Background
The Village Board previously adopted the Hickory Kensington Tax Increment Financing District in July, 2014 in order to implement the redevelopment plan for the area. These efforts led to a Redevelopment Agreement between the Village and 4 North Hickory, LLC for the construction of a 76-unit apartment building with approximately 3,500 square feet of commercial space that is currently being constructed at 4 Hickory Avenue. Village Ordinance 18-024 was formally adopted and the agreement was signed on June 18, 2018. Among the terms of the redevelopment agreement was the land north of the Campbell Street roadway would be acquired by the Village from the developer for $700,000.00. The purpose was to landbank the excess property for possible future development.
To date the developer has made significant progress in the construction of the building as well as the public improvements eligible for TIF funding.
As per the Redevelopment Agreement the Village was provided the opportunity to review all environmental studies and the purchase would not take place unless the Village is satisfied with the environmental. To that end the developer created a remediation plan that addressed Village concerns based on a third-party environmental review. As a result, the developer was issued an Environmental No Further Remediation (NFR) Letter from the Illinois EPA based on the remediation plan.
The developer and village were restricted from conducting any investigation, through soil borings, or remediation along the alignment of the freight rail spur on the western edge of the property. Out of an abundance of caution the Village retained environmental consultant developed a cost estimate in the event remedial actions may be needed if the rail spur is decommissioned and removed at a future date. The cost estimate was used to negotiate the purchase price accordingly from $700,000.00 to $620,000.00.
Village staff has coordinated through Village Counsel on a final negotiated Real Estate Contract, attached for review, outlining all the requirements for closing, including but not limited to:
1. All completed work that meets the requirements of the IEPA NFR letter.
2. An updated property survey.
3. All other elements required of closing.
Recommendation
It is recommended that the Village Board approve the attached Ordinance Approving a Purchase and Sale Agreement for, and the Purchase of, Certain Real Property at 6 North Hickory Avenue for a purchase price of $620,000.00, and to authorize the Village Manager to execute a Real Estate Contract with 4 N. Hickory, LLC. for the same.