Treehouse Play Cafe set for Route 31 location; city incentives will help pay for build-out

McHenry Mayor Wayne Jett said he and Doug Martin, the city’s economic development director, have been working for four years to bring a Treehouse Play Cafe to the city.

An agreement approved June 17 with the McHenry City Council finalized that deal to bring the indoor play area and restaurant to town. The council approved an updated agreement with Advance Real Estate Management LLC in the amount of $20,000 “to incentivize the Treehouse Play Café to occupy the vacant space at 2328 N. Richmond Road in the McHenry Towne Center Shopping Center,” according to city documents.

With one location now in Lake Zurich, “[our] new location promises the same innovative indoor playground, cozy cafe and dedicated event space ... [as] the original Treehouse Play Cafe,” co-owner Alison Ferguson wrote in an email to the Northwest Herald.

The new agreement, Martin said last week, gives the Treehouse owners $185,000 in incentives to build out the space – a former Pier 1 location – into an indoor playground and restaurant. The site’s total estimated build-out will cost more than $1 million, Martin said.

The incentive is part of an existing agreement with the shopping center’s owners, Martin said.

First approved by the city in 2021, the incentive rebated $1.5 million in sales tax to the shopping center’s owner over 20 years. The incentive is designed to help keep retail stores in the city, Martin said. The $20,000 increase for Treehouse now is added to the total.

Originally, the agreement was set up to fill two vacant spaces at McHenry Towne Center, Martin said. One of the empty spaces, a former Dress Barn, was filled by a Five Below retail store that had been elsewhere in McHenry. About $85,000 from the development agreement was allocated to pay for the build-out.

“Five Below was going to relocate outside of the city. We try to retain viable tenants within the city,” Martin said.

The shopping center, built in about 2001, has eight stores in the main building and 10 outlots. With Treehouse, all of the main shopping center shops will be filled, Martin said, leaving only one outlot – a former bank – empty.

In total, Richmond Road (Route 31) has about 140,000 square feet of available commercial and retail space, Martin said. That includes a former Sears store, the largest single open space in the corridor.

“The old Sears ... that could require incentivization. Nothing has been done with that,” Martin said. “It potentially could be something other than retail.”

As part of McHenry’s master plan development, one of the planning sessions demonstrated an interest in mixed uses – retail and residential – in that section of the city, Martin said.