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R-1341 - 03/11/2014 - ECONOMIC DEVELOPMENT - Resolutions Supporting Documents ITEM I0.C,2) %- 0F Oqk ■,'.41i.0 V44%104:PC) 4 Vol ZIT It,V'V/....? AGENDA ITEM Regular Board of Trustees Meeting of March 11, 2014 SUBJECT: Duchossois Real Estate Development Agreement FROM: David Niemeyer, Village Manager BUDGET SOURCE/BUDGET IMPACT: N/A RECOMMENDATION: Motion To Approve Resolution 2014-ECODV-AG-R-1341 Approving And Authorizing The Execution Of An Economic Incentive Agreement By And Between The Village Of Oak Brook And Duchossois Real Estate, LLC. Background/History: Duchussois Real Estate recently approached the Village about their plans for constructing a new 252,600 sq. ft. corporate headquarters facility on the Follett building site which is located at 1818 Swift Drive. The tenant would be the Chamberlain Group, currently located in Elmhurst. The Chamberlain Group specializes in garage door openers and related parts. In addition, Duchossois is looking to buy several surrounding properties and eventually construct a second phase which may include an additional building(s). Chamberlain would initially be bringing about 750 employees to Oak Brook in its first phase. If the additional properties are purchased by Chamberlain, the parcels would be consolidated into a single lot which would require the review and approval of a subdivision plat by the Village of Oak Brook. Chamberlain's relocation to Oak Brook will be a significant positive economic impact to our community. It will be easier for their employees to shop and dine in Oak Brook. Oak Brook hotels will benefit from events and overnight stays that will be generated from their presence in Oak Brook. Oak Brook will also be exposed to other corporate professionals who will visit Chamberlain. Chamberlain is moving forward with its plans to move to Oak Brook but has requested a number of incentives from the Village. In recognition of the significant benefits that Chamberlain would Last saved by dbettin J:\Agenda Items\Duchusois Devlpmt Agmt-3-11-14.doc provide the Village, staff recommends the following incentives as outlined in the attached development agreement: • A 50% reduction in permit fees for their first phase only. The normal permit fees would be around $200,000 so the value of the incentive is approximately $100,000. • Reimbursement of up to 50% of the public infrastructure costs up to a maximum of $35,000(or a maximum $70,000 infrastructure reimbursement). Mike Hullihan indicates that there is a possibility that they may have to do some water main relocation based on their building location in the amount of$25-50,000. Other than this, we are not expecting any significant public improvement costs. • The Village will work with Chamberlain and the owners of Windsor Park to replace and modernize the monument entrance sign to the park similar to what the Village is looking at for various businesses on Jorie Road and Kensington Drive. • As part of this agreement, Chamberlain will agree to occupy their headquarters building for at least 5 years and reimburse the Village for legal expenses in preparing this agreement. In addition, the financial incentives will only be good for 5 years from the date the agreement is approved by the Board. Recommendation: Motion to approve Resolution R-1341 Approving and Authorizing The Execution Of An Economic Incentive Agreement Between The Village Of Oak Brook And Duchossois Real Estate, LLC. Last saved by dbettin J:\Agenda Items\Duchusois Devlpmt Agmt-3-11-14.doc ECONOMIC INCENTIVE AGREEMENT BY AND BETWEEN THE VILLAGE OF OAK BROOK AND DUCHOSSOIS REAL ESTATE, LLC THIS AGREEMENT is made as of the day of _, 2014, and is by and between the VILLAGE OF OAK BROOK, an Illinois municipal corporation ("Village"), and DUCHOSSOIS REAL ESTATE, LLC, a Delaware limited liability company ("Developer"). IN CONSIDERATION OF the recitals and the mutual covenants and agreeinents set forth in this Agreement, the parties hereto agree as follows: SECTION 1. RECITALS. A. The Developer is, as of the Effective Date as defined in Section 9 below, legal title owner of that certain tract of land commonly known as 1818 Swift Drive, Oak Brook, Illinois, and legally described in Exhibit A attached to this Agreement ("Property"). B. The Developer desires to demolish the existing building on the Property and to construct and develop a new commercial building on the Property to be used as the new corporate headquarters for Chamberlain Group, Inc. ("Building") along with all related and necessary public and private on-site and off-site