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Which Firm Will Develop Hahn?

Consultant says a four-story option is not viable, but alderman wants to keep that option open. Final decision coming later this month.

Lincoln Properties proposal (Courtesy of City of Elmhurst)
Lincoln Properties proposal (Courtesy of City of Elmhurst)

By Carol Kania Morency

Elmhurst City Council positioned itself Monday to make a final decision on one of two developers—Lincoln Property or Morningside Group—to win the Hahn Street development project. The development will encompass a 10-acre area between York and Addison Avenue, just north of Hahn Street.

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Related: Lincoln Property, Morningside Make Final Pitch on Hahn Street

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On Monday, a city consultant offered a view of the preliminary costs and benefits of each project, comparing apples to apples, and when necessary, apples to oranges.

Both ideas would create rental housing over first-level retail space facing York Road. The Lincoln Property concept is a five-story building, and Morningside has put forth both four- and six-story options.

The parcels are part of the North York Road tax increment financing district, which stretches up to Grand Avenue. Projections related to the use of TIF funds estimate that each proposal would bring in between $18 million and $19.6 million. On the expenditures side, the Morningside plan would cost more, at $11 million, compared to $9 million for Lincoln Property. 

Robert Rychlicki, from Kane McKenna, a consultant the city uses to evaluate its TIF districts, told aldermen that both projects were similar in terms of number of residential units, parking spaces and retail space planned. The differences began with each projects' timelines and benchmarks, the developers’ ability to secure financing, and the potential return on costs for both projects, he said.

Rychlicki said the council also might consider how each project might generate revenue in the City Centre, or how the new parking would fit into what's now available.

"TIF revenue generation does not have to be the whole story," he said.

Fifth Ward Alderman Scott Levin asked if Kane McKenna had an assessment of each groups' financial information. Rychlicki said their proposed rents were in market ranges, but he wondered about some of the preliminary construction costs that had been offered. He added that he hoped these costs would come down in order to improve the picture for potential lenders.

Because the city is offering TIF money, Mayor Steve Morley said the expectation would be that any significant cost reduction—a steep drop in the price of concrete, for example—would be shared between the city and the developer. 

Rychlicki also cautioned that Morningside’s four-story building was not as viable as the six-story concept.

"There's a little less room because there's less revenue,” he said.

Levin asked if the city even needed to keep the four-story plan on the table. First Ward Alderman Diane Gutenkauf said that it should continue to be considered, as the city wanted to see as many ideas as possible from developers. The Council voted on the issue and decided to keep the four-story idea alive for now.

In preparing the requests for proposals for this project, aldermen had created  elaborate evaluation system to help them make a final choice. However, Morley recommended that system be scrapped since the city was dealing with only two proposals, and aldermen would simply be deciding which plan they liked better.

The council will meet again Jan. 27 to make a final choice.

Stewart Levine January 14, 2014 at 06:34 AM
Now that they are going to pass Amnesty for 30-60 million 3rd world illegal immigrants, the good news is that they can fill these Soviet Style apartment buildings with these people who will further crowd the school districts and vote for Property Tax increases from their apartment buildings. You can tell that these developers are licking their chops and so is the city because they both want the money. If anyone cares they should make their concerns known and vote for luxury condos if anything, with another fountain and more retail.
Mark C January 14, 2014 at 11:29 AM
Well they won't be Soviet style apartment buildings. These will be brand new apartments located in the downtown area. Rental market is there, while the condo market is still recovering.
Jorge Zapata January 14, 2014 at 11:46 PM
I don't want rentals in town. Just more people to flood the school district (people allowing members out of district to "just use my rental appt address) and increase demand on our property taxes to support the schools. There is a LOT of out of district students in Elmhurst, and these rentals will only increase this known fact.
Loretta January 15, 2014 at 08:03 AM
I'll take the Morningside's with a 2-BR on the first floor, west side! Where do I sign??? I promise not to flood the school district, to which I already pay thousands of dollars in taxes annually and make no use of. An UPSCALE rental in the downtown area, or a smaller version at the empty area on York at the Prairie Path, sounds great to me.
Loretta January 15, 2014 at 03:07 PM
Just a personal opinion, but I also think Morningside's design is gorgeous, especially from the Addison perspective. The individual front yards with wrought iron fencing certainly looks more appealing than what appears to be a one story brick wall with institutionalized, prison-looking dwellings above it.

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