Economic Development Committee

1 2 Minutes of the JOINT MEETING OF THE ECONOMIC DEVELOPMENT COMMITTEE and 3 NORTHBROOK INDUSTRIAL & COMMERCIAL DEVELOPMENT COMMISSION 4 Village Hall Board Room 5 January 25, 2017 6 EDC Members Present : Carol Currie, Ed Feld, Village President Sandra Frum, Tensley Garris, Jay 7 Glaubinger, Mike Gold, R. J. Gravel, Kate Hall, Molly Hamer, Larry Hewitt, EDC Chairman Jim Kahan, 8 Harley Korman, Karen Roloff, Richard Rushkewicz, Kenneth Slopicka, Joel Taub, Brian Wegley, 9 ICDC Members Present: Mark Freeman, Tensley Garris, David Gottlieb, Larry Herskovitz, ICDC Chairman 10 Patrick Lederer, Dick Leopold, Steve Lewis, Richard Rushkewicz, Tom Washburn, Curtis Wilens 11 Staff Present: David Schoon, Assistant Director, Development and Planning Services 12 Guests Present: Gina Speckman, Executive Director - Chicago's North Shore Convention & Visitors 13 Bureau; Ben Freeman, Vice President for Development - GGP (General Growth Properties); Adam Tritt, 14 Senior Director for Major Redevelopments - GGP (General Growth Properties) 15 Public Present: Irv Leavitt, Jean Streeter 16 Recorder: Sue Anetsberger 17 Call to Order & Introductions: 18 Jim Kahan, Chairman of EDC called the meeting to order in the Board Room of Village Hall at 7:30 a.m. 19 Review of Minutes 20 Regarding the October 26, 2016, EDC Meeting Minutes, a change should be made on page 4 of the 21 October 26 Minutes, under District #31, last sentence should be changed to read, "The Board of 22 Education approved the recommendation of the Education Foundation to move from IPads to 23 Chromebooks for grades 6-8 for fiscal year 2017." 24 A change on page 1 of the October 26, 2016 EDC Meeting Minutes under Community Planning & 25 Economic Development Coordinator Report, number 5 should read, "(5) Sober Living Facility at 1620 26 Sunset Ridge..." 27 On a motion made and seconded to approve the October 26, 2016 EDC meeting minutes, the minutes 28 were approved with corrections by unanimous voice vote. 29 Regarding the October 25, 2016, ICDC Meeting Minutes, a change should be made on page 1 of the 30 October 25 Minutes under Community Planning & Economic Development Coordinator Report, number 31 5 should read, "(5) Sober Living Facility at 1620 Sunset Ridge..." 32 On a motion made and seconded to approve the October 25, 2016 ICDC meeting minutes, the minutes 33 were approved with a correction by unanimous voice vote. 34 Comment-Hear from the Audience - None 35 Consideration of Continued Village Support of the Chicago North Shore Convention and Visitors 36 Bureau and the Northbrook Chamber of Commerce and Industry 1  EDC/ICDC Meeting Minutes – January 25, 2017 1 Gina Speckman, Executive Director of Chicago's North Shore Convention & Visitors Bureau reported that 2 the bureau has a staff of six individuals and the bureau represents the communities of Northbrook, 3 Evanston, Glencoe, Glenview, Skokie, Prospect Heights, Wheeling and Winnetka as well as private sector 4 business members. Ms. Speckman stated that CNSCVB has received an increase in their state grant 5 money, that they have a budget of $1.6 million, and that they have received their state funding. Liaison 6 Schoon reminded the commission members regarding the Village’s funding of the bureau by stating that 7 the Renaissance Hotel agreed to a hotel and motel tax increase to go towards funding the Village's 8 membership dues to join the CVB. Ms. Speckman spoke to the slides within the packet handout 9 displaying metrics to measure hotel occupancy rates and revenue. The hotel occupancy rate has stayed 10 flat this past year but average daily rate has ticked up. Her organization encourages awareness for 11 business meetings and leisure travel in order to increase tax revenues and stimulate economic 12 development and growth. She shared that business within the City of Chicago affects the North Shore. 13 Ms. Speckman spoke of two initiatives: (1) Restaurant Month, which begins February 1 with over 100 14 restaurants participating; (2) Dedicated web pages for each member hotel, including Northbrook hotels, 15 were created to help guests with car rental, airport transportation and maps. 16 Tensley Garris, President of Northbrook Chamber of Commerce & Industry stated that Northbrook is the 17 largest Chamber in the North Shore area with 719 members and a policy board of 20. The Chamber 18 provides services that include marketing, education, and networking within the community with the 19 Chamber acting as an advocate for individual businesses and representing groups of businesses. A 20 Northbrook Community Resource Guide is published annually as well as a Shopping/Dining Guide. A 21 cable commercial was aired between Thanksgiving and Christmas to promote shopping in Northbrook. 