Water Street hotel-retail plans please those with ties to downtown
By Susan Frick Carlman ~ email@example.com March 7, 2013 8:12PM
Artist rendering of the proposed Water Street project in downtown Naperville. | submitted Nov. 2012
Updated: April 9, 2013 11:07AM
Naperville business leaders this week embraced the step taken by City Council members toward a major downtown commercial development Tuesday night.
In a statement released moments after the council authorized staff to draw up the legal paperwork for the multi-use Water Street District development, Naperville Area Chamber of Commerce President and CEO Mike Evans called the move “a momentous decision in the history of Naperville.”
Planned for 2.4 acres flanking Water Street west of Main Street and just south of the West Branch of the DuPage River, the project will include a 166-room hotel, more than 72,000 square feet of commercial space and a 524-space parking deck. Nick Ryan, president of developer Marquette Properties, said his company plans to have the project in the ground this year.
That’s good news to many of those who do business downtown.
Christine Jeffries, president of the Naperville Development Partnership, took part in many of the discussions among representatives for Marquette, the city and local business owners.
“We’re very excited about the Water Street Project. It continues to increase the vibrancy of the business community,” Jeffries said. “It’s a piece that’s been missing for a long time.”
The Council’s 7-2 decision this week advanced a project initially launched in 2007, pitched as a blend of condominium, retail and restaurant space, plus parking. A resurrected proposal, then including a hotel in addition to the earlier uses, went back before the city’s Planning and Zoning Commission last June. It was kneaded and tweaked over a long series of meetings and workshops spanning the months that followed. Officials’ and residents’ concerns weighed into adjustments that brought down the size and density of the project and satisfied many of the earlier misgivings.
Jeffries thinks the plan’s ultimate form provides a great illustration of the potential of productive teamwork. That’s especially crucial, she said, when a major development stands to bring significant community impact.
“In all these projects of economic development, it’s rare to see a project that doesn’t benefit from public input and discussion,” she said, noting that Marquette’s people paid attention to the concerns they heard. “They take that input and they actually use it. They don’t ignore it.”
Extra caution is needed when the elements in a development come with high stakes. Putting up a hotel is “very expensive,” Jeffries noted.
“Land values are much higher in the downtown than anywhere else, and that adds to the issues,” she said, adding that the parking deck brings additional complexities. “A hotel, on a per-room basis, can be very expensive in an urban area.”
Staying in the new inn should not be excessively costly, however. Jeffries said she’s pleased that the city made a point of encouraging construction of the type of hotel that will have room rates most people can afford. She said the partnership is also happy that the project will create a place people can stay that is near Naper Settlement, Edward Hospital, North Central College and other downtown destinations.
“I think that the hotel meets those needs,” Jeffries said.
If the Council gives final approval to the development next month as expected, the project still won’t be quite shovel-ready. Financing is one of the most significant details yet to be worked out. The city established a tax increment financing district around the Water Street site in 2007, to provide a way to offer economic incentives to prospective developers. Jeffries acknowledged that it’s a sensitive topic.
“I think this one has a lot of nuances to it,” she said.
An agreement between Marquette and the city will most likely be focused on community assets, she said, citing the Riverwalk and the parking structure.
“With this one, those TIF dollars will be used as the municipality sees fit for public benefit,” she said.
According to City Manager Doug Krieger, the TIF district generates municipal income that is tied to the assessments of the properties within it.
“The holder of those funds, and the entity that dictates what those funds are used for, is the city,” he said.
The role of the Water Street revenue in the upcoming project, and other financing issues, Krieger said, have yet to be determined.
“That will be a matter for future public discussion,” he said. “But it was the intention, when the TIF was initially created, that it be used for future public improvements — basically limited for use for assets which the city would hold title to.”
While the Chamber has a policy of not taking a stance on specific development matters, its membership weighs in on long-term visions that stand to have an effect on local commerce. The organization strongly supported the concept of a major redevelopment in the Water Street District, and applauded the leap it took forward this week.
“Projects like the Water Street District are a rare generational opportunity,” Evans said, adding that the completed development will be a boon to the local economy. “We are fortunate that the fundamentals of our community, combined with a developer with the means, desire and capability, can unlock the economic potential of this underutilized property.”