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TO: Mayor Richard C. Irvin
FROM: David Dibo, Director of Economic Development
DATE: November 17, 2020
SUBJECT:
A Resolution authorizing the execution of an exclusive listing agreement with JBSC, INC. D/B/A Caton Commercial Real Estate Group.
PURPOSE:
The purpose of this request is to formally engage a full service regional commercial real estate firm known blending a community focus with a wide range of professional contacts and experience
The impetus for hiring Caton is 1) To build on the momentum of recent downtown development by attracting new users/tenants into the core of the City that provide services and create interest for existing and new residential and office users and other visitors seeking to experience the downtown and its many offerings. 2) To fill vacant storefronts that are visually unattractive and create the impression of a less than vibrant local economy 3) To create synergies with other merchants so that patrons can look to the downtown for a “full service experience” 4) To generate revenues for the city though lease income and sale proceeds and resultant sales, food and beverage and property taxes and 5) To make a positive contribution to the local market economy that will enable rents and values to more closely reflect other healthy commercial markets. This will benefit property owners, tenants, and patrons by facilitating the economics of reinvesting in existing properties independent from any incentive that may or may not be available from City of Aurora.
BACKGROUND:
Invest Aurora began discussions with Caton about a year ago. Caton is community based, highly experienced, multifaceted real estate firm headquartered in Naperville. The company is very active in Aurora and is best known here for procuring Amy Morton’s Stolp Island Social at the Paramount Art Center in a previous assignment. COA/IA has made it a priority to create productive uses in buildings owned by the city in the downtown while respecting assemblages that have taken many years to put together. COA/IA first wanted to create momentum in the downtown before taking this step to give this process as strong headwind. The goal is not just to fill up spaces but also to seek out tenants/users that will enhance the downtown experience. COA is committed to altering high turnover rates that has plagued certain downtown retail locations.
DISCUSSION:
While Covid-19 has and will continue to create challenges, COA/IA believe this is an ideal time to initiate this process. While the holiday season is traditionally a slow time for new business, getting the agreement approved now will give Caton an opportunity to prepare marketing plans and packages and organize their prospect lists to be ready for a mid-January start date. The agreement is for one year. The commission rate and other terms were negotiated to incent Caton and two successful professionals to spend the time necessary to make this initiative successful.
The four properties covered in this listing agreement are:
|
Property |
Description |
Rationale |
Comments |
|
#1. 35 New York St. |
- Located in the heart of Downtown - 2,700 sq. ft - Dark shell - Two stories with full basement - Masonry Construction |
- Rental Rate: mid teens psf + triple net lease (NNNs) - Sale Price: Priced for Redevelopment |
Recommended Uses: - Tasting Room, Wine/Whiskey bar - Pop-up shop - Independent food shops - Ice Cream / Confectionery |
|
#2. 5 E. Downer Pl. |
- 10,700 sq. ft - Located on the ground level of Stolp Island parking garage - Heavy foot and vehicular traffic - Office space - The adjacent parking garage features 850 parking stalls |
- Rental Rate: mid teens psf + triple net lease (NNNs) - Tenant improvement package to be determined based on tenant use |
Recommended Uses: - Wine & Cheese Shop - Chiropractor - Physical Therapy - Boutique Fitness/ Yoga / Pilates Studio - Deli / Grab and Go Food - Pottery, Paint, Home Goods |
|
#3. 33 S Broadway |
- 3,200 sq. ft - Located in the heart of Downtown - High visibility and traffic |
- Rental Rate: low teens psf + triple net lease (NNNs) - Tenant improvement package to be determined based on tenant use |
Recommended Uses: - Pet Grooming / Pet Supplies - Yoga / Pilates Studio - Deli / Grab and Go food - Bakery - Wine / Whiskey Bar / Tasting Room / Full Service Salon - Specialty Food Use |
|
#4. 51 E Galena Blvd. |
- 5,904 sq. ft - Located in the heart of the Downtown Art District - High visibility and traffic |
- Rental Rate: low to mid teens psf + triple net lease (NNNs) - Tenant improvement package to be determined based on tenant use |
Recommended Uses: - Boutique Gym - Physical Therapy - Bookstore - Gift Shop - Breakfast Restaurant - Street Corner Urban Market - Pottery Making - Soft Good Retailer |
IMPACT STATEMENT:
Having a full time, experienced real estate company actively marketing these properties should lead to more leasing activity in the downtown which in turn will have a positive synergistic effect on other properties owned. Real estate taxes, currently now not being assessed as a result of city ownership, will allow properties to return to the tax roles as a result of an immediate sale(s) or those that occur after users are put in place, Sales taxes and food and beverage taxes will also be generated; having vacant storefronts occupied will have a positive impact on other owners, tenants and residents.
RECOMMENDATIONS:
Staff recommends that this resolution be approved.
cc: Finance Committee
Alderman Robert O’Connor, Chairperson
Alderman Edward J. Bugg, Vice Chairperson
Alderman Carl Franco
Alderwoman Scheketa Hart-Burns
Alderman Emmanuel Llamas
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Authorizing the Execution of an Exclusive Listing Agreement with JBSC, INC. D/B/A Caton Commercial Real Estate Group.
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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 owns a certain four (4) properties (33 S, Broadway Street, Aurora, Illinois; 5 E Downer Unit A and E, Aurora, Illinois; 35 W New York Avenue, Aurora, Illinois; and 51 E Galena Blvd, Aurora, Illinois) (the “Properties”); and
WHEREAS, the City desires to sell or lease the Properties to continue to foster the renaissance of the City’s downtown area; and
WHEREAS, after due and careful consideration, the City has determined that it is in the best interests of the City to negotiate an exclusive listing agreement with JBSC, Inc. d/b/a Caton Commercial Real Estate Group (“Caton”) in which Caton will list and market the Properties for sale or lease;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: that the exclusive listing agreement attached to this resolution as Exhibit A shall be and hereby is approved; and further
BE IT RESOLVED, that the Mayor is authorized to execute an exclusive listing agreement that substantially and materially conforms to the provisions of the exclusive listing agreement set forth in Exhibit A on behalf of the City; and further
BE IT RESOLVED, that the Mayor, Finance Director, Director of Economic Development, and each of their respective designees shall be and hereby are authorized to perform the City’s duties set forth therein described.