22 The Chamber also makes use of digital advertising. This past year the Chamber made efforts to increase 23 community service projects and programs. They contribute to the Civic Foundation Scholarship program 24 and have sponsored GBN's DECCA program. The Chamber also hosted Northbrook President Frum's 25 State of the Village speech. Liaison Schoon stated that the Village contribution to the Chamber is based 26 on a percentage of the hotel/motel tax that is collected each year. 27 A joint motion from EDC and ICDC was made and seconded to continue Village support for the North 28 Shore Convention & Visitors Bureau and the Northbrook Chamber of Commerce. The motion passed by 29 unanimous voice vote. 30 Discussion Regarding the Future of Retail and Impact on Local Shopping Centers 31 Chairman Kahan began the discussion asking what changes are occurring that could impact revenue 32 flows from the major non-residential assets of the community. The non-residential assets are an 33 important source of revenue that fund not only Village services but also other taxing bodies. Chairman 34 Kahan stated that Northbrook Court is one of the Village's biggest assets with its contribution of 35 property tax, retail sales tax, which is a major source of revenue to the Village. The rise of internet sales 36 is a concern. Chairman Kahan then turned the floor over to Ben Freeman, Vice President for 37 Development and Adam Tritt, Senior Director for Major Redevelopments from General Growth 38 Properties (GPP), the owner of Northbrook Court. 39 2  EDC/ICDC Meeting Minutes – January 25, 2017 1 Mr. Freeman and Mr. Tritt offered a presentation on the status of Northbrook Court and mall trends 2 across America with respect to vacancies, shifts from retail to other occupancies, lower foot traffic, and 3 the impact of internet sales. The representatives for GPP stated that their corporate mission was to own 4 and operate the best-in-class retail properties providing a retail experience for communities, retailers, 5 employees, consumers and shareholders. GPP shared that the industry is now changing its form from 6 the early 2000s. A slide of GPP's portfolio revealed that they own 100 of the best 500 retail centers 7 within the USA with A+ and AAA+ ratings. GPP shared that the today's mall profile includes diverse 8 restaurants, grocery outlets, entertainment, retail, as well as special services, and often community 9 space. The representatives also stated that 93% of all retail sales owe all or part of their existence to 10 brick and mortar (an online store with a brick and mortar presence) and 91% of all retail sales are 11 conducted in a brick and mortar shop. In 2015 catalog and internet sales combined for approximately 12 13% of total retail sales. The representatives stated that Millennials are looking for a more social and 13 interactive retail sales experience. Apple Stores were given as an example as one of the best retailers for 14 an experience and also offer in-store purchase opportunity. Millennials have the highest experience-to- 15 stuff ratio and do so at a higher rate than past generations did at the same age. It was suggested that 16 malls should focus more to attract millennials on the experience, getting them to dwell longer, and have 17 them visiting the mall more frequently by offering what is now trending and making changes to how the 18 mall asset is being used. Mr. Freeman and Mr. Tritt also encouraged the Village to be open to new and 19 different uses in a mall and to be flexible with zoning and development regulations in order to 20 successfully respond to the changing retail environment. 