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Morningside Reps Offer New Vision for Hahn Street Development Based on Changed Economy

Hahn Street plan shifts to apartment rentals.

Elmhurst officials were told on Tuesday that new residents for a proposed development near York Road and North Avenue were still out there, but in today's economy they want to rent rather than own. Whether the city wants to see more rental units downtown remains up for discussion.

Representatives from Morningside Group on Tuesday presented a revised plan for the north part of the downtown tax increment financing district, an area bounded by North Avenue, Addison Avenue, York Road and Third Street and including Hahn Street. A previous plan for the area called for condominiums and retail space, but that was stalled by the downturn in the economy. Taking the new realities of the real estate market into account, the new plan shifts the living space to rental apartments and reduces the amount of retail space.

The $50 million proposal calls for a six-story building with 190 rental units, four rental rowhomes facing Addison Avenue, 362 parking garage spaces, 12,600 square feet of retail space and a public event space facing York Road. Of the rental units, 125 would be one-bedroom and 61 would be two bedroom, with the rowhouses offering three bedrooms. Just more than 100 of the parking garage spaces would be available to the public, with the rest belonging to the apartments. Rents for the units are proposed at $1,490 to $2,340 per month. To see what the floor plans might look like, Strosberg referred aldermen to the group's rental property in Des Plaines, River595.

Morningside is assuming a 65-foot height for the building. Although the city's zoning code currently caps buildings at 45 feet, the fact that this would be a planned development means that Morningside can ask to build a taller structure.

Morningside Group President David Strosberg told the council that the condominium market had declined by 30 to 40 percent since the last plan was proposed, and he does not expect a recovery for at least five years. However, “there is really a strong demand in the Chicago area for rental housing,” he said.

City Attorney Nick Peppers said that the drastic change in the plan would re-start the approval process for the project. Given the need to resubmit the plan to both the Zoning Commission and the Development, Planning and Zoning Committee, and assuming approval, Morningside representatives did not foresee residents moving into the building until 2014.

Aldermen wondered if the city should back up even further and, given the changes in the economy since the previous plan, discuss what they wanted to see on the site.

“This is a project that is going to be here forever,” 3rd Ward Alderman Michael Bram said.

Aldermen told Morningside that they wanted to see a side-by-side comparison of the previously proposed and newly presented ideas.

