Industrial or retail?

Two and a half years ago, the former Huntley Outlet Center died after a long struggle to survive.

Now, the opportunity for the Huntley government to decide what happens to the former mall property has been taken away from the village, and given to a McHenry County Circuit Court judge.

In other words, a lawsuit has been filed for the fourth time in this long-running development saga.

For the last couple of years, the village and a group of corporate landowners have been unable to agree on what to do with the 60-acre site. The partners want industrial office/warehouse facilities, and the village wants a regional retail center as part of a new Gateway project wrapped around a part of the intersection of I-90 and state route 47. One key question remains: shall the site contain industrial or retail facilities?

Facing off against the village are three companies that now own the empty, 60-acre site in far south Huntley along the north side of the I-90 tollway. Huntley Investment Partners (HIP) includes three corporate development companies: The Prime Group, which built the former factory shops mall in the 1990s; Capital Realty and Development of Elgin; and Craig Realty in California, a company that manages outlet malls in the western part of the U.S.

Now, Huntley Investment has put this long, controversial debate in the hands of a McHenry Country Circuit judge yet to be named. On July 2 of this year, following a series of meetings among the village board, staff, plan commission, and HIP officials, the landowners filed a lawsuilt, challenging an April 11, 2019 village board decision to reject, by a 4-2 vote, a proposal for a rezoning application and special use permits for a proposed industrial warehouse development. A month earlier, the village plan commission had approved the industrial proposal by a narrow 4-3 vote.

The suit charges that the village board’s decision was “arbitrary, capricious, and unreasonable,” based on eight factors used in a similar legal dispute in 1957 and 1960 in Chicago and Cook County.

In 2017, shortly after the outlet mall was left empty, the mall buildings were demolished in settlement of a village lawsuit against landowners for ordinance violations in the maintenance of the mall. Later that same year, the current landowners applied to the village for a zoning change from Regional Retail to ORI-Office/Research/Industrial District and special uses for a warehouse planned unit development. The Village Board denied this request in 2019.

The plaintiffs now claim that the village’s plan is not consistent with nearby property, (example, the huge Weber Grill distribution warehouse a short distance east of the mall site on Freeman Road), the effort to maintain retail diminishes area property values and doesn’t promote the health, safety, or general welfare of the public, the village denial imposes a hardship on the property owners at the expense of gain to the general public, the site isn’t suitable for retail, the community doesn’t need retail there, and the village has not planned its land use development with care.

To prepare this report, the Sun Day obtained a copy of the 70-page lawsuit when village officials declined to comment on the lawsuit, and interviewed Rich Turasky, president of Elgin Realty and Development, one of the landowning companies. The newspaper reached out to three village staffers, but village manager Dave Johnson confirmed the “no comment” policy on pending litigation.

“It is a travesty that the village is taking this stance,” Turasky said. “The village is losing jobs, income, and support from other businesses in the community. We have been trying to redevelop this site with the best interests of the town in mind. Starting in 2016, we first tried to save the mall, but weren’t successful, leading us to conclude retail zoning wasn’t suitable for this site. Later, we contacted two area organizations, Camping World, and Greco Foods, to determine their interest. Nothing worked out. Then, we decided to build three speculative industrial warehouse buildings because the area market was telling us that’s the type of zoning they wanted.

“Huntley isn’t Oak Brook, with its high property values,” Turasky also said. “Huntley needs a long term vision for properties like the former mall site. We have proposed a $60-$70 million investment in what the market says it wants, and we just can’t work with the village. The plan commission supported us but now we are stymied, so we have asked a county judge to help us.

“This suit is going to cost the Village taxpayers up to $600,000,” her continued, which they could have avoided. They have a crazy idea that retail isn’t a dying thing at this site. The village’s idea of a retail gateway in this area is different from what the market is telling us. The village is not paying attention to the market and is not a welcoming community. All the residents of Huntley should contact village officials and ask what is going on.”

According to the first page of the lawsuit, an initial scheduling conference is set for 9 a.m. on October, 1, 2019, in the McHenry County Courthouse in Woodstock.

(In a second installment report about this controversy in our next issue, the Sun Day will trace the history of the Huntley Outlet Center events.

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