Creating Its Own Good Luck
In the Village of Hoffman Estates, Illinois, retail development is on the move. The city has taken matters in its own hands by creating TIF districts and being proactive about new retail development.
Dan Marcec

The phrase “Growing to Greatness” adorns the village seal of Hoffman Estates, Illinois, and the extensive retail development in this northwest Chicago suburb is an indication that the village is dedicated to achieving its goal. Founded in 1959, the village is located approximately 30 miles from downtown Chicago, and it boasts a population of nearly 51,000, a number that, according to Gary Skoog, Hoffman Estates' economic development director, is growing by leaps and bounds.

Several factors have led to Hoffman Estates' rapid growth. To the west of the village, new residential communities are being built. Over a 5-year period, Hoffman Estates will see the development of 5,000 new residential units, which inevitably has led to a marked increase in retail development, as retailers are taking note of increasing relocations to the area. The village has been actively concentrating on economic development, and since it has opportunities to expand on open land, Hoffman Estates wants to take full advantage of its assets. With all the development currently planned or underway in Hoffman Estates, the village is trying to establish itself as a destination for residents and consumers.

Current Retail Projects

Retail development is on a significant upswing in Hoffman Estates, as the village currently has over $300 million in either planned or existing retail projects.

“It's a big number for a community our size,” says Skoog. A new retail development, Fountain Crossing, will feature several new restaurants, one of which is La Strada. The owner, who lives in the nearby town of South Barrington, recognized the need for a high-end, white tablecloth restaurant in Hoffman Estates. The original La Strada is located on Michigan Avenue in downtown Chicago, and while Hoffman Estates boasts a number of national chain restaurants, the new La Strada will offer a different option for residents and local consumers, featuring 10,000 to 15,000 square feet including party rooms.

Menard's hardware store is planning to expand its services in the Hoffman Estates area as well. Currently occupying roughly 100,000 square feet at 2300 Higgins Rd. in the Barrington Square shopping center, it has outgrown that location and will build a two-story, 228,000-square-foot store near the Hoffman Village shopping center located on North Barrington Road. While plans for the project are not quite finalized, Menard's looks to begin work on the development this summer.

In addition to these projects, several car dealerships are planning expansion and development in Hoffman Estates. Motorwerks will construct a new Infiniti dealership, and directly across the street, it is expanding a Mercedes-Benz dealership by 36,000 square feet. An Acura dealer is adding 180 parking spaces to its lot, and in the future, it will build a new office adjacent to its location on Higgins Road. A Nissan dealer is also constructing a significant expansion to its existing dealership.

Generally, these projects are being developed individually, and Skoog has an increasingly positive outlook on the village's economic development activity.

“All of a sudden we've had an explosion of activity in Hoffman Estates, and we feel good about it,” says Skoog. “Our Board of Trustees has been very supportive about making these things happen, knowing how important it is to have new income sources coming into our municipal government; because of rising costs, everyone's looking for additional revenue for their budgets.”

Creating A BID

While significant development is occurring across the village, Hoffman Estates is also focusing on its Business Improvement District (BID). This particular redevelopment project has been on the village's agenda for about 5 years, and the original goal was to upgrade some of its tired, older shopping centers. Within the last couple of years, the village has seen the development of one of the retail centers in the BID, which features Valli, a unique, independent international market that offers products from around the world, catering to international customers. Now, with other tenants including Laser Quest, an Asian restaurant, and a video store, the center has been so successful that it has a parking problem.

Golf Rose Annex is a small shopping center adjacent to the Golf Center, which will also benefit from a new façade that will improve and update the center's appearance from Higgins Road.

In effect, after monitoring and gauging the outlook for the BID, the village board developed a plan to upgrade the area into a gateway for the community. Not only did the board notice the slowly depreciating developments, but also residents were complaining that the centers were not looking well. Therefore, these concerns really spurred the village into action in order to make its residents proud as well as attempt to attract more retailers.

“As a government, we're trying to create an environment, an infrastructure, and incentives in order to attract clusters of retailers,” says village manager Jim Norris. “If we try to get a good anchor, that will spur ancillary development, and then the rest will fall into place.”

Golf Center, located in Hoffman Estates' Business Improvement District, will enjoy a totally new façade to provide an enhanced area for signage to create detail and spark consumer interest. These updates, along with parking lot landscaping, will provide vast improvements to the center.