improvements to be made in connection with the development of the Building on the Property ("Improvements") (collectively, "Phase 1 Development"). C. Pursuant to Resolution 2014-ECODV-AG-R1341, the corporate authorities of the Village have determined that it is desirable to promote economic development within the Village by providing certain incentives to the Developer for the completion of the Phase 1 Development as provided in Section 3 of this Agreement and as authorized by 65 ILCS 5/8-1-2.5. D. The Village and the Developer now seek to enter into this Agreement pursuant to the authority granted by, among others, the following: (i) Division 13 of Article 11 of the Illinois Municipal Code (65 ILCS 5/11-13-1 et seq.); (ii) Division 1-2.5 of Article 8 of the Illinois Municipal Code (65 ILCS 5/8-1-2.5); and (iii) the Village's police powers.. SECTION 2. DEVELOPMENT OF THE PROPERTY. The Developer acknowledges and agrees that the Phase 1 Development of the Property, and construction and installation of all Improvements, shall be completed pursuant to the Village Code of the Village of Oak Brook, Illinois ("Village Code"), and to all other applicable federal, state, and Village laws, statutes, codes, ordinances, resolutions, rules and regulations (collectively, "Requirements of Law"). SECTION 3. ECONOMIC INCENTIVES. A. Village Economic Incentives to Developer. Pursuant to Section 8-1-2.5 of the Illinois Municipal Code, 65 ILCS 5/8-1-2.5, and subject to the conditions in Subsection 3.B of this Agreement, the Corporate Authorities have authorized the following incentives to the Developer for the completion of the Phase 1 Development ("Economic Incentives"): Building Permit Fees. The Village shall provide the Developer a 50 percent reduction in the otherwise applicable building permit fees required for the initial demolition, construction and build-out of the Building on the Property, including but limited to those fees set forth in Sections 10-4-1 et seq., 8-5-2.A— F, 9-5-5, and 9-7-8 of the Village Code. ii. Village Contribution. The Village shall provide the Developer a contribution in an amount equal to 50 percent of the actual costs incurred by the Developer for the design and construction of the public improvements (which shall be defined as improvements that are dedicated to and accepted by the Village) for or reasonably related to the Property ("Total Costs"); provided, however, that such contribution shall not exceed $35,000. Following completion of the public improvements, the Developer shall provide the Village with detailed cost and invoice information establishing to the Village's satisfaction the Total Costs incurred by the Developer for the construction of the public improvements for the Property. Upon the Village's determination that the Developer has incurred costs related to the design and construction of public improvements, the Village shall promptly reimburse the Developer for 50 percent of the costs up to a maximum reimbursement amount of$35,000. B. Occupancy Requirement. The incentives provided by the Village pursuant to Subsection 3.A of this Agreement are contingent upon, and subject to, the Chamberlain Group continuously occupying the Building for its corporate headquarters for a period of not less than five years beginning with the date on which the Village issues a certificate of occupancy to the Developer for the Building ("Occupancy Requirement"). In the event the Occupancy Requirement is not satisfied, the Developer shall be required to refund to the Village the entire amount of the Economic Incentives provided by the Village to the Developer pursuant to this Agreement. SECTION 4. COOPERATION OF THE VILLAGE IN PHASE 1 DEVELOPMENT PROCESS A. Monument Sign. The Developer and Village acknowledge and agree that it is desirable that the monument sign located at the northwest corner of Windsor Drive and 22nd Street in the Village ("Monument Sign") be replaced and modernized ("Sign Improvements"). The Village agrees to cooperate with the Developer with regard to the Developer's efforts to undertake or otherwise provide or arrange for (either by the Developer or by other parties) for the Sign Improvements, including the consideration of any required permits or other approvals for the Sign Improvements. Any specific request for Village participation in the cost of the Sign Improvements will be subject to a separate approval by the Village Board in its discretion. B. Street Lighting. The Village acknowledges that the Developer may seek a waiver from the provisions of the Village Code with regard to the otherwise applicable