In the wake of Cheeseburger in Paradise’s abrupt closing two weeks ago, city officials and the leasing company of the former tenant were set to meet this week. At the same time, one of two economic development initiatives designed to improve the downtown area, has yet to benefit one business since starting in the fall of last year.
City officials were scheduled to meet with representatives from NEI Management & Development of McHenry Thursday, the property management company that represents landlords in Metropolitan Square that lost tenant Cheeseburger in Paradise, Michael Bartholomew, director of community and economic development said. The Jimmy Buffet themed restaurant closed March 11.
Bartholomew said they would discuss the leasing company’s vacancy rate, what its plan is to reoccupy those spaces, what challenges the company faces and if there is anything the city can do to help.
Metropolitan Square occupancy rate less than 80 percent
Tom Fremarek, managing partner of Cheeseburger in Paradise, which was located at 1472 Market St., told the Des Plaines Journal that increases in rent the last two years caused the business to be too expensive to operate.
Mike Neises, property manager for NEI Management & Development of McHenry, told the Daily Herald the rent increases the last few years were caused by Cook County raising property tax assessments.
At the meeting city officials also will ask representatives from the leasing company what exactly was the difficulty with Cheeseburger in Paradise that caused the business to close, Bartholomew said.
“They may not know, but we’ll ask the question,” Bartholomew said.
The downtown retail space formerly occupied by Cheeseburger in Paradise joins a number of other vacant properties in that area.
The Daily Herald reported Metropolitan Square’s occupancy rate is slightly less than 80 percent, according to property managers, with the Shop-N-Save grocery store covering a third of the total square footage.
In a , a brief survey of one square block in the downtown area showed approximately half of the storefronts vacant.
City paid $228,569 in business assistance between 2005-2010
The city offers two economic development initiatives to encourage business, Bartholomew said.
The initiatives are funded by tax increment financing funds, or TIFs. A TIF district is created when a local government freezes the tax base on properties within a certain area. All new property taxes in that district, which are generated by an increase in property value since the year the TIF started, are put into a special fund established for redevelopment projects within the district.
The first economic development initiative, The Façade Improvement Program, financially assists businesses located downtown, in the TIF 1 district, to improve facades with signs, awning, lighting and paint, Bartholomew wrote in an email to Des Plaines Patch.
The city approves grants for up to $5K for improving facades, after which, funds drop to about a third, said Gay Miezin, producer at Stage One Productions and the project manager overseeing the Des Plaines Theatre renovation.
The theatre was a participant in the Façade Improvement Program last year, according to a map Bartholomew sent Des Plaines Patch.
Thirty-four businesses were approved and followed through on façade improvement projects with grants from the Façade Improvement Program between 2005 and 2010, for which the city paid $228,569, Bartholomew wrote in the email.
The second grant, the Downtown Business Assistance Program, approved by the City Council in September, is similar to the Façade Improvement Program, but allows flexibility for interior work, Bartholomew wrote in the email.
Bartholomew wrote thus far no businesses have been approved for, or completed, the Downtown Assistance Program.
City loses economic development coordinator
Bartholomew, who took the position of director of community and economic development in January, said two other positions in his department, deputy director of community and economic development and economic development coordinator, were eliminated due to budget cuts.
The economic development coordinator was responsible for proactively encouraging businesses to move to Des Plaines, Bartholomew said. With that position gone, no one is doing that job, he said. Bartholomew said his role was to supervise the building and planning divisions.
“It’s hard to say how much of a difference it could really make,” Bartholomew said. “When any city or any organization has some financial difficulty you have to go and tighten your belt, and you have to do what your core business is and you have to continue to do what you do best. And we are providing those core services still, and having an economic development coordinator – not every city has one of those. I think Des Plaines was fortunate for quite awhile to have one.”
Business owners may be in the dark about city assistance
Miezin said it took her a long time reviewing the city’s website to find information on the city’s two economic development grants. She said she was aware of one new business owner, with plans to open Miner Gyros, 1470 Miner St., near the theatre, who was unaware of the grants until she told him about them.
“I don’t think [the Downtown Business Assistance Program] has been very well publicized or advertised,” Miezin said.
Dimitra Zafiriadis, co-owner of Spa Di Da, 1473 Market St., said certainly if the downtown area had more occupancy, that would increase traffic. But she said the area currently has a decent amount of traffic, and the city has brought a decent amount of exposure to Metropolitan Square.
“From a business standpoint your business ultimately has to speak for itself,” Zafiriadis said.