Elgin officials have confirmed reports that Stein & Co. has withdrawn from negotiations with the city to act as exclusive developers for the downtown South Grove redevelopment project.
”We were not happy to learn this,” City Manager Larry Rice said late last week. ”We lose a little ground. Hopefully we won`t lose too much.”
Rice called a news conference at City Hall to make the announcement, something Elgin officials rarely do.
Stein, a Chicago-based company that has developed about $2 billion worth of properties since its founding in 1971, was to have marketed 21 acres of vacant, city-owned land to the south of Elgin`s pedestrian mall.
But in a letter to the city dated last Thursday, the company cited a softening of the economy and tightened ”capital requirements and loan underwriting standards for commercial banks lending to the real estate industry” as the chief reasons for its decision to pull out.
”We do not believe the timing is right to focus our corporate resources on speculative land developments,” the letter stated.
Rice said Elgin is ”caught as a victim” in Stein`s corporate refocusing from development to property management. But then, ”downtowns are never easy,” he said, adding that redevelopment is ”a difficult long-term process.”
Sasaki Associates Inc. of Watertown, Mass., a consulting firm, is working on a $250,000 comprehensive plan for the revitalization of Elgin`s moribund downtown. The firm is expected to complete the plan next summer.
Though Stein`s withdrawal is a blow, Rice said that ideally the comprehensive plan should be in place before development of South Grove occurs.
Elgin first needs to decide ”how it wants its downtown to be developed” within the scope of economic realities, he said. Developers, he added, want to know what`s going to happen around them.
Elgin is already seeking a new developer for the property and is continuing to pursue projects already started, according to Rice.
