City of DeKalb makes moves to buy Hunter Hillcrest apartment complex as part of landlord settlement

DeKALB - The City of DeKalb has declared its intent to buy Hunter Hillcrest apartments, pending city council approval, the first of such an action following a settlement agreement with local landlord Hunter Properties.

The mixed-use rental, retail building at 1011 through 1027 Hillcrest Drive is one of four rental properties, owned by Evanston-based Hunter Properties which the landlord is required to by April of 2023 as part of a recently-approved settlement agreement between the City of DeKalb and the property owner following years of controversy involving concerns expressed by city staff, official and tenants over poor quality of living in the spaces. The landlord’s properties at one point were the subject of nearly 500 code violations in DeKalb County courts. The settlement, which was approved by Hunter Properties and a unanimous city council vote April 26, includes the required sale of Hunter Ridgebrook apartments at 808 to 832 Ridge Drive and 835 Edgebrook Drive, Hunter Tri-Frat complex at 930 to 934 Greenbrier Road and Lincoln Tower apartment complex at 1100 W. Lincoln Highway.

If the DeKalb City Council were to approve the purchase, the city would own the rental properties along with the former Campus Cinemas building on Blackhawk Road, opening that corner up for redevelopment, DeKalb Mayor Cohen Barnes said.

“The DeKalb City Council is determined to make a positive difference for the Annie Glidden North neighborhood and to breathe new life into the vital core of that neighborhood, which includes the Hunter Hillcrest properties and the City-owned properties that connect along the Blackhawk Drive corridor between Hillcrest and Ridge Drives,” Barnes said in a statement Wednesday.

In a phone interview Wednesday, Barnes, who’s been in office for three days, said he believes the City Council “united” on their intent to buy Hunter Hillcrest.

“This is a top priority for us,” Barnes said. “To make sure that we address the Hunter Properties situation and to make that investment in the Annie Glidden North neighborhood that we’ve been talking about for so long. Everything I will do as mayor will always be based on what’s in the best interest of all of our citizens in DeKalb.”

Barnes said he was limited on the details he could share because the initiative is still in its infant stages, but said he’s excited as mayor to take the next steps.

Next steps

The announcement is the first step in the process, with the City making known its intent to buy the apartments. The actual purchase will be pending City Council approval along with appraisals, which DeKalb City Manager Bill Nicklas said have not happened yet.

“I strongly support the bold action of our mayor and council to pursue the acquisition of the Hunter Hillcrest properties,” Nicklas said. “When combined with the city’s properties on Blackhawk, the city will be in a position to work with the Opportunity DeKalb board and other stakeholders to solicit creative redevelopment proposals.”

According to a news release, the city notified Hunter Properties of its desire to buy Hunter Hillcrest on Monday and identified its preferred appraiser for the sale. A representative of Hunter Properties responded Wednesday, within the required five-day window, with the name of its own designated appraiser.

Nicklas said the next steps will include each appointed appraiser coming up cooperatively with a third, outside appraiser who will take the next 60 days to go through Hunter Hillcrest and make an estimate on its sale value.

[ Landlord limited: DeKalb City Council approves settlement with controversial Hunter Properties, tenants speak out about ‘unacceptable’ living conditions ]

During a City Council meeting April 26, residents of Hunter Ridgebrook, Hunter Tri-Frat and Lincoln Tower expressed concerns of being displaced and having to find new housing when the time comes.

Nicklas said that the appraiser, if approved by council to move forward with the purchase, also will take a look at current tenant leases as that will factor into the value of the property when it’s placed on the market.

“[The third party appraiser] will have the opportunity to assess all of the building, and that person can identify what exactly the leases are at this point, are there any longer term, any month-to-month and what are they,” Nicklas said. “And then that factors into the appraised value and it also gives us a baseline of information on which to have further discussion.”

Nicklas said the city hasn’t yet had access to a full building inspection obviously, pending yet-to-be approved ownership changes, but he knows the building has tenants currently.

“They’re renting the second floor, I think,” Nicklas said. “Some of those units are on a month-to-month basis, but I can’t say what the level of occupancy is at this point.”

Since the appraisal still needs to happen, Nicklas said the City doesn’t have an exact estimate of how much the property will cost to purchase, but said he believes it will be affordable, though did not give details about whether there are any potential buyers who’ve stepped forward.

“We’re open to interests from other parties, but we wouldn’t have made the offer if we didn’t think at least in the short term we could purchase it,” Nicklas said. “Over time, there are ways we’ll be able to reimburse our General Fund Reserve, which is where it [purchase money] could come from for now. There are some cost shifts that the federal government is now working through to identify how America Recovery Act monies will be spent, and there are going to be ways we can reimburse costs from our COVID impacts.”

Nicklas said the purchase agreement will come to the City Council for a vote at a future meeting.

Community reaction

Dan Kenney, spokesman for the group Opportunity DeKalb, a community-led group which was formed in part out of the city committee known as the Annie Glidden North Taskforce, said he’s not aware of any specific project or plans anyone has in mind for the property.

However, he pointed to the listed ideal uses of this type of land within the revitalization plan for the neighborhood, including a possible community center, quality mixed income housing and better options for food security.

“As an organization, we’re happy to hear that and we’d like to see more responsible ownership,” Kenney said.

[ ‘There’s nowhere in North Annie Glidden to get fresh food;’ Locals discuss grocery store needs on DeKalb’s north side ]

DeKalb First Ward Alderwoman Carolyn Morris said she is not aware of any specific proposed uses for the space following the vity’s purchase intent announcement. She said it could mean some residents and businesses that currently occupy the residential and commercial areas of the building are displaced, though the vity’s intent was to minimize the number of affected people in the area as much as possible.

“We want to be respectful of residents and businesses,” Morris said.

According to state of Illinois law, landlords must give tenants at least 30 day’s notice of their intent to raise the rent.

Kenney said resources such as the Family Service Agency of DeKalb County and the DeKalb County Housing Authority might be good starting points for potentially displaced residents who would need financial assistance to put money down for another rental unit.

Morris said she’s personally encouraged by the vity declaring intent to purchase the property from Hunter Properties. She said part of the revitalization plan included the goal of attracting more responsible landlords to the area.

“I think this is in alignment with the Annie Glidden North revitalization plan,” Morris said.

Note: An earlier version of this story misquoted Dan Kenney, and has since been corrected. The Daily Chronicle regrets the error.