Argianas & Associates, Inc. Page 1 of 16 09-512-19 September 17, 2019
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5509 Belmont Road 5509 Belmont Rd., Ste B Downers Grove, IL 60515 630-390-0113 phone 630-390-0114 fax www.argianas.com September 17, 2019 City of Geneva Planning and Zoning Commission 22 S. First Street Geneva, IL 60134 RE: Geneva Center 2015, LLC / MidAmerica, 2100 S. Randall Road, Geneva, IL 60134 - Lot 1 in Fabyan Crossing, PIN 12-17-226-004 – Proposed Oberweis Dairy Store with That Burger Joint and Woodgrain Pizza Restaurant Concepts to be Sited on a Proposed Outlot (Portion of Lot 1 - Northwest Corner of Randall Road and Fabyan Parkway, Fabyan Crossing Shopping Center) At the request of Joe Oberweis, Oberweis Dairy President/Chief Executive Officer, I have reviewed documents, building plans, and contemplated construction costs associated with the proposed development as identified in the caption block of this letter (a proposed Oberweis Dairy Store with adjoining That Burger Joint and Woodgrain Pizza Restaurant), with existing Fabyan Crossing tenants that currently include a Fresh Thyme Grocery Store, At Home Furniture Store, Best Buy, O'Reilly's Auto Parts, Spenga Fitness Center, and a McDonald's Fast Food Hamburger Restaurant. Fabyan Crossing Immediate & Near Surrounding Area The area surrounding Fabyan Crossing features an expansive mix of commercial space users that include, among others, a Home Depot, Petco, Trader Joe’s, Walgreens, Bank of America, Smashburger, Jersey Mike’s, Starbucks, Chipotle, Papa Johns, KFC, McAllister’s Deli, Advance Auto Parts, Portillo’s Hot Dogs, GQT Randall 15 IMAX, Jurin Japanese Restaurant, China Taste Restaurant, Panera Bread, Ashley HomeStore, Mario Tricoci Hair Salon & Day Spa, Ross Dress for Less, Marshall’s, Bed Bath & Beyond, Party City, Fifth Third Bank, and First American Bank, with other nearby neighbors that include Walmart Supercenter and the Advocate Medical Group Outpatient Center. In short, the subject’s immediate and surrounding areas are host to an array of big box retailers, grocery stores, sit down and fast food restaurants (many of which operate drive throughs), and professional service providers. Argianas & Associates, Inc. Page 1 of 16 09-512-19 City of Geneva Planning and Zoning Commission September 17, 2019 Page 2 The McDonald’s Groundlease At issue are groundlease covenants associated with the McDonald’s Groundlease (signed October 20, 1994) associated with the McDonald’s sited on Lot 4 of Fabyan Crossing Shopping Center, with a groundlease provision for 50% rent abatements should other restaurants, food service establishments, drive-in or walk up eating facilities be allowed. This rent abatement covenant and the risk of its realization were and have remained part of the McDonald’s groundlease since its inception. The Proposed Oberweis Development Will Not Result in Any Value Diminution The following issues are presented, with September 14, 2019 identified as the value date associated with my findings as to whether the Oberweis dairy/burger/pizza concept, if allowed, will diminish the value of adjacent and nearby properties. To answer these value-based questions, I reviewed development plans associated with the overall Fabyan Crossing Shopping Center and the proposed Oberweis Concept, the McDonald’s Groundlease, court-related plaintiff and defendant documents, the recorded plat for Oberweis Subdivision, building plans, a floorplan and exterior elevation plan, a photometric plan, and signage drawings for the proposed Oberweis development. I also considered real estate values associated with other Oberweis dairy/burger/pizza restaurant locations in Bolingbrook, Bloomington, and Champaign, I field-inspected the subject property and conducted reconnaissance to familiarize myself with its neighborhood area, and I carefully considered whether the proposed Oberweis concept was consistent with the requirements of Section 11-14-4(F) of Geneva’s Code of Ordinances (the Code). As evidence that the Oberweis concept will not diminish the value of adjacent and nearby properties, we researched assessed values for existing Oberweis Dairy Store with That Burger Joint and Woodgrain Pizza Restaurant stores, with our findings summarized as follows: Argianas & Associates, Inc. Page 2 of 16 09-512-19 City of Geneva Planning and Zoning Commission September 17, 2019 Page 3 ! ! ! ! ! " ! # ! $ ! % ! & ! ' :82+ %$ 4236 % #*999#$ %$ 34,24,23,423,227,2222/ 769*222 /769*222 /769*222 /769*222 /792*46: /7;;*267 /7;;*267 " * 82662 "*:77+ %$ 34,24,23,425,226,2222/ 327*922 /327*922 /327*922 /332*3;4 /337*979 /954*722 %$( #*:62+ %$ 34,24,23,426,22;,2222/ 673*222 /673*222 /673*222 /673*222 /692*38: /6;5*;33 /6;5*;33 % '#! 4327 +$"# "'( 4239 ) ))*3823+ &%* " 36,48,548,247 /3;5*578 /475*959 /528*:;5 /56:*656 $ * 83926 *323+$"#* " 36,48,548,256 /3;4*773 /553*45: /553*45: /58;*295 %$( -#*4329$"- "'(* $ 36,48,624,224 /643*797 /652*928 /652*928 /652*928 " '#! #*3757+ &+* " 36,48,549,224 /523*:2: /52;*274 /52;*274 /52;*274 $ *432; +$"#* $ 36,48,624,223 /8*388*889 /8*522*454 /8*522*454 /8*522*454 3;27+ $"$ 423: %&"#*4524 $"$ 67,42,46,624,245 /473*942 /479*222 /479*222 !