$13.4 million sales tax incentive approved for Naperville shopping center redevelopment

The Naperville City Council recently approved a $13.4 million sales tax incentive for the owners of the Heritage Square Shopping Center that opens the door to a massive redevelopment of the site.

Known as Block 59, the proposal from Brixmor Property Group attracted a negative reaction from some community members and city council members who felt the company didn't need the boost to redevelop the land at the northeast corner of Route 59 and Aurora Avenue.

The project also attracted support from entities such as Indian Prairie Unit District 204. Brixmor officials estimate District 204 will receive an additional $2.9 million over 10 years to support its underfunded tax base.

After months of discussion, the plan to create a Block 59 business district ultimately was approved in a 6-3 city council vote on March 21.

Jennifer Bruzan Taylor, Ian Holzhauer and Theresa Sullivan voted against the incentive that will add 1% to the sales tax for businesses in Heritage Square until $13.4 million is collected or 23 years expire.

The 1% added sales tax goes into effect on July 1. According to Brixmor officials, it will take about 16 years to collect the full amount.

The money will go toward demolition, infrastructure and site upgrades. As part of the agreement, Brixmor agrees to contribute up to $250,000 toward the cost of a new traffic signal at the shopping center's northern entrance on Jefferson Avenue.

"I do support the project itself," Bruzan Taylor said. "I just don't support the business district aspect."

Brixmor officials originally wanted a larger portion of the property declared a business district, which would have shortened the amount of time necessary to collect the money. Limiting the scope to just Heritage Square was the compromise that pushed the business district across the finish line.

Brixmor plans to invest $53 million into the project, with $69 million more coming from future restaurant and entertainment tenants. The owners will raze all but two of the existing buildings.

Demolition is slated to begin in July. Building construction is scheduled for July 2024, and the first restaurants are poised to open in 2025.

"It's not an easy call, to be honest with you," Councilman Patrick Kelly said of his support of the business district. "But I do think the project is good."