DGreport.com

Editor’s note: This is the third and final post about the ATI proposal, which will come before the Village Council Tuesday night. Click here for Part 1 and Part 2.

The proponents

While downtown retailers who oppose the ATI plan continue to register their objections, proponents of the proposal have been working to convince the village council to approve the deal Tuesday night.

The boards of both the Downtown Management Corp. and the Economic Development Corp. already approved the plan by Acadia on the Green developer New England Builders to lease about 10,000 square feet of first-floor space to the ATI physical therapy and fitness center.

Unlike the village’s agreement with Charles Place, which mandates a 75-25 retail-to-service split, the Acadia on the Green agreement allows for the developer to deviate from the 90 percent retail guideline with prior written consent of the village council.

Both Downtown Management and the EDC  say business conditions have changed dramatically since the AotG was conceived and it would be unwise to pass over a long-term service tenant in the  hopes of attracting future retail to space that already  has stood empty for three years.

Downtown Manager Linda Kunze said her board, which consists of four downtown business owners and four property owners,  voted in favor of the proposal after discussing it at length. Kunze had exercised her prerogative to call the special meeting.

While downtown Downers Grove is holding its own compared to the foreclosures and vacancies plaguing neighboring villages, new retail tenants just aren’t in the market right now, she said.

“ATI wants the space” and some downtown retailers are excited about the prospect, Kunze said.

Acadia’s banker may also be enthusiastic. “I do think Bank of America, which has the construction loan, wants to get it closed up and done, too,” she said.

Kunze also responded to complaints from opposition retailers that she was no longer communicating with them, saying it had become impossible to get any work due to the constant interruptions. She also has heard the group is mulling a lawsuit if the ATI proposal is approved.

As for suggestions that a physical therapy and fitness center would be better suited to the Forest Avenue site of the old TCF bank, which includes a dedicated parking lot, Kunze said the owner of that site, Peter Burdi, hasn’t contacted her office to express his interest.

In an interview with the DGreport, Burdi said the condo-retail project planned for the site is on hold. “We haven’t been able to get financing for the units because we haven’t sold any,” he said. “There is no question that banks are putting pressure on everyone.”

Burdi said he had heard about ATI’s interest in the AotG space and had “reached out” to the physical therapy and fitness company, but hasn’t heard back. The present TCF bank building includes 7,200 square feet on the first floor and another 7,000 square feet on the lower level — space he would lease “without question” for the $21 per square foot Acadia is offering ATI.

“It sounds like ATI wants to stay in the (Acadia) building, he said. “It’s understandable as it’s a new building. If you’re going to pay the same rate, a business would rather have a new building where people live,” Burdi said.

Meanwhile, Chris Rintz, the owner of AotG developer New England Builders, told the DGreport that he is able to rent space to ATI at $21 a foot when a start-up retail venture by a sole proprieter would have to pay $26. Credit worthiness and the length of the lease impact the rate charged, he said.

Rintz attempted to market AotG to national retailers for three years only to find the trend in that sector is to pull out of town centers in favor of “lifestyle centers” such as Burr Ridge Town Center.  “I’ve spent the last five years aggressively marketing the space and I have been unsuccessful. ”

Until ATI came calling, he had declined to lease to service businesses, Rintz said.  “I turned away two Realtors and three banks. I refused to even quote them or the space could have been leased up a long time ago.”

Rintz believes ATI meets all the criteria for a vibrant downtown. The business will generate trips, particularly during off-peak morning, mid-day and evening hours, and will add to the diversity of downtown Downers Grove, he said. It will also answer demand from CBD condo dwellers who are “clamoring” for a fitness facility.

ATI also will generate sales tax revenue through the sale of workout equipment and clothing and  refreshments, Rintz said. “It really is two separate and distinct facilities, with 2,000 square feet of non-retail PT space and about 7,800 square feet in the health club.”

As for rumors that he is holding the village hostage by refusing to sign a lease with the Lemon Tree grocery unless ATI is approved, “the Lemon Tree lease is signed,” Rintz said.

The delay was due to the grocer’s operators, he said. “I would have loved to have the lease signed two months ago.”

In the end, the retail guidelines originally specified for Acadia on the Green aren’t being completely tossed aside, Kunze said. The ATI lease would be considered as a variance, with the rest of the open space still subject to the 90 percent, 10 percent split.

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