21 President Frum stated that the Village has had early conversations with GPP on how to achieve the goals 22 in meeting trending preferences of consumers. She stated there is a need to modernize the more 23 restrictive approval documents for the mall in order to move forward for redevelopment and 24 revitalization of the mall. The GGP representatives stated that 12% of the leases at Northbrook Court 25 will come up for renewal this year. 26 GPP representatives stated that the future of Northbrook Court can be better than the current 27 experience and offered that redevelopment has advantages of replacing underperforming anchor 28 spaces with regional nontraditional tenants and creating malls with flexible framework versus a narrow 29 prescription. GPP representatives stated that if they were building the mall today, the ideal situation 30 would be to maximize each tenant's exposure and visibility to Lake Cook Road. 31 GPP's goal is to create the best complement of uses in the right environment that brings bodies to the 32 mall and to the stores within the mall. They restated the need to tap into the habits of the consumer. 33 A member asked what was the retail sales tax revenue percentage coming from Northbrook Court. 34 President Frum stated that individual store sales tax information is proprietary, so the Village does not 35 have that number. 36 A member asked where Northbrook Court rates within GPP holdings. GPP answered Northbrook Court is 37 rated as an "A" mall. 3  EDC/ICDC Meeting Minutes – January 25, 2017 1 President Frum asked how Northbrook Court rates within the top 100 malls of the whole 500? GPP 2 answered that Northbrook Court is rated in the bottom half of the top 100 malls based on a 3 combination of square foot and revenue factors. 4 A member asked about the time table for redevelopment and repurposing. GPP answered that 5 redevelopment of big malls take 4-5 years to implement plans. 6 A member asked about how retail net sales improve when the retailer has an online presence and what 7 is the implication of that presence in terms of sales tax? GPP stated that some online companies are 8 moving towards a physical footprint. GPP answered that on the impact of sales tax, there are lots of 9 conversations about how internet sales work, how they are taxed and who should capture the sales tax. 10 Chairman Kahan thanked Mr. Freeman and Mr. Tritt for their very informative presentation. 11 Updates from Each Taxing District 12 Library - The Library is working with police on anti-Semitic vandalism within the building. The Board 13 approved a new Public Code of Behavior. The Library is working with the Village’s Community Relations 14 Commission on a celebration of cultures and will show foreign language films in the month of April. The 15 Library will offer an Accessibility Hour on Sunday, March 19 for patrons with special needs. 16 Park District - The West Park swimming pool construction is on schedule. Wescott Park will be open on 17 schedule. Lisa Chalem has joined the Northbrook Park District Board. The Illinois Association of Park 18 Districts recognized Penny Randel with the Mike Cassidy Commissioner Community Service Award at the 19 annual Illinois Park and Recreation conference. 20 District #27 - District 27 continues to be in a strong financial position. The tax levy for 2017 is Consumer 21 Price Index (CPI) 0.7% District 27 is dealing with HVAC issues with the money coming from the fund 22 balance. They continue to build a fund balance reserves. They continue to follow the state legislature 23 and their possible actions’ impact on school districts. 24 District #28 - This is the first year of full day kindergarten. The District is following the possible Green 25 Acres redevelopment. 26 District #30 - District 30 has shared the Master Facility Plan process. It is a long range plan for physical 27 and educational needs. The Citizen Task Force team recommended pursuing a new Maple Middle School 28 building. A referendum vote will take place on April 4 for the new building. District 30 has written a 29 letter that was not in favor of the proposed improvements that would allow Amtrak to increase its 30 Hiawatha service. 31 District #225 - The District is working with the incoming freshmen class. The District is watching what is 32 going on in Springfield. The District is looking at a potential two-year property tax freeze by the State 33 and the effects long term. All the schools together went out for a transportation bid but only received a 34 response from the current contractor due to the other bidders' concern of finding hourly help and hiring 35 quality drivers in the north shore area. 4  EDC/ICDC Meeting Minutes – January 25, 2017 1 Adjourn 2 On motion made and seconded, the meeting was adjourned at 9:17 a.m. The next EDC meeting is 3 scheduled for April 12, 2017 at 7:30 a.m. at the Village Hall. The next ICDC meeting is scheduled for 4 February 28, 2017 at 7:30 a.m. at the Village Hall. 5 Respectfully Submitted 6 Sue Anetsberger 5