Suburb Advances Controversial TIF Plan

Trustees Monday night fell far short of suggesting that drastic measure for the 163,000-sf retail center that is the lynchpin to the village's efforts to revitalize the south end of Arlington Heights Road much like a TIF district did for an area at the intersection of Rand Road. In approving creation of a TIF district and redevelopment area by a 6-3 vote, trustees stressed the move is a long way from condemnation, and urged village staff members to work with tenants of the shopping center.

While voting for the TIF plan, Trustee Joseph C. Farwell suggests the owner of International Plaza, Agolf LLC, could be involved in its redevelopment. However, Village President Arlene J. Mulder cited the owners' resistance to the plan as one reason for voting against it. Owners, as well as their tenants, have opposed the TIF plan at public hearings.

Agolf LLC bought International Plaza for $3.6 million in February 1995, when it was 72% vacant. Occupancy now is 98%, representatives of the owners said recently. Since the January 2001 appraisal that pegged the value of the property at $5.3 million, nearly $1.2 million in tenant improvements have been done, and rent renewals have been at a 15% higher rate. Robert Gildo, a representative of Agolf, says the appraisal's purpose was to reduce the owner's property taxes, and conditions have changed since it was done in late 2000.

The village may spend as much as $22 million, the bulk of it in acquisition, demolition and relocation costs, over the TIF district's 23-year life. Meanwhile, the market value of the 35-acre area is projected to rise from nearly $18 million to as much as $100 million during that time. Property taxes would increase from $481,526 in 2001 to as much as $2.7 million a year, while sales could jump from just under $12 million in 2001 to $70 million, according to village projections. The village collects 1.5% in its share of sales tax revenue.

International Plaza's sales were $10.2 million in 2001, or $63 per sf, and are expected to rise to $11.8 million, or $73 per sf this year. However, the village envisions a retail development producing sales in the neighborhood of $200 per sf to $300 per sf.

"International Plaza should be producing much, much more money than it is," says Trustee Virginia Z. Kucera. "Nothing has been done in that area in quite a while. I would've preferred International Plaza look the way we want all of our shopping centers to look."