI's parent group.

The property's current appraised value is between $3 million and $4 million, Des Plaines Acting City Manager Jason Slowinski said.

Whether the city will sell the property to a future developer is up for discussion, he said.

Officials have not ruled out the possibility of a hotels development on the site.

"We're dealing with the economic realities of today," Slowinski said. "We want the best project that we can put together. Obviously, revenue is a big component of what we're looking at. We're going to make sure we do what we can to turn this TIF district around and pay off the debt,"


The Mannheim-Higgins TIF was $5.2 million in the hole at the end of 2011, and is projected to have a $5.9 million deficit by Dec. 31.

Officials restructured the debt in the fall of 2009, which pushed principal and interest payments that were due in 2009 out to 2013, and increases the total cost over the TIF district's lifetime to roughly $15 million.

The city made $36,000 in principal and interest payments on TIF 6 in 2011. That goes up to $408,000 this year. By 2013, the debt payment ratchets up to $1.1 million.

Yearly principal and interest payments are projected to rise to nearly $1.4 million by 2017.

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