Proposed Plaza Redevelopment Boasts New Start
Northbrook-based GMX Real Estate Group gave Trustees and residents a presentation of its proposed redevelopment plan for The Plaza, that would revert it to its original open-air mall roots, restore “Evergreen” to the name and bring more jobs to town.
Residents have long awaited a remedy for the once-bustling, now-blighted Plaza, and although a deal still technically has not been confirmed, the village heard one option for change Monday night.
GMX Real Estate Group, currently under contract to buy The Plaza’s $20 million mortgage foreclosure note, presented a preliminary plan to restore The Plaza, 9500 S. Western Ave., to its original open-air roots that existed nearly 60 years ago. Current managing and general partner of the mall, The Provo Group previously had plans to do the same thing, but couldn't raise the funds to do so.
“Our plans would be to scrape the mall and start anew,” said Andy Goodman, principal at the Northbrook-based GMX Real Estate Group, whose core business involves shopping center development.
The presentation boasts a plaza half the size of the existing 500,000 square-foot structure, more slots for “safe, well-lit parking” in front of the stores, fewer, but “modern stores,” more landmark signs and more community events, according to James Purinton, managing principal, of Purinton Development, who assisted in the presentation. Additionally, Carson Pirie Scott, who has committed to staying, will be scaled down to a 2-story building instead of its existing 3-story structure. GMX would inherit newly-built Planet Fitness, who signed a 10-year lease in the former Office Depot space at the northern end of the mall.
The company proposed to move the main entrance to 95th Street and relocate Campbell Ave. from behind to lead into the front of the mall.
GMX and its partners say the new development is estimated to more than double the current $1.5 million property taxes to the village. While current retail sales stand at $20 million to $25 million per year, the developers said with their new plan, sales could jump to between $125 million and $150 million per year. The current municipal sales tax is less than half a million, but the new plans could raise them to up to $2.63 million, according to GMX.
Purinton said the project could also help boost the local economy by bringing as many as 500 permanent retail jobs and 1,000 construction jobs to the village.
Although Mayor James Sexton made it clear that “the village has not come to any type of financial agreement” just yet, Purinton said, “We are hoping that we could close purchase this summer.”
At its inception in 1952, The Plaza was an open-air mall anchored by a Carson Pirie Scott, Jewel and Kroger. Originally developed by Arthur Rubloff, the mall became one of the first enclosed malls in the country in the 1960s. At one point, there was a huge slide in the middle of the mall and a movie theater among other features. But in the 1990’s, an “eventual demise of small indoor shopping malls,” according to Purinton, along with economic woes, the 2007 Christmas tree fire that shut down a section of the mall for two months, and the closing of once-anchor Montgomery Wards began to cast a dark shadow on business that it hasn’t rebounded from.
Before GMX purchased the mall, The Plaza's lenders filed a foreclosure suit that put the mortgage note up for sale last June. Within a month, Chicago-based RE Solutions was named the court-appointed receiver for The Plaza.
“Evergreen Plaza has been in precipitous decline since 2007,” Purinton said, noting that occupancy has dropped to nearly 40 percent. According to him, the property is currently barely able to pay for operating expenses, let alone property taxes of mortgage debt services.
“It’s likely that the mall will permanently close sometime in the future,” Purinton said.
Plaza Redevelopment Timeline
If the deal went through, the group first promised to restore “Evergreen” to the mall’s name, a concern raised by Trustee Jerome Bosch. The existing mall would be shut down by Jan. 31, 2013, and demolished with removal of asbestos between March and November of 2013, Goodman said. The project is expected to take about a year to construct, with a “realistic” opening time around Christmas 2014, according to Goodman.
Residents raised questions about the newly proposed development’s consideration to homes on Campbell Avenue, water detention, traffic control, safe access for pedestrians and bicycle riders, and bicycle parking. Goodman said the company hadn’t thought of bicycle access, but told Chicago resident Ann Holt, who raised the question, that the company will take that into consideration. He also said that some sort of buffer would be placed between the homes on Campbell Avenue and the mall. Additionally, resident Robert Baker asked if there will be a community-hiring component during the construction and ramp-up phase. Sexton told him that there will be job fairs in town, giving Evergreen Park residents a fair chance.
After resident Chris Clair asked Sexton whether or not the village would consider a completely different type of development to revitalize that intersection, he remarked, “It’s a possibility…the reality on this mall is that it could possibly be closing in January, 2013, with a $900,000 tax bill be paid by the lenders,” adding that “when it’s a foreclosure and has vacancies, I think it becomes more difficult to make things happen…if this thing happens, it will be much different,” Sexton said.
As an entry into the village bordered by Chicago and easily accessible by public transportation, The Plaza is a prime retail location, Purinton said. According to him, the group has only been marketing the project for just over two months and there is already a high level of interest in buying into the vision, from retailers to people on the development side.
Along with GMX Real Estate Group, Deerfield-based Janko Group, which recently completed a $15 million redevelopment of a Naperville Hotel, would assist in development. GMX brought on Alicon Ventures as its investment partner and Metro Commercial as the leasing agent. Elk Grove Village-based JTS Architects would construct the project and civil engineering would come from V3 Companies, with KOLA, Inc. controlling traffic engineering. DesPlaines-based Peak Construction would serve as the general contractor, with SB Friedman Advisors as the economic consultant.
While the group is only in preliminary talks with The Plaza, Sexton assured residents that “If it doesn’t make financial sense for the tax payers of Evergreen Park, it won’t happen.”
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