requirements for installation of street lights on Windsor Drive. In the event that the Developer seeks such a waiver, the Village agrees to consider the request for the waiver as part of the subdivision approval process. SECTION 5. FUTURE PHASES OF DEVELOPMENT. The parties acknowledge and agree that: (i) this Agreement shall only apply to the Phase 1 Development; and (ii) the Village is not obligated to provide any economic incentives or other benefits to the Developer, or to waive any Requirements of Law, for any future resubdivision of any property owned, or may be owned in the future, by the Developer other than as specifically provided in this Agreement. SECTION 6. VILLAGE COSTS AND FEES. The Developer shall pay all legal, engineering, and other consulting or administrative fees, costs, and expenses incurred or accrued in connection with the Phase 1 Development and the preparation of this Agreement, provided that the amount of legal fees incurred or accrued that the Developer shall be responsible to pay pursuant to this Section 6 shall not exceed $5,000. 2 SECTION 7. LIABILITY AND INDEMNITY OF VILLAGE. A. Village Procedures. The Developer acknowledges and agrees that all notices, meetings, and hearings have been properly given and held by the Village with respect to the approval of this Agreement and agrees not to challenge such approval on the grounds of any procedural infirmity or of any denial of any procedural right. B. Indemnity. The Developer agrees to, and does hereby, hold harmless and indemnify the Village, its Corporate Authorities, and all Village elected or appointed officials, officers, employees, agents, representatives, engineers, and attorneys, from any and all claims that may be asserted at any time against any of such parties in connection with (i) the Village's review and approval of any plans for the Property or the Improvements; (ii) the issuance of any approval, permit, certificate or acceptance for the Property or the Improvements; and (iii) the development, construction, maintenance or use of any portion of the Property or the Improvements. C. Expense. The Developer shall, and does hereby agree to, pay all expenses, including legal fees and administrative expenses, incurred by the Village in defending itself with regard to any and all of the claims for which they are responsible as referenced in Subsection 7.B of this Agreement. SECTION 8. NATURE, SURVIVAL AND TRANSFER OF OBLIGATIONS. All obligations assumed by the Developer under this Agreement shall be binding upon the Developer, upon any and all of the Developer's heirs, successors and assigns, and upon any and all of the respective successor legal or beneficial owners of all or any portion of the Property. SECTION 9. TERM. This Agreement shall be effective as of the date the Developer obtains title to the Property ("Effective Date") and shall terminate on the date that the Developer completes the Occupancy Requirement, provided, however, that if the Developer fails to satisfy the Occupancy Requirement, this Agreement shall terminate on the date that the Developer refunds to the Village the entire amount of the Economic Incentive paid by the Village to the Developer as required pursuant to Section 3.B of this Agreement. The provisions of this Agreement shall run with and bind the Property, and shall inure to the benefit of, and be enforceable by, the Developer and the Village, and any of their respective legal representatives, heirs, grantees, successors, and assigns. Upon termination of this Agreement, the parties shall execute the appropriate and recordable evidence of the termination of this Agreement ("Certificate of Completion"); provided that the Developer's indemnity and defense obligations as set forth in Section 7 of this Agreement shall survive any termination of this Agreement. The Developer shall be entitled to record the Certificate of Completion at its expense. SECTION 10. ENFORCEMENT. The parties to this Agreement may, in law or in equity, by suit, action, mandamus or any other proceeding, including without limitation, specific performance, enforce or compel the performance of this Agreement: provided, however, that the Developer agrees that it will not seek, and does not have the right to seek, to recover a judgment for monetary damages against the Village or any elected or appointed officials, officers, employees, agents, representatives, engineers, or attorneys thereof, on account of the negotiation, execution, or breach of any of the terms and conditions of this Agreement. In addition to every other remedy permitted by law for the enforcement of