Years of neglect and a parking lot deteriorated by rain water detention has made the neighborhood shopping center at Chicago Avenue and Olesen Drive “blighted,” qualifying it for special Naperville tax to fund repairs, a consultant’s report says.
Upscale Heinen’s Grocery Store wants to buy the 7-acre strip center formerly anchored by Butera Market and is asking the city to collect an extra half percent sales tax from purchases made at businesses there to help pay for stormwater improvements on the property.
The Naperville City Council members will decide Tuesday if it wants to proceed with a request to designate the property a business district and schedule a hearing Oct. 4 to receive public input on the plan.
According to a report done by consultant Kane, McKenna and Associates, the buildings at 1256-1290 E. Chicago Ave. were constructed more than 45 years ago and there’s been little investment in upgrades since, contributing to the shopping center’s high vacancy rate and impeding its redevelopment.
Lease rates there are lower than other grocery-anchored strip malls in Naperville, and 80% of the center’s 68,000 square feet of retail space is vacant, the report said.
In addition, Butera grocery sales never met potential they could have at that location because of the location’s conditions, consultants found.
Buildings need tuckpointing and show signs of deterioration, including cracks in the walls, mold and mildew, the report said The metal car barriers and fencing around the rear dock are rusted, some curbs are broken and the parking lot needs repaving.
The problems stem from chronic flooding in the parking lot, where water stands for several hours until it can be drained through a pipe that’s too small for the water it needs to funnel, the report said. The pipe size was based on city standards in 1974, when the center was built.
In addition to the center’s physical condition and the health issues caused by standing water, the situation also creates safety issues for pedestrians and vehicles, especially in the winter, the report said.
To resolve the stormwater problem, Ohio-based Heinen is proposing to elevate both the lot and stores so the water can drain into underground vaults.
The company also plans to improve the shopping center by demolishing obsolete structures, constructing new buildings better suited for the site and adding a new parking lot and landscaping.
Because the stormwater improvements add millions of dollars to the redevelopment costs, Heinen is pushing for the added tax collected through a business district to fill the funding gap so the project can proceed.
Officials say no more than $4.4 million — $3.4 million for site preparation and improvements and $1 million for professional and miscellaneous costs and contingencies — would be collected over the 23-year term of the business district.
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The developer would pay for all the improvements, including stormwater and detention needs, so the city would not have to issue bonds or find a revenue source to cover the debt.
Heinen is a family-owned supermarket chain with Illinois stores in Bannockburn, Barrington and Glenview.