Tenant relocation underway for Hunter Hillcrest purchase, says DeKalb city manager

The following is an update of several ongoing development projects in DeKalb and Sycamore.

Hunter Hillcrest

Ownership transfer of Hunter Hillcrest, 1011 through 1027 Hillcrest Drive, after the city of DeKalb approved the $1.18 million purchase in August, is set to close in a week, DeKalb City Manager Bill Nicklas said.

“Unless there’s some unforeseen delay, the closing with the city and Hunter will be Oct. 18,” Nicklas said. “We have been working with tenants in anticipation of that. Upon the closing, we will provide all the tenants both commercial and residential with a letter from the city explaining that they have six months to find other arrangements.”

The ctiy has plans to demolish the building once its occupants have relocated. Demolition won’t begin until all tenants are out, Nicklas said. That includes the 6-month grace period for relocation.

Nicklas said relocation efforts already are underway. One commercial tenant, American Dream Tax, which also has a UHaul branch in the space, already has taken the city up on relocation aid.

“We’ve successfully worked with the owner and coordinated our contribution to his relocation,” Nicklas said. He said costs for relocation “haven’t been extraordinary,” so far, and usually includes the city paying for first and last months’ rent in a new space and moving expenses.

Nicklas has said there are 14 residential units in the upstairs part of the building, alhough the upstairs isn’t fully occupied, while each of the nine commercial spaces on the main level are occupied by businesses.

Nicklas said the city recently pocketed $1.5 million in federal American Recovery Act funds to use for residents “who have been underserved for a period of time.” He said some of that money will go toward helping residents and businesses relocate, since that’s a demolition-related cost and falls within fund-use parameters.

The City has for months worked to purchase the residential and commercial space from owner Hunter Properties amid a years-long tumultuous relationship with the area’s largest landlord.

The mixed-use rental retail building at 1011 through 1027 Hillcrest Drive is one of four rental properties owned by Evanston-based Hunter Properties that the landlord must sell as part of a recently approved settlement agreement between the landlord and the city. Hunter Properties is required to sell the buildings by April 2023 after years of involving concerns expressed by city staff, officials and tenants over poor quality of living in the spaces.

Per the settlement agreement with local landlord Hunter Properties the DeKalb City Council approved in April, the buildings that Hunter Properties will be required to sell include Hunter Ridgebrook, Hunter Tri-Frat, Lincoln Tower and Hunter Hillcrest, according to the agreement.

Campus Cinemas

Next door to Hunter Hillcrest, the vacant lot at 1015 Blackhawk Road, which once held the old Campus Cinemas building, awaits future development, Nicklas said.

The city owns the long-vacant movie theater lot after being granted a lien in the amount of $400,000 on the property last year. It was demolished in October 2020, and city staff have said they plan to put the parcel up for development opportunities. The movie theater was previously owned by Pete Occhipinti, who had over the years petitioned multiple times for a special-use permit to revamp the single-story 15,200-square-foot building. The city denied his request.

“We’re going to be tearing up the asphalt,” Nicklas said. “Local excavators are busy right now, but we have arranged to have that work started this fall within the fenced area. It’s going to be more expensive to do it in the spring, so we’re going to do it now. Show people we’re serous about it.”

Former DeKalb Municipal Building

The former home of the DeKalb Police Department and city hall now officially is demolished, and what remains of the DeKalb Municipal Building, 200 S. Fourth St., is a pile of rubble.

“It’s all down,” Nicklas said. “There’s a lot of masonry, so they’re crushing that on-site so that the masonry can be grounded into a finer aggregate size and then it can be recycled for a variety of purposes.”

Construction is expected to last through 2022, with an anticipated opening at the end of next year.

The building was purchased by DeKalb-based Pappas Development about a year ago for $600,000. Pappas has plans to turned it into a $7.5 million apartment building development called Johann Executive Suites, bolstered with $750,000 in tax increment finance incentives from the city.

The building was demolished last month.

Construction work on another Pappas development down the street, dubbed Agora Tower, also is ongoing.

The space will be similar to other Pappas projects, with mixed-use space for both residential and commercial tenants. The $13.8 million project, which received $3 million in TIF money from the city, will sit on three acres, with 113,000-square-foot of space.

The property, at North Fourth and Locusts streets, was home to the last barbed wire factory in DeKalb and also was once the Mooney car dealership.

Facebook’s DeKalb Data Center

Construction on the south side’s newest social media resident, Facebook, and the 907,000-square-foot, 500-acre data center being built along Gurler Road is “really starting to take shape,” Nicklas said.

“It’s just such an enormous undertaking,” Nicklas said. “Things have been moving along. The summer weather was very kind to construction. The general contractors, Mortenson, seems to be happy with the pace.”

Nicklas said plans for a late 2022 grand opening remain in place.

The $800 million investment by Facebook was announced in June 2020 and is the 12th of its kind to be built in the U.S.

At the project’s peak, Facebook officials estimate the site construction will employ 1,200 construction and trade workers, which will span the two to three years it will take to get the first building up and running. For data center jobs – which could start at $38.50 per hour, according to city documents – Facebook plans to hire technicians, engineers, construction management, facility managers, logistics professors and security personnel.

The Facebook data center will be privy to a 20-year, 55% property tax abatement plan, already approved by the council and agreed upon through the DeKalb County Enterprise Zone, a program administered by the DeKalb County Economic Development Corporation, with a stipulation of 50 tech jobs with a starting wage of $38.50 an hour to qualify for tax abatements within the first few years, documents show.

Over the next 20 years, city officials have said the data center is projected to yield tax revenue for the participating taxing bodies, even with the tax abatements, that is comparable to the five largest existing industrial companies in DeKalb (Target distribution, 3M, Panduit, Nestle, Goodyear) combined, documents show.

In Sycamore, commercial space near Meijer remains unclaimed

Despite rampant rumors to the contrary, commercial space being built along Sycamore Road next to the Meijer remains unclaimed, said John Sauter, director of building and engineering for the city of Sycamore.

The building construction, near Puri Parkway and Meijer, is underway, and no retail or business has been announced yet.

“It will be a multi-tenant building,” Sauter said. “No plans have been submitted for the tenant spaces to date.”

Daily Chronicle reporter Katie Finlon contributed to this report.