* 83:42 #*3827+ $"$ 67,42,46,423,24; /594*752 /5:2*582 /5:2*582 ! %$( $ *3;26+ $"$ 67,42,46,474,233 /7:*5;2 /7;*842 /7;*842 !$( '#! $-*392;+ $"$ 67,42,46,423,272 /457*432 /462*372 /462*372 These assessed values are offered as evidence that the Oberweis concept has not resulted in value diminutions to neighboring properties and we believe the addition of an Oberweis concept will enhance the marketability and values of neighboring property owners. Argianas & Associates, Inc. Page 3 of 16 09-512-19 City of Geneva Planning and Zoning Commission September 17, 2019 Page 4 As a result of our investigations, I have concluded no value diminutions to either the McDonald’s Groundlease, Fabyan Crossing Shopping Center, or the surrounding neighborhood area for the following reasons: 1) The proposed use at the specified location is consistent with the comprehensive plan. The property is designated for Commercial: Retail, Service, Office uses in the City’s adopted Comprehensive Plan, with consistent land uses for surrounding properties. The Oberweis proposed drive-through restaurant as contemplated is consistent with the Comprehensive Plan. There is no evidence I could find suggesting that the opening of a new restaurant at Fabyan Crossing would be inconsistent with the comprehensive plan or result in value diminutions. 2. The proposed building or use will not diminish the value of adjacent and nearby properties. Fabyan Crossing was developed for shopping center use in 1995, with a variety of nearby restaurants also sited located along Randall Road in neighboring shopping centers and with restaurants a permitted use within the PUD. Oberweis is proposing to add revenue generating capabilities of Fabyan Crossing on Lot 1, which has been vacant since the inception of Fabyan Crossing. Oberweis’ proposed development will be compatible with the neighboring McDonald’s Restaurant, it will have adequate parking, and new customers will be attracted to the area including Fabyan Crossing Shopping Center. Those customers may also visit stores within Fabyan Crossing, including At Home and even, McDonald’s. Even if McDonald’s invokes its Groundlease Provision concerning competing restaurants, there is no evidence that will result in a diminution of property values. Based on my research involving other areas in which Oberweis and McDonald’s Restaurants overlap, the entry of Oberweis has been followed by increases in McDonald’s property values. For the reasons stated, there is no value diminution to Fabyan Crossing Shopping Center or to the McDonald’s Groundlease as the Oberweis concept should draw more customers to Fabyan Crossing. Even if property values decrease, which they will not, such decreases are more than offset by Oberweis’ value to the community (for example, the proposed Oberweis will bring additional tax revenues to the community, and there will be no need for area customers to travel to Oberweis’ stores on Main Street or in St. Charles or North Aurora to fulfill their needs for Oberweis products). Argianas & Associates, Inc. Page 4 of 16 09-512-19 City of Geneva Planning and Zoning Commission September 17, 2019 Page 5 3. The proposed use at the specified location will not substantially or unduly increase traffic, traffic congestion and on-street parking demand in the immediate vicinity of the proposed use and in the area affected by traffic generated by the proposed use. Fabyan Crossing Shopping Center is provided with around 1,200 parking spaces, with an overall parking ratio of approximately 4.6 spaces per 1,000 square feet of floor area. Oberweis’ proposed concept will not unduly increase traffic or traffic congestion in the immediate vicinity and its drive-through features will accommodate 10 cars in the queue with any overflow contained within the parking lot. The traffic flow surrounding Fabyan Crossing is regulated by traffic lights and stop signs, the proposed Oberweis concept’s parking needs have been well planned, the proposed use at this location will not increase on-street parking demand in the immediate vicinity. For the aforementioned reasons, there will be no value diminution to neighboring properties due to traffic or parking associated with the proposed Oberweis concept. 4. The proposed use has been designed to provide for adequate ingress and egress to minimize potential vehicle conflicts and congestion in public streets. The proposed use will not alter existing ingress and egress points for Fabyan Crossing Shopping Center, which consist of two right-in and right out entrances and two signalized entrances, with the site designed to properly facilitate emergency vehicle navigation to and from the subject site. As the Oberweis development will utilize existing private drive connections to adjacent public streets, and because the proposed use has been designed to provide adequate ingress and egress to minimize potential vehicle conflicts and congestion in public streets, there will be no value diminution to the area by virtue of the proposed Oberweis concept’s ingress/egress needs.