Economic development director Skoog explains that the BID project has been on the front burner for a number of years, and several shopping centers are involved in the redevelopment. Located in the TIF area, Golf Center and Hoffman Plaza will be making progress this spring. Both developments were built in the 1960s, and Robin Realty, which owns Golf Center, is planning a $2 million upgrade. The renovations will raise Golf Center's façade 10 feet, effectively creating a brand new look, and they will completely revitalize the parking lot in terms of adding trees, etc. Harlem Furniture, Michaels, T.J. Maxx, Payless Shoes and Factory Card Outlet are some of the national chains already occupying Golf Center, and in addition, local hair salons, florists and fast food places fill the rest of the space. Skoog notes that the center is attempting to attract some larger chain restaurants in order to create more traffic and upgrade the type of tenants that are already there.

The proposed renovations for the exterior at Hoffman Lanes, located at Higgins and Roselle roads, represent the developers' original proposal for creating a new look for the bowling center.

Aside from Robin Realty, Los Angeles-based Festival Cos. has been selected as a developer in the TIF area if the village cannot come to terms with the existing owners. Furthermore, Hoffman Estates has sought specific retailers through a variety of avenues. The village has sent letters of interest to Cabela's, and Target has agreed to anchor Poplar Creek Crossing. Skoog adds, “We've been reaching out through various things like the ICSC, direct mail, soliciting and recruiting. In our case, I think it's more like ‘you create your own good luck.'”

On the Horizon

At the corner of Illinois Routes 59 and 72, Dallas-based Archon Retail is developing Poplar Creek Crossing. Anchored by a 124,000-square-foot Target, the power center is situated on 40 acres adjacent to the Prairie Stone Business Park. The entire complex will encompass 400,000 square feet upon its completion in second quarter 2006. Leopardo Companies, headquartered in Hoffman Estates, is the contractor for this development. In addition, Matt Norton of Holland & Knight LLP negotiated an annexation agreement for the center, representing both the owner and Archon before the village in obtaining approval for zoning and the site plan.

Aside from the Target, the sub-anchors are still being negotiated by Mid-America Real Estate, which is handling leasing for the project. Although the tenants are not set, Skoog notes that they most likely will include apparel shops, electronics stores, pet stores and home accessory retailers. In addition, the center has been negotiating with Claim Jumper, a Southern California-based restaurant. If they decide to build in Hoffman Estates, it will be the restaurant's second location in Illinois.

Looking toward the future, one of the biggest projects in the Hoffman Estates retail sector is the plan for constructing Sears Centre, an 11,000-seat arena that will be located in the Prairie Stone Business Park area. While the outlook on this development is positive, approval is still pending in front of Hoffman Estates' village board. Despite the fact that the project is not yet finalized, the village board and Minneapolis-based Ryan Cos., the prospective developer, are excited about the possibilities. Sears is a partner and will pay $1 million a year to provide the arena's namesake, and if completed, the entertainment arena will feature concerts and family entertainment. In addition, there have been discussions with different hockey leagues about fielding a team, and plans for skyboxes and preseason ticket sales are already under consideration. If the project follows through, it would provide an excellent catalyst for extensive retail development in the area.

Finally, the possibility that Hoffman Estates may bring a Cabela's to the area has caused a stir of excitement throughout the village. Cabela's is a prominent outfitter for fishing, camping, hunting and outdoor gear, bringing as many as 5 million to 6 million visitors each year to many of its stores. Shoppers typically spend roughly 4 hours in the store, and oftentimes, 30 to 40 percent of customers come from out of state planning to spend a weekend, bringing a boost to the local economy. If both Cabela's and the arena proposal come to fruition, the area located at Illinois Route 59 and Interstate 90 would likely become a tourist destination for the upper Midwest. Obviously, attracting Cabela's is a Number 1 goal for Skoog and Hoffman Estates, and locally, these future prospects certainly have created a huge stir of excitement.

Economic and Community Impact

As far as economic impact is concerned, Skoog explains that “it's not a quantifiable number right now, since there are a lot of pending contracts and pending negotiations.” However, if some of the projects are approved and completed, namely Cabela's and the arena, Hoffman Estates will see a significant increase in employment and additional retail development; a Cabela's store alone would create 500 to 600 new jobs. In general terms, Skoog believes there will be a substantially positive upswing from job creation and property and sales tax increases.

The Greater Woodfield Convention and Visitors Bureau is also pushing for regional tourism and looking at regional branding, and Hoffman Estates' prospective developments would be an excellent aid in terms of these goals. New employment opportunities and revitalized retail centers will not only draw new residents to Hoffman Estates, but also they will continue to draw other developers and tourists, making the village an increasingly popular place to live and shop. With the Chicagoland suburbs becoming built out, residents are looking for a place where they can stretch out; and Hoffman Estates is providing popular retail and enticing amenities for these prospective residents including 4,000 acres of forest preserve. In effect, the rapidly advancing retail development not only will be good for Hoffman Estates, but also for surrounding communities, which is very positive from a regional perspective.