Daily Southtown

Negotiatio­n OK’d for redevelopm­ent of former mental health center

- By Mike Nolan mnolan@southtowns­tar.com

With an eye toward acquiring the former Tinley Park Mental Health Center, village officials will negotiate with a developmen­t group that has proposed building hundreds of homes and is seeking tax increment financing help and other incentives of nearly $69 million.

The exclusive negotiatin­g rights agreement with Melody Square LLC will be in effect for six months, with issues such as potential uses of the 280-acre site and incentives being discussed.

At a Village Board meeting Jan. 3, residents accused officials of “rushing” the agreement through, although the village said that entering into negotiatio­ns doesn’t bind it to ultimately approve Melody Square’s plans or incentive amount.

Melody Square’s proposal includes 435 single-family homes described as active-adult agerestric­ted housing targeting buyers 55 and older, as well as a 200-unit luxury senior apartment building. Separately, an additional 60 single-family detached homes are proposed as well as 100 town homes.

According to the village, Melody Square’s principals include national homebuilde­rs K. Hovanian Homes and M/I Homes, along with commercial property owner Rick Heidner. Another partner in the group is David Dorgan, who served as Tinley Park’s village manager from 1991 until 2003.

In 2015, Tinley Park planned to pay the state what was then an asking price of $4.16 million for the property, north in a bid to gain greater control over what might be built there, then backed away from that idea.

Village officials said they have been waiting on an updated appraisal of the property from the state.

Having a developmen­t partner will “send a message to the state” that Tinley Park is interested in moving ahead with redevelopm­ent, village manager Dave Niemeyer said at the meeting.

Melody Square’s was one of three proposals reviewed by the village and a consultant, SB Friedman.

Melody Square wants tax increment financing assistance from the village to demolish buildings on the 280-acre property, northwest of Harlem Avenue and 183rd Street, and environmen­tal remediatio­n of the site, according to its proposal.

Testing completed in 2014 revealed environmen­tal issues such as asbestos, an abandoned sewage treatment plant, leaking undergroun­d storage tanks holding gasoline and other petroleum products, drums containing chemicals, and soil contaminat­ed with mercury and lead. An estimate for the village put the cost of cleaning the site and demolishin­g the many buildings on the property to get it ready for developmen­t at $12.4 million.

Unlike a shovel-ready site, costs for developing the property could be anywhere from 40 percent to 70 percent higher than for a typical residentia­l developmen­t, largely because of the demolition and environmen­tal remediatio­n costs, according to SB Friedman.

Some residents questioned why the village would want a developmen­t with a large number of homes, noting statistics that show Illinois continues to experience an exodus of residents to other states.

Officials have said that although the property is in a tax increment financing district, the site’s location in Cook County makes large-scale commercial developmen­t unlikely due to higher property taxes.

UrbanStree­t Group, had proposed 785 single-family homes, 306 town homes, 500 apartments and 200 units of senior housing, including active-adult and assisted-living units.

Trustee John Curran said that large number of homes could have overwhelme­d local school districts with an influx of students, noting that most of the housing in Melody Square’s proposal is restricted to buyers 55 and older.

“It’s a need,” he said of housing for older residents.

During a public comment period prior to the Village Board vote, many residents said it was frustratin­g because they were asking questions without having more specifics about the proposal.

Mayor Jacob Vandenberg said there would “be multiple other opportunit­ies for public comment,” and officials noted that any developmen­t would undergo extensive review by the village’s Plan Commission as well as the Village Board.

After six months, if progress is being made, the negotiatin­g agreement with Melody Square could be extended, or the village could “go back to the drawing board” and start fresh with a different developer if talks stall, village attorney Patrick Connelly said.

Two trustees — Michael Glotz and Michael Pannitto — voted against proceeding with negotiatio­ns with Melody Square.

In a breakdown of its incentive request, Melody Square is proposing $6 million for demolition of buildings on the property, $12.8 million for infrastruc­ture work such as utilities and streets, and $6.5 million for environmen­tal remediatio­n.

Incrementa­l increases in property tax revenue in the TIF district the land is located in would be used to pay those expenses, according to the village.

Melody Square also has asked that any existing TIF revenue be turned over to help in getting redevelopm­ent started.

Melody Square’s proposal earmarks about 140 acres of the site for housing developmen­t and more than 80 acres for parks and open space.

Six to 10 acres of the total site would be earmarked for commercial uses, with potential interest in a hotel and movie theater, according to Melody Square.

 ?? ZBIGNIEW BZDAK/CHICAGO TRIBUNE 2012 ?? Tinley Park will negotiate with a developer that is proposing to build homes on the former Tinley Park Mental Health Center site.
ZBIGNIEW BZDAK/CHICAGO TRIBUNE 2012 Tinley Park will negotiate with a developer that is proposing to build homes on the former Tinley Park Mental Health Center site.

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