the terms of this Agreement, the Village shall be entitled to withhold the issuance of building permits or certificates of occupancy for any and all buildings and structures within the Property at any time when the Developer has failed or refused to meet fully any of its obligations under this Agreement. In the event of a judicial 3 proceeding brought by one party to this Agreement against another party to this Agreement, the prevailing party in such judicial proceeding shall be entitled to reimbursement from the unsuccessful party of all costs and expenses, including reasonable attorneys' fees, incurred in connection with such judicial proceeding. SECTION 11. GENERAL PROVISIONS. A. Notice. Any notice or communication required or permitted to be given under this Agreement shall be in writing and shall be delivered: (i) personally, (ii) by a reputable overnight courier, (iii) by certified mail, return receipt requested, and deposited in the U.S. Mail, postage prepaid, or (iv) by facsimile. Notices and communications to Village shall be addressed to, and delivered at, the following address: Village of Oak Brook 1200 Oak Brook Road Oak Brook, Illinois 60523 Attention: Village Manager With a copy to: Village Attorney Holland & Knight LLP 131 South Dearborn Street 30th Floor Chicago, Illinois 60603 Attention: Peter M. Friedman Notices and communications to the Developer shall be addressed to, and delivered at, the following addresses: B. Time of the Essence. Time is of the essence in the performance of all terms and provisions of this Agreement. C. Entire Agreement. This Agreement constitutes the entire agreement between the parties and supersedes any and all prior agreements and negotiations between the parties, whether written or oral, relating to the subject matter of this Agreement. D. Exhibit. Exhibit A attached to this Agreement is, by this reference, incorporated in and made a part of this Agreement. In the event of a conflict between an exhibit and the text of this Agreement, the text of this Agreement shall control. E. Amendments and Modifications. No amendment or modification to this Agreement shall be effective unless and until it is reduced to writing and approved and executed by all parties to this Agreement in accordance with all applicable statutory procedures. 4 F. Governing Law. This Agreement shall be governed by, and enforced in accordance with, the internal laws, but not the conflicts of laws rules, of the State of Illinois. G. Changes in Laws. Unless otherwise explicitly provided in this Agreement, any reference to any Requirements of Law shall be deemed to include any modifications of, or amendments to such Requirements of Law as may, from time to time, hereinafter occur. H. Non-Waiver. The Village shall be under no obligation to exercise any of the rights granted to it in this Agreement. The failure of the Village to exercise at any time any right granted to the Village shall not be deemed or construed to be a waiver of that right, nor shall the failure void or affect the Village's right to enforce that right or any other right. I. Authority to Execute. The Village hereby warrants and represents to the Developer that the persons executing this Agreement on its behalf have been properly authorized to do so by its Corporate Authorities. The Developer hereby warrants and represents to the Village (i) that the Developer is the owner of fee simple title to the Property, and that the various portions of the Property are contiguous to each other and have no gaps; (ii) that the Developer has the full and complete right, power, and authority to enter into this Agreement and to agree to the terms, provisions, and conditions set forth in and to bind the Property as set forth in this Agreement; (iii) that all legal actions needed to authorize the execution, delivery, and performance of this Agreement have been taken; and (iv) that neither the execution of this Agreement nor the performance of the obligations assumed by the Developer will (a) result in a breach or default under any agreement to which the Developer is a party or to which it or the Property are bound or (b) violate any statute, law, restriction, court order, or agreement to which the Developer or the Property are subject. J. Non-Severability. If any provision, covenant, agreement, or portion of this Agreement or its application to any person, entity, or property be held invalid by a court of competent jurisdiction, the remaining provisions of this Agreement and the validity, enforceability, and application to any person, entity, or property shall be null and void and