Stewart Levine October 12, 2011 at 03:18 PM
This plan is horrible for the city of Elmhurst. Apartment buildings like this are an eyesore to the community. They create all kinds of problems for residents. When police respond to a complaint say on a certain floor the response time for other residents diminishes because they have to go all the way up to that floor. Apartment buildings don't exactly foster the type of community that many Elmhurst citizens envisioned in this town. Would Oakbrook or Hinsdale allow for such a project? This is about making a quick buck, at the expense of the rest of us here in Elmhurst. I hope the aldermen read this, and other citizens join me in expressing our wishes against highrise apartments or even more apartment living in downtown elmhurst, or anywhere in elmhurst.
Stewart Levine October 12, 2011 at 03:19 PM
Why not an office building for a Tech company, that will bring jobs to the community?????
Bill Angel October 12, 2011 at 04:50 PM
Strosberg is from Highland Park. Do you think any North Shore community would approve such garbage in the center of town? Do we really want to compare Elmhurst to DeSplaines? How about this?? Open up the process to other "real" developers? Why this hand-picked political crony? How much $$ has this Mayor promised this developer? Is it really over $10 million dollars in land that the taxpayers paid for? This deal is real stinky!
Ron Sebonia October 12, 2011 at 04:58 PM
With all due respect to Mr. Levine, have you checked occupancy rates for office space? Getting financing to "come out of the ground" for office would be impossible. As for rentals being problematic, it really depends on the type of property you're talking about, premium rentals add not only to the tax base for real estate, but people typically spend where they live. What downtown restaurant or retailer wouldn't want more people living in closer proximity? And more spending downtown means more sales tax revenue.
Concerned resident October 12, 2011 at 07:00 PM
Right now there is a demand for rentals. Is this going to continue for awhile? Probably. However this type of development in that particular location may be a little drastic. It just doesn't seem to conform to Elmhurst standards. It appears that it will be a very densely populated complex. Is this the right location for something like this? I know Wheaton allowed a very dense development in downtown on the south side of the tracks that I have been told by local residents they feel was a huge mistake. I hope our city will review this proposal and look for something more suitable for that location. Switching to rentals from ownership is a big deal. I do agree with one thing, whatever is built there will be there forever. I think Elmhurst Place apartments have been pretty successful. Also, Elm creek is nice. It will depend a lot on the management company chosen to oversee the property if it does go the rental route. A good management company can make all the difference.
Bill Angel October 12, 2011 at 07:52 PM
CR, I take issue with your assertion that there is demand for this premium rental price point. NONE exists as demonstrated by the vacancy rates at Elmhurst Place and Elm Creek. Don't forget the 18% unemployed too. Ronnie, any increase in the tax base will not help us poor saps now, not one iota! It's in a TIF slush fund that has wreaked havoc on our schools. If the Mayor proposes to shut down the TIF now, only then would it increase the tax base. Help the tax base? Show me where your taxes have ever decreased under any circumsrtances? Home values down, City taxes up!
Darlene Heslop October 13, 2011 at 03:50 AM
this proposal was designed by strosberg to get him out of the deal - the end. he's done, wants out - he can't afford to do the "original deal". the council is dead-set against something like this. pete d. made the statement that "hahn street would already be built if i was mayor... ." - he probably told strosberg that "hiz guyz" would vote for whatever was proposed - even something as ridiculous as this - joke's on pete - this is a horrible proposal and for once, the council agrees. it's time to start over w/a new rfp and go from there.
Jim Court October 13, 2011 at 02:07 PM
What about a mixed use development with a business hotel as an anchor. This would create traffic in the downtown area and give broader exposure to our community. A retail and housing mix could be a part of the development. Did any of you catch the pointed attack upon some of you, especially on Darlene?
Susan Smentek October 17, 2011 at 03:45 AM
I believe that the City Council should take a step back and return to the proposal process. I live very close to the Hahn Street site. Our neighborhood has been through enough transient residents with town homes that are constantly on sale on Addison and on Larch Avenues. Renters exist in the Market Square development. I'm under the impression that seniors have not lined up to sign leases at the apartments built on Third Street. This type of development would be a blight on the community. Plus, why are they asking to more than double the number of residents in the new proposal? If they can't sell 82 condos, why can they rent 190 apartments, at rental rates that are higher or on par with what a mortgage payment would be? We need and deserve a useful and lovely development on the Hahn property. 65 feet is too tall for a property that faces a neighborhood of single family homes! I urge Mayor DiCianni and the council members to deny this proposal.
Darlene Heslop October 17, 2011 at 03:55 AM
