Pacific Retail Capital Partners is closer to turning around a beleaguered suburban Chicago mall, helping to drive a trend among owners in the indoor retail market.
Lombard trustees unanimously approved zoning changes for a $200 million residential project at the Yorktown Center mall that will replace an old Carson’s department store, which has sat vacant since 2018, the Daily Herald reported.
The Carson’s teardown would also make way for a new mall entrance and Main Street-style plaza as part of a larger redevelopment plan. Village officials are working on the final touches of an economic incentive agreement that would provide tax increment financing and sales tax dollars to the developers to help fund the project.
A handful of other Chicagoland mall landlords have started down the residential route to revive their holdings. With the pandemic further boosting online shopping tendencies that were already growing, even more pressure has fallen on traditional shopping centers, some of which have long been deserted or sitting at a fraction of their former occupancy rates in recent years.
French Developer URW is undertaking a $100 million renovation of Skokie’s Westfield Old Orchard shopping mall to add 350 apartments. And in another northern suburb, Brookfield Properties is in talks with local officials to build 2,000 homes, comprising a blend of apartments, condos and townhomes, at the Northbrook Court mall.
Los Angeles-based Pacific Retail, which owns the core of the Yorktown Center mall, is teaming up with Chicago-based Synergy Construction Group for the Lombard project in the western suburbs.
The new plan for Yorktown Center calls for a five-story multifamily complex, called Yorktown Reserve, on a mall parking lot east of Highland Avenue. At full build, the project will include two residential buildings, totaling 621 units.
Work on the first apartment could start by 2024 as part of the initial phase of development. Timing of the second phase’s kickoff “would be a function of the market condition later in the process,” Lombard community development director William Heniff said.
In addition, Pacific Retail wants to make the mall facade more outward-facing and accessible for future customers, including glass storefronts for tenants around the plaza.
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Village officials have discussed “performance-based” incentives for the project. This could amount to $12.1 million in tax increment financing for the phase one apartment building, $9.6 million for the building in the second phase, and a multimillion-dollar business improvement district incentive for the plaza and exterior upgrades.
— Quinn Donoghue