Former AT&T building in downtown Arlington Heights to get new life
A developer plans to pour $2 million into the vacant former AT&T call center in downtown Arlington Heights and convert it into a multi-tenant office and retail building.
Arlington Heights-based Ketone Partners, led by Kyle Schuhmacher, closed on the purchase of the two-story, 57,000-square-foot brick building at 44 S. Vail Ave. this summer and is now making exterior facade improvements, replacing building mechanical systems and updating interior office suites.
The building, which has been vacant since March 2018, would be reutilized at a time when the office vacancy rate in Arlington Heights is at nearly 20%, amid the lingering effects of the pandemic.
Springing hopes on an infusion of daytime downtown office workers, the village board this week endorsed the developer's application for a Cook County Class 7c property tax break, which would lower assessment levels for five years.
Officials predict that once fully reoccupied, the office building could host some 80 workers.
"The downtown area is an area that we need those daytime jobs to support the lunchtime businesses, whether they're restaurants, retail or others," said Charles Witherington-Perkins, the village's director of planning and community development. "There have been a lot of different interested parties that have looked at (the building) and walked away from it for various reasons. It does entail a big investment."
Ketone plans to offer for lease a combination of coworking offices, office suites ranging from 1,000 to 15,000 square feet, studios and meeting rooms. Between the two floors, there's more than 31,000 square feet of leasable space available, as well as nearly 10,000 square feet in the basement.
Some streetside retail also is possible, the developer added.
No tenants have been secured.
Under the county incentive program, commercial property is assessed at 10% of market value for the first three years before rising to 15% in the fourth year and 20% in the fifth year. Normally, commercial real estate is assessed at 25%.
The incentive, which requires the endorsement of the local municipality before final approval by the county board, can be renewed once.
The developer said that without the tax break, the renovation wouldn't be economically feasible.
Officials estimate the property will generate $850,000 in cumulative property taxes over the next five years, whereas it would generate $436,500 if it remained vacant.
Village officials are requiring Ketone to rebate 10% of the firm's savings over the first three years of the five-year incentive. Those funds would go into a special village fund to be distributed to new or expanding businesses that have applied and been approved for a zero-interest loan, or to support other economic development activities as approved by the village board.