ECONOMIC DEVELOPMENT COMMITTEE MEETING

Wednesday, April 22, 2015

Council Chambers – Countryside City Hall

Ald. Sean McDermott, Chairman, called the meeting to order at 6:30 p.m. He called the Roll of those physically present:

PRESENT:Ald. Sean McDermott, Chairman, City Admin. Gail Paul,Ald. Robert Pondelicek, Ald. James Jasinski.

Also Present:Clerk Sweeney, Ald. Musillami, Ald. Von Drasek, Ald. Michalczyk, City Atty. Peck, Asst. Admin. Peterson.

Approval of Minutes

Ald. Pondelicek moved to approve the minutes of February 25, 2015 as presented, seconded by Ald. Jasinski and carried by unanimous voice vote.

Consideration of request from Pearlshire Countryside (Holiday Inn) to increase the incentive offered in the tax sharing agreement.

Mr. Rehan Zaid, Pearlshire Capital Group, provided an update for the committee re: renovations at the Holiday Inn Hotel. He stated that during the first quarter — the occupancy rate was down 11% in January, 9% in February and 2% in March compared to last year. In surveys conducted with customers and business associates the general consensus is that the downturn is mainly due to the condition of the property; guests are seeking alternative sites in Oak Brook, Burr Ridge and surrounding areas. Pearlshire is requesting $1.5 M for the package that meets their requirements and fills the capital gap for renovation plans presented to them by the franchisor IHG-Holiday Inn.

Chair Ald. McDermott stated that the last figure offered by the City was $1.140M with permit fees being waived. City Admin. Ms. Paul stated that the City increased the incentive to cover the permits. Ald. McDermott stated that the offer may not increase but the City is willing to listen.

Mr. Zaid stated that the City has been very cooperative for the last nine months. They are working towards finalizing the long term license with Holiday Inn and they expect that to take place in the next 30 days. He would appreciate the City working with them to get this wrapped up. There are concerns about citations received in the last few days re: the condition of the property (covered in the Condition Report) and will be taken care of during the extensive renovation. He asked for City cooperation in the next 60-90 days as they finalize their preparations. Ald. McDermott asked if they could pay particular attention to the parking lot, making sure that it is as debris-free as possible. Neighbors in the area have complained.

Ald. Von Drasek asked whether the elevator issues have been addressed. Asst. Admin. Ms. Peterson stated that their elevator contractor contacted the City to say that they would begin work on Friday. Once work is completed, Thompson Elevators will do the inspection. When it passes inspection, the bond will be released. Mr. Zaid stated that a May 1 meeting is scheduled between Thompson and the elevator contractor for the final inspection. Atty. Peck stated that during tonight’s Council meeting during submission of bills, make a motion to release the bond subject to completion of the elevator repairs and final inspection. Ms. Paul stated that the Statement of Bills should be removed from the Consent Agenda.

Chair Ald. McDermott stated that there was previous discussion re: transferring the incentive to a future owner. He asked Atty. Peck to review that conversation. Atty. Peck stated that a request was made for the incentive to be transferable if for some reason they were to sell the hotel. In discussions had with all parties, it was pointed out that the incentive really is for the repairs and improvement of the facility. Mr. Peck suggested making the incentive transferable subject to the total completion of repairs and renovations and subject to approval by the City Council. The incentive agreement really pertains to the repairs and upgrades and once those are completed, it may not be an unreasonable request. Ald. McDermott agreed and sought member consensus; all agreed.

Ald. Pondelicek asked about the number of extensions granted thus far. Ms. Peterson stated the first amendment was approved in January and expired April 7; so one item lagging by a couple of weeks due to the elevator. Everything else has been completed and inspected by the Fire District and the Building Department.

Ald. Jasinski asked about the Star Report. Mr. Zaid stated that it is a third-party report re: hotel performance, occupancy and ADR – average daily rate. They review the metrics to gauge their standing compared to the market is and to their competition. Ald. Pondelicek asked if other hotels were down as well. Mr. Zaid stated they were not down substantially; they compete against hotels in areas like Burr Ridge and Oak Brook – a more thriving market. Countryside deals with the overflow business and they are at a competitive disadvantage. Because of the condition they are now seeing the negative effects of a business downturn.

Chair Ald. McDermott stated that Atty. Peck will redraft the agreement with the transferability issue addressed and the matter will appear on the May 13, 2015 City Council meeting agenda.

Adjournment

There being no further business to discuss, Ald. Pondelicek moved to adjourn the meeting, seconded by Ald. Jasinski and carried by unanimous Roll Call vote.

Chairman McDermott declared the meeting adjourned at 6:43 p.m.

Dated: ALD. SCOTT MUSILLAMI, CHAIRMAN

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