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Arlington Heights trustees Monday gave enthusiastic preliminary approval to a $250 million redevelopment plan for 25 acres at the southwest corner of Euclid Avenue and Rohlwing Road where a derelict former Sheraton hotel stands.
Reviewing the plan, to be known as Arlington Downs, Argent Group’s Carl Groesbeck told trustees Monday the mixed-use redevelopment to be built in phases over five years will begin with conversion of the former 429-room hotel into nearly 200 luxury studio and one and two bedroom rental apartments.
“The hotel can be turned into a marvelous rental building,” said Groesbeck, adding the result would be “almost an urban mixed-use development as a gateway to Arlington Heights.”
Conversion of the 12-story former hotel, referred to as Tower 1, will also include a ground level restaurant and a fitness center open to the public. The hotel’s basement will provide two levels of underground parking.
While the old hotel will go away, two new hotels are planned. The first, with around 100 rooms, will open in conjunction with the re-opening of the former CoCo Key Water Resort on the property.
According to village sources, Argent is partnering with an experienced water park operating company to re-open and run the water park and construct the first hotel. A second hotel is also planned, with about 200 rooms targeted more towards business travelers, according to Groesbeck.
The third phase of the project calls for construction of two apartment towers, one of 19 floors and one of 14 floors with a combined total of 470 rental units.
“We feel there is a very strong rental market both nationally and locally,” Groesbeck said.
Completion of the project could take up to five years. Final phases are to include five, one- or two-story commercial/retail buildings. Those buildings, Groesbeck said, would incorporate cupolas and other design elements meant to provide visual association with Arlington Park to the east.
Trustees were enthusiastic about the plan — Thomas Hayes called the project exciting, Carol Blackwood called it beautiful. Village staff estimate the project when completed will add nearly $1.6 million annually to village revenues. That includes the village’s share of property taxes, sales, food and beverage, hotel and utility taxes — about three times what the Sheraton generated for the village before its closing two years ago.
But trustees did raise questions about some aspects of the project.
Several trustees expressed concerns the number of planned parking spaces were far short of village code requirements. But traffic engineer Steve Corcoran said renters were unlikely to have the two cars per unit called for in village code.
“We’re confident we’ll have sufficient parking,” Groesbeck said.
In response to questions about storm water detention, Groesbeck and village staff agreed that adequate underground detention will be provided.
Concerns about tenants reaching the Metra commuter rail station to the east will be met with a combination of bike and pedestrian paths and a shuttle bus, according to Groesbeck.
Argent has agreed to provide some affordable housing units as part of the development, although those will not be included in the hotel conversion. Those units, including some for veterans, will be in the two new high-rise apartment towers.
The preliminary planned unit development approved by trustees will come back to the Village Board as an ordinance at its next regular meeting on Feb. 20. Once that is approved, developers can proceed with the final planned unit development and plats of the project.
Groesbeck said after the meeting he hopes to begin work on the hotel conversion by May, aiming to have units ready for rental by May of 2013. He estimates the entire project could take five years to complete.
“This is the first major development we’ve had since the late 1990s,” said Mayor Arlene Mulder. “It’s an exciting project, but five years is too long…I hope you beat your own schedule.”