so that the police can conduct "stings" in downtown elmhurst? no thanx. this needs to go back to the drawing board. period.
Darlene Heslop October 17, 2011 at 04:09 AM
i agree. i think that the joke's on pete d. strosberg knew going into tuesday night's meeting that no one was going to want what he proposed - notice how there are no "handouts"? c'mon...strosberg knew going in that the council was against rentals, that the retail was significantly scaled back, and that the only way he was going to get out of this was to propose something so ridiculous that everyone just cried "uncle" and start the rfp all over again - good for him. now, maybe someone will come in and actually have the $$$ to finally get this thing off the ground so the city can stop putting all the monthly carrying costs down the drain.
Bill Angel October 17, 2011 at 04:02 PM
Ms. Heslop, Mayor DiCianni has an obligation to present the revised proposal to th CC and the community. If Mr. Strosberg wanted out of the deal all his company would need to do is write a letter stating so. Are you refering to the "handouts" AKA, cryonism capitialism off the backs of us poor sap taxpayers? I'm told Strosberg is counting on the City Council giving away the entire property worth over $10 miilion dollars that taxpayers paid for. I think you're wrong on this one! Pete gets what he wants regardless of wht the community thinks.
Jim Court October 18, 2011 at 02:19 PM
It is relatively easy to get what you want when you are in a position of control. You control favors, appointments, contracts, hiring, awards. You have a huge public forum and are given many opportunities to speak before others. Appearing to be friendly and of good appearance also go a long way to gain support. How would you interpret or add to what I have said?
Darlene Heslop October 19, 2011 at 08:07 PM
strosberg is under contract to do the project and there are clauses in there that if he wants out, it isn't just a matter of "writing a letter and stating so."...if he "pulls the plug"...he has to pay the city $$$...obviously...he's trying to avoid doing this. so what he did was make a pitch for a different development so far out there (and by no handouts i meant no supporting documentation for the aldermen and audience, which he provided in previous presentations when he was trying to actually get the thing passed) that it was sure to fail and get the council to just say it was time to start all over again (see alderman york) and release him from the contract. i hope that this is what indeed happens b/c i live near hahn street and want something that will be good - but if i'm wrong, it's b/c yup, pete gets what he wants regardless of what the community thinks b/c the majority of the city council refuses to stand up to him.
Bill Angel October 19, 2011 at 08:30 PM
I would say go get yourself a kite!
Jim Court October 19, 2011 at 08:55 PM
I guess somewhere between the lines there is some meaning but it alludes me
Jim Court October 19, 2011 at 09:31 PM
It seems presumptuous to believe that people who are not professional developers, know more about the market, than the developer.Who has the risk? We are never going to get this built in this dire market if we constantly armchair quarterback. Yes, we want it to be the best it can be, but perfection will never arrive nor can you please everybody. A building like the one proposed might just be the perfect place for Elmhurst College students. Right now it a huge expense for the city taxpayers. Once built, it would contribute greatly to our economy and the downtown businesses. Decision making by committee would drive me nuts !
Darlene Heslop October 20, 2011 at 01:11 AM
w/rents STARTING at $1500 per month (that translates to $14,500 per 9 month school year), i don't know of a college student that could afford that (unless their families were millionaires), let alone "young 20-30 year olds". the assumption is that there are person's w/incomes in excess of $55k that are looking for "luxury apartments" in downtown elmhurst. i make more than that and i can guarantee, there is no way i'm prepared to spend $1500/month for a 1 bedroom apartment. i live in downtown elmhurst. i have a corner apartment w/1 neighbor across the hallway and 1 neighbor next door. in 7 years, i have had 4 different next door neighbors and 4 different neighbors across the hallway. this is a poor proposal and if this is the best that strosberg can come up with at this time, perhaps we need to see if someone else can come up with something better.
Jim Court October 20, 2011 at 02:41 AM
My thought was for two individuals to share a unit. Many Elmhurst College students currently reside at Elmhurst Terrace. Although about the same distance to school, it lacks proximity to our downtown area. I still believe that a hotel would drive much traffic to our downtown. This project needs to progress soon.
Susan Smentek October 20, 2011 at 04:13 AM
If they want to build rentals, why do they need twice as many units? I don't have to be a developer to know that 190 transient residents one block from my house is not in the best interest of my community. Why can't they build the 82 units and call them rentals instead of condos? Why do they need 20 extra feet in height? I saw their DesPlaines rental building. It looks like lot line-to-lot line overbearing hulk of a building to me. Also, $1500 for a one bedroom means that 2 students wouldn't be renting the cheaper units unless they were sharing the bedroom. $1500 is a mortgage payment.
Darlene Heslop October 23, 2011 at 09:09 PM
susan - right on :-).

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