Tinley officials considering $9.9 million redevelopment deal for Brixmoor property on Harlem Avenue

By Jon DePaolis

TINLEY PARK, Ill. – Village of Tinley Park officials are considering giving out as much as $9.9 million funded by tax increment financing and sales tax money in a redevelopment deal aimed at revitalizing a shopping plaza on the northeast part of town.

The Village of Tinley Park Board of Trustees heard about the incentive deal Tuesday, Sept. 1, during a Committee of the Whole meeting. Trustees voted 4-2 to move the item onto the Village Board, with trustees Cynthia Berg and Michael Glotz casting the dissenting ballots.

Redevelopment planned on Harlem Avenue

The redevelopment deal was requested by Brixmoor IA Tinley Park Plaza, LLC – the developer who owns the properties from 15903 Harlem Ave. to 16205 Harlem Ave. The properties are located just south of 159th Street.

Village Treasurer Brad Bettenhausen said Brixmoor is proposing renovations and upgrades to the plaza at an estimated cost of $21.9 million. The proposal will include demolition and reconstruction of about 87,000 square feet of the existing shopping center.

There also are two retailers who are under contract that will take up about 63,500 square feet of the new retail space, Bettenhausen said.

Developer in need of financial assistance

Bettenhausen told the board members that the redevelopment project hinges on the incentives proposed.

“But for the Village’s assistance toward the project, the renovations would not be able to move forward,” he said. “The current tenant interest in the center would probably be lost and the shopping center would adversely be impacted, as well as the Village.”

Bettenhausen said the agreement – if approved – would be in an amount not to exceed $9.9 million or 50% of the actual project costs — whichever is lower.

The financial assistance would be a combination of TIF revenues generated from the shopping center plaza and the 1% municipal sales tax generated by the businesses located in that plaza for a period of 10 years.

“A maximum of $8.1 million will be from reimbursement from TIF-eligible costs and repaid from the TIF increment generated, while the remainder of $1.8 million will be paid from incremental sales taxes,” he said.

However, Bettenhausen added that the mix of TIF-funded incentive and sales tax incentive could change depending on what the actual costs end up being.

“[But] the sales tax component of the incentive cannot exceed $2.5 million,” Bettenhausen noted.

Background of the Brixmoor property

The Brixmoor property opened in 1974 and was expanded between 1984 to 1988, including the addition of the Walt’s and Builder’s Square as primary anchors of the plaza. Bettenhausen said Brixmoor has been the primary beneficial owners of the shopping center since 1995.

From 2003 to 2006, the south end of the plaza was renovated — including the demolition of the vacant Builder’s Square site, reconstruction of the tenant spaces and construction of new building along Harlem Avenue. From 2015 to 2016, a similar project was undertaken by the developer on the north end of the shopping plaza.

Bettenhausen said the shopping plaza has about 251,000 square feet of retail space. Of that, about 83,000 square feet — or 36% — is currently vacant.

“There is a possibility of additional vacancies,” Bettenhausen said. “This is where the owners are looking to change that course and revitalize the center.”

He said the developer came to staff a year ago with “an ambitious plan” to renovate the center. At that point, they were hoping to move forward with a dining and entertainment focus. However, the effects of COVID-19 and other issues changed the plan.

“The renovations are still on track, [but] they now have some interest from some retail tenants that they have under contract and that they are looking now to move forward with the project,” Bettenhausen said.

Trustees give their input

Trustee William Brennan said he thought the redevelopment plan was a “great step forward” for the shopping plaza.

“I know it’s an ambitious plan, but this is really the entranceway to Tinley Park,” he said. “So, this is a much-needed facelift for that corner of town. I’m really looking forward to working with them.”

Glotz said he thought the Village staff did a great job on the agreement but was not on board with the amount of monetary assistance that was being proposed.

“I’m happy that it is going to be refreshed,” Glotz said. “I just struggle with the percentage of money that they are receiving.”

Berg also voiced her opposition to the redevelopment agreement, stating she is opposed to taxpayer money being used to fund corporations.

“With the Village budget being in free fall as it is, I don’t feel that this is the right move at this time,” Berg said.

Next steps

During the discussion, Andrew Balzar, a representative for Brixmoor – who participated in the conversation by phone – said the shopping center has struggled over the years because of the lack of a prominent anchor tenant. Now, with an established grocery store anchoring the redevelopment, it may drive traffic to attract other retailers.

Meanwhile, Bettenhausen said he “truly believes” that the renovation plan will revitalize the center “and that we will see a great project come out of this.”

Prior to the vote to move it to the Village Board meeting – at which a first reading was held on the item on Sept. 1 – Glotz pointed out that by doing nothing, the shopping plaza could be in trouble.

“Without [the assistance], the strip mall just could keep deteriorating,” Glotz said.

“That is my biggest fear,” Bettenhausen replied.