Construction on nearly 250 residential units next to Mundelein’s village hall is expected to begin in the coming weeks, marking what Mayor Steve Lentz called a “capstone” for the village’s vision of Plaza Circle.
The redevelopment, known as Area, encompasses several lots between village hall and the train station. It includes a 225-unit apartment complex and 17 townhomes, and retail space to the north, along Hawley Street. Lentz said it will finally fill out the plaza, which was designed over a decade ago.
During Monday’s Village Board meeting, the board approved an amendment to the redevelopment to address a 45% increase in the project’s budget, rising from $61 million to $89 million.
Trustee Jenny Ross attributed the increases to inflation. Village documents indicate three main areas of cost increases; hard costs, such as for materials and landscaping, soft costs, such as fees and insurance rates, and financing costs, with interest rates higher than in 2022, when the project was initially proposed.
“Inflation is real, and it really did inflate the costs of this project from when they did the first estimate,” she said.
The amendment includes some unique assistance from the village to aid the development. According to Matt Norton, special counsel for the village for real estate development, rather than a traditional real estate closing where the developer pays the village for the land, the village will essentially invest the land into the project. Impact fees normally paid to the village will also be waived.
The total value of the land and waived impact fees is about $2.1 million, Norton said, and in return, the village will become a member of an LLC that owns and develops the project. Mundelein will be the first LLC member paid back, with 100% of its investment as well as a 3% “success fee” according to village documents, no later than March 31, 2030
Ross said she was glad to see the developer was willing to move ahead despite rising costs. Along with other residential developments in the area, such as the nearby 166-unit apartment complex Station 250, the project was a sign of a “transformative among of growth” in Mundelein.
Groundbreaking on the redevelopment is expected to begin in the coming weeks, Ross said.