Five Points project developer seeking contract extension
URBANA — The developer of the Gateway Shoppes at Five Points center at University and Cunningham avenues would have an extra three years to finish the project if city council approval holds up on Monday night.
The project deadline expires at the end of December, but the Urbana City Council has already given preliminary support to extend the contract between the city and the developer, who is eligible for property tax rebates. City council members could move that deadline to Dec. 31, 2015, when they meet tonight (Monday, Nov. 19) at 7 p.m. in the Urbana City Building, 400 S. Vine St.
Last week, the city's Economic Development Manager Tom Carrino told council members that the developer, Five Points Realty LLC, has three options that would constitute "completion" of the project. The 8-acre site could contain two shopping malls, one shopping mall and a small hotel, or one large hotel and conference center.
There is already a shopping mall on the site, but Carrino said the developer is still working with prospective tenants and partners to complete the second half of the project.
The city has been paying partial property tax rebates to the developer based on how much additional property tax revenue the city has received as a direct result of the new construction. But under the original agreement from 2005, the city could terminate those payments if the project is not finished by the end of this year.
"In order to remain in compliance with the agreement, in order to maintain his current financing agreement and in order to secure future financing for the completion of the project, the developer approached the city and asked that we adjust the completion date," Carrino said.
If the city council signs off tonight, the deadline to get that second building on the property would be extended three years.
Carrino said the developer is trying to move forward quickly. The longer the second building is delayed, the longer it takes for the city to start paying the property tax reimbursements to the developer. The city would not make any payments beyond 2022, so the window of opportunity will eventually close.
"There's an incentive to build that second building and do it as quickly as possible," Carrino said.