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TO: Mayor Richard C. Irvin
FROM: David Dibo, Executive Director
DATE: May 9, 2019
SUBJECT:
Approval of an agreement between the City of Aurora and Altiro restaurants in the amount of $100,000 to facilitate the opening of a Latin Fusion restaurant in the now vacant space at the Leland Building on the corner of Galena and Stolp. This funding will be split between a $64,000 grant and $36,000 loan payable within two years.
PURPOSE:
To entice a proven restauranteur to come to downtown Aurora and be open for the next Paramount Fall Season. This would complement the significant activity that is occurring on Stolp Avenue, supporting this area as the “center of gravity” in the downtown.
BACKGROUND:
Altiro was founded by Roberto Altiro, a self-made entrepreneur and former professional soccer player in Mexico. After working at restaurants in Geneva for a number of years, he refined his craft both gastronomically and operationally and opened up five restaurants in Geneva, La Grange, Chicago (Roscoe Village), West Chicago and Wheaton (opening shortly). Roberto and his wife have been lauded in the press including having Altiro being named one of the ten best Fusion restaurants in Illinois.
Altiro typically works with selected investors to create his restaurants, but encountered difficulty securing them in downtown Aurora. To proactively maintain Roberto’s willingness to come downtown, the City and Invest Aurora have been working closely with him over the last 3 months.
DISCUSSION:
The goal is to have the restaurant open by early Fall. In order to do so, Altiro needs funding for furniture and equipment.
The City would provide the funding of $100,000 in two payments. The first would be no later than May 31, 2019. The funding is available in the Downtown TIF Fund in account
231-1830-465-55-63, Major Project Development, with a budget of $150,000.
Mr. Karademas, will allow rent payments of $4,000 per month for a period of nine months beginning in month 10 and continuing up to and including month 18 to go to paying off the City’s $36,000 loan. At that point, the City’s contribution will be reduced to $64,000 or the amount of the grant. The final capitalization will look like this:
1.) City $64,000 - 2.) Altiro $50,000 - 3.) Karademas $36,000 = TOTAL $150,000
The City funding of this agreement will be secured by a senior lien on all equipment purchased for the buildout of the new space.
In order to further facilitate the transaction, Mr. Karademas has also agreed to grant Altiro the first nine months of free rent or an additional $36,000 for a total $72,000 commitment.
Altiro has agreed to sign a five year lease. Included in the lease will be provisions that reference this agreement, and assure opening in the early Fall.
IMPACT STATEMENT:
This project aligns with the recommendation set forth in the Downtown Master Plan (O17-080), which calls for the redevelopment of existing properties. It will also increase the City’s sales and food and beverage taxes by an estimated $35,000 per year. This will enable a payback of the City’s grant in approximately two years. In addition, the restaurant, serving three meals a day will support new residents moving downtown, increase foot traffic, and provide easy meal service to attendees at the Paramount.
The Leland retail space has had a checkered history and in supporting this deal the City, for a reasonable investment will bring the first chain restaurant to the downtown in many years.
RECOMMENDATIONS:
Staff recommends approval.
cc: Robert J. O'Connor, Chairman
Alderman Edward J. Bugg, Member
Alderman Theodoros 'Ted" Mesiacos, Member
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Requesting approval of an agreement between the City of Aurora and Altiro restaurants in the amount of $100,000 to facilitate the opening of a Latin Fusion restaurant in the now vacant space at the Leland Building on the corner of Galena and Stolp. This funding will be split between a $64,000 grant and $36,000 loan payable within two years.
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, The City of Aurora desires to increase the number of quality restaurant establishments in the Downtown, and
WHEREAS, The City has negotiated an agreement with Altiro restaurants In the Leland building at Stolp and Galena Blvd;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows:
That the City Council hereby authorizes a development agreement with Altiro restaurants in an amount not to exceed $100,000 which will be comprised of a $64,000 grant and a $36,000 loan to be repaid within two years of the opening of the restaurant. This agreement will also be secured by a senior lien on all new equipment purchased for the restaurant.