of no further force and effect, it being the intent of the parties that all of the provisions of this Agreement be treated as an individual whole. K. Calendar Days and Time. Any reference herein to "day" or "days" shall mean calendar and not business days. If the date for giving of any notice required to be given hereunder or the performance of any obligation hereunder falls on a Saturday, Sunday, or Federal holiday, then said notice or obligation may be given or performed on the next business day after such Saturday, Sunday or Federal holiday. L. No Third Party Beneficiaries. No claim as a third party beneficiary under this Agreement by any person, firm, or corporation shall be made, or be valid, against the Village or the Developer. [Signature Page Follows] 5 IN WITNESS WHEREOF, the parties hereto have affixed their signatures the date and year first above written. ATTEST: VILLAGE OF OAK BROOK By: Village Clerk Village President ATTEST: DUCHOSSOIS REAL ESTATE, LLC By: ACKNOWLEDGMENTS STATE OF ILLINOIS ) SS. COUNTY OF DUPAGE ) This instrument was acknowledged before me on , 2014, by , the Village President of the VILLAGE OF OAK BROOK, an Illinois municipal corporation, and by , the Village Clerk of said municipal corporation. Signature of Notary My Commission expires: SEAL STATE OF ILLINOIS ) SS. COUNTY OF DUPAGE ) This instrument was acknowledged before me on , 2014, by of DUCHOSSOIS REAL ESTATE, LLC, and Secretary of said corporation. Signature of Notary My Commission expires: SEAL EXHIBIT A LEGAL DESCRIPTION OF PROPERTY Exhibit A #28329116_v2 RESOLUTION 2014-ECODV-AG-R1341 A RESOLUTION APPROVING AND AUTHORIZING THE EXECUTION OF AN ECONOMIC INCENTIVE AGREEMENT BY AND BETWEEN THE VILLAGE OF OAK BROOK AND DUCHOSSOIS REAL ESTATE, LLC WHEREAS, the Village and Duchossois Real Estate, LLC ("Duchossois") desire to execute an agreement for the provision of certain economic incentives to Duchossois relating to the first phase of development of the property at 1818 Swift Drive in the Village for a new corporate headquarters for the Chamberlain Group ("Agreement"); and WHEREAS, the President and Board of Trustees have determined that it is in the best interests of the Village to enter into the Agreement in a final form approved by the Village Manager and the Village Attorney; NOW THEREFORE, BE IT RESOLVED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF OAK BROOK, DU PAGE AND COOK COUNTIES, ILLINOIS as follows: Section 1: Recitals. The foregoing recitals are hereby incorporated into, and made a part of, this Resolution as the findings of the President and Board of Trustees of the Village of Oak Brook. Section 2: Approval of the Agreement. The President and Board of Trustees hereby approve the Agreement by and between the Village and Duchossois in a form acceptable to the Village Manager and the Village Attorney. Section 3: Authorization and Execution of the Agreement. The Village President and Village Clerk shall be, and hereby are, authorized to execute the final Agreement on behalf of the Village after review and approval of the final form of the Agreement by the Village Manager and the Village Attorney and after receipt of the final Agreement fully executed by Duchossois. Section 4: Effective Date. This Resolution shall be in full force and effect upon passage and approval in the manner provided by law. [SIGNATURE PAGE FOLLOWS] Resolution 2014-ECODV-AG-R1341 Approving and Authorizing the Execution of a Economic Incentive Agreement Page 2 of 2 APPROVED THIS 11th day of March, 2014 Gopal G. Lalmalani Village President PASSED THIS 11th day of March, 2014 Ayes: Nays: Absent: ATTEST: Charlotte K. Pruss Village Clerk tl I FRED BUCHOLZ DUPAGE COUNTY RECORDER JUL.18,2014 11:05 AM OTHER 06-24-402-022 010 PAGES R2014-062782 (Above Space For Recorder's Office Only) VILLAGE OF OAK BROOK 1200 Oak Brook Road Oak Brook, Illinois 60523-2255 RECORDED DOCUMENT TITLE PAGE Title of Document ECONOMIC INCENTIVE AGREEMENT BY AND BETWEEN THE VILLAGE OF OAK BROOK AND DUCHOSSOIS REAL ESTATE, LLC (RESOLUTION 2014-ECODV-AG-R-1341) Property Address/es 1818 SWIFT DRIVE, OAK BROOK, IL 60523 (If vacant land, state vacant land and list nearest cross streets, Oak Brook, IL 60523.) Pin Number/s 06-24-402-0000 Name & Address of Applicant: Name & Address of Responsible DUCHOSSOIS REAL ESTATE, LLC Party to Receive Copy of 1818 SWIFT ROAD Recorded Document and Billing: OAK BROOK, IL 60523 G/L Account # to be Charged: 10-1365 Prepared By: Village of Oak Brook Retur To: Village of Oak Brook 1200 Oak Brook Road 1200 Oak Brook Road Oak Brook, Illinois 60523 Oak Brook, Illinois 60523