Politics & Government
Westfield Hawthorn Expansion to Begin This Fall
Vernon Hills officials signed off June 4 on an economic incentive agreement with the mall, giving it the final go-ahead for its expansion.
Westfield Hawthorn’s redevelopment plans cleared the final hurdle Tuesday night, when Vernon Hills officials approved an economic incentive agreement with the mall. Residents can expect to see construction begin this fall.
Under the agreement, Vernon Hills will pay the mall $12.9 million over the course of 10 years. The money includes a $10 million sales tax revenue rebate for Westfield-owned spaces and a 6 percent interest rate. The agreement will automatically renew for three years if the money is not paid in full at the end of 10 years.
“We both want to have this paid off quickly … but in case it takes longer, we just want to have the opportunity to take advantage of the deal we’ve struck,” said John Genovese, Westfield’s senior vice president of development. “Our projections and [the village’s] projections show it happening within the 10 years.”
The agreement will also allow the mall to request an additional two-year extension should revenue decline due to “negative economic events,” according to a summary of the agreement.
Also included in the agreement are provisions for future Westfield tenants. Should the new AMC Theater or Dave & Busters leave, replacement businesses must meet guidelines pertaining to the percentage of space they’ll take up and how much sales tax they’ll generate to prevent large, vacant spaces or major revenue reductions.
Ground will be broken on the new AMC building in three to six months, Genovese said.
The mall’s owner plans to invest $50 million in Hawthorn’s redevelopment, which will include construction of an AMC Theater between Sears and JC Penney. The theater is expected to open by November 2014. Westfield officials are also working to draw new tenants to the property. Dave & Busters will occupy an existing mall space.
Vernon Hills’ sales tax revenue will be protected if existing businesses decide to relocate to the mall. Under the agreement, the village will not share sales tax revenue if stores larger than 5,000 square feet leave another shopping center in favor of a mall storefront.
“Some people might want to move because the mall is moving on up and they want to be a part of it,” explained Village Attorney Robert Kenny.
The village will, however, share sales tax with Westfield in the event that an existing Vernon Hills business wanting to expand either can’t grow in its current location or would leave the village if it couldn’t relocate to the mall.
“It’s really trying to cover the future that we don’t know,” Genovese said. “In the world of retail, there are so many factors that come into play. It’s not a cut and dry situation.”
That provision also will not apply to AMC Show Place 8.
“At some point, the Show Place might close. We have not heard that from AMC, but it might in the future,” Assistant Village Manager John Kalmar said.
Westfield, meanwhile, will pay $200,000 to the Countryside Fire Protection District to assist with unspecified capital improvement costs.
The agreement was approved 5-0 by Vernon Hills trustees. Trustee Barbara Williams was absent, as was Village President Roger Byrne.
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