Water Street development gains approval for tax incentive

Please note this article had been revised in an attempt to accurately reflect the passing of a tax incentive, as opposed to the TIF (Tax Increment Financing) that was originally passed in 2007.

Marquette Companies, developers of the Water Street District, went before the Naperville City Council Tuesday night to gain approval for a $7.5 tax incentive.  And they did.

In a 7-2 vote, the proposed $7.5 million rebate passed and the funds will be distributed from the hotel/motel tax after being collected from the city for up to a twenty year period.

The $85 million development has already gone through several revisions, including scaling back the height and density.  The Council approved the site plan in early March. 

The original proposed development would have stood 89 feet tall, but has been revised after public feedback to stand 69 feet tall.  The project will include a 166-room hotel; 71,000 square feet of retail, restaurant and office use within the hotel buildings; 26,000 square feet within an office building; and a 524-space parking deck.

Downtown Naperville and taxpayers are subject to gain a parking deck and a 277 percent return on investment (ROI) according to Marquette projections from a 2011 impact study. They also presented an overall five percent increase in overall downtown sales tax and food and beverage tax revenues through 2034.  The parking garage has a net advantage at $22,000 per space as opposed to a $28,000 per space if developed otherwise.

Watch the Marquette presentation and Council debate in the video below.

Some of the projections and ROI numbers were met with skepticism at the public forum and a couple Councilmen agreed. Many details in regards to the financing of the development were presented a week in advance of the Tuesday meeting, not allowing for detailed analysis, they said.  Other reoccurring concerns have been the “Disneyfication of the Riverwalk” – there are currently  no businesses or restaurants  directly on the Riverwalk which has always been in the public domain.

The Water Street District was approved as a TIF district in 2007 and the Council also has approved similar tax incentives in recent years to area hotels including the Naperville Marriott at the east end of Diehl Road and Hotel Arista at CityGate Centre to the west.

To view the Water Street plans, visit www.positivelynaperville.com/water-street-plans.

Editor’s Note: A variety of earlier posts and photos  featured on this website during this proposed process can be found by searching “Water Street District.”

Update on April 19, 2013: In response to press inquiries, publicist Deb Newman said, “Marquette Companies has announced that it plans to begin construction on the Water Street District in Downtown Naperville by the fourth quarter of 2013 or early in 2014. The company will be providing updates on regular basis via media alerts, e-blasts and posts on www.waterstreetcommunityinfo.com, while working with the City staff, neighbors and the Downtown Naperville Alliance to keep merchants and the community aware of developments as the project progresses.” Direct media questions to Newman at (630) 846-4759.