Highland Park City Council Rejects Downtown Real Estate Office

HIGHLAND PARK, IL — Highland Park denied a permit for a real estate office to open up shop at the site of a former bank on a downtown corner in a part of the city's central business district zoned for pedestrian shopping. The City Council voted unanimously Monday to reject a planning commission recommendation to allow a Baird & Warner residential real estate office to operate at 579 Central Ave. at the corner of 1st Avenue. A PNC Bank on the site closed last April.

The location falls within the Pedestrian Oriented Shopping Overlay (POSO), a zone in which all ground floor storefronts can only be used for retail or service businesses. Because the office would not conform with the city code, the property owners and potential lessee sought a special use permit, which the Plan and Design Commission recommended 5-1 on Feb. 20.

Several member of the council shared their reasons for rejecting the permit application prior to the vote. In addition to concerns about a lack of parking, council members expressed concern that granting an exception to the rule would significantly weaken it.

On March 26, Mayor Nancy Rotering said the restrictions were intended to bring more foot traffic downtown and increase sales tax revenue.

"One of the data points that we watch every month is sales tax revenue per square foot. This does not contribute to those efforts when we're trying to address resourcing revenues from places that are other than property taxes," Rotering said. "Having Baird & Warner on one of the most important corners of that pedestrian overlay is not contributing to that, nor has this area contributed for the 35 years. So the goal would be to bring it in and have more retail or restaurant, or something along those lines, in that space. That's the goal."

For the last 35 years, the space has been leased to financial institutions, and the last time it had housed a retail tenant that would have conformed to code was Chestnut Court Bookstore in the late 1970s, according to a letter from owner Herbert Loeb.

The POSO restrictions on what kind of businesses property owners could lease to were implemented in 2004 after concerns about too many drive-thru banks, Pioneer Press reported. Facing an increase in vacant storefronts, the City Council reduced the zone's size last September.

Under city code, when a non-retail business in the zone moves out, the property owner can only replace them with another non-conforming business if the use is of equal or less "intensity," a term that city staff acknowledged was open to subjective interpretation.

Councilwoman Alyssa Knobel said it "flies in the face of the changes we just made" to recommend a non-conforming use of the site. She said the real estate office would certainly be a more intense use and have a negative impact on parking in the area.

"If we allow this, then we'd have to go back to the drawing board and have a discussion about the POSO again, which I don't think that it's time to do – being that we're still trying to attract restaurants and retail," Knobel said.

Councilman Anthony Blumberg, the liaison to the plan commission, said the corner of Central and 1st avenues is a major corner of the pedestrian zone. He said non-conforming properties were expected to be phased out over time as their leases expired, and it would hinder the growth of the district to allow an exception in this case.

"In an effort to make our plan work, we are looking for properties to comply with the plan and will not impair surrounding properties from being part of that plan," Blumberg said. "If you continue to allow a piece of property like this in the heart of the POSO, that sets a difficult example for the surrounding properties. We have filled most of the properties along Central and this should join them."

Joan Loeb, the wife of the property owner, spoke at the March 26 meeting. She said there was only one other interested potential renter and remarked on the large number of vacancies in the area.

"Anybody coming into Highland Park and walks down Central Avenue and sees the places for rent is not going to be terribly impressed," Loeb told members of the council. "I would think that one of the main things that you want to do is get those places rented."

A commercial rental listing for the nearly 4,000-square-foot site posted last year did not disclose how much rent the Loebs were asking for, and Baird & Warner has not responded to an inquiry about the deal. Current active retail rental listings in the area range from $20 to $30 per square foot, which would price out to monthly rents of between $6,700 to $10,000 for the space.

"The POSO stands wonderfully if business is good. When business is not good, you're going to have those empty stores," Loeb said. "I just cannot see having papered windows versus having a live, what I would say, occupied, attractive place." She said the potential lessees wanted to make their residential real estate office a "community center" that would encourage pedestrian traffic.

Lynn Kosner, the managing broker of the Highland Park branch of Baird & Warner, suggested that the office would attract many visitors from outside of town and bring a "vibrancy" to the corner.

"This is a great way to increase visibility for Highland Park in general just by having us there," she said. "It will add something to Central Avenue that's definitely lacking now that our town and our community really needs."

There are at least a half-dozen real estate agencies and residential brokerages within a two-block radius of the site, counting Baird & Warner's existing 1920 Sheridan Rd. location. The mayor pointed out another realtor in the second floor on the very same corner of Central Avenue is currently operating in compliance with the law.

Earlier this month, property owner Dino Dimitrio told the Plan and Design Commission the corner was prime real estate for retail, Pioneer Press reported. He said the city might as well give up on the whole idea of the POSO zoning district if it was going to exempt the site from its rules. Baird & Warner's offices would have relocated about 1,000 feet away.

"All you are doing is replacing one vacancy with another," Dimitrio told the commission last month.

Monday, Councilman Daniel Kaufman explained he opposed the project because he was unable to say "with any evidence that's reassuring enough" that it would be a less intense use than the bank was. The other three council members in attendance did not comment before the vote, apart from agreeing with what had already been said.

Resident Steven Adatto, who asked not to extend any more non-conforming uses for the property, presented petitions to the council against allowing the real estate agency.

"We would love to see a retail space go in there, with retail dollars coming to our city," he told the council. "Or a restaurant, I think that'd be a marvelous location for one."