ROCHELLE — City officials expect the demolition of the Hickory Grove facility at 1127 N. 7th St. that’s slated to start in late January to go “very quickly,” City Manager Jeff Fiegenschuh said on Dec. 15.
McDonagh Demolition is contracted to do the work for $361,900. The project will be funded by a Illinois Department of Commerce and Economic Opportunity Rebuild Illinois grant reimbursement up to $365,750. The seven other bids the city rejected ranged from $542,000 to $978,000. The accepted bid was approximately 35 percent lower than the city’s engineering firm’s estimated cost of $575,000.
"I was very nervous when the bids came in, but [City Engineer Sam Tesreau] and our engineers met with them and they feel confident that they're going to meet those dollar amounts and that's why I think the project is going to go very quickly because they're going to need to get in here and get that stuff done,” Fiegenschuh said. “It felt very good to see that bid. Especially with the opportunity where the grant could potentially cover all of it.”
Fiegenschuh acknowledged that there could be issues that arise that could result in change orders and higher costs for the demolition. He was pleasantly surprised by the bid amount.
“All of our other projects, with the way things are in the economy right now, it's no longer, 'Wow, we can go to council and say it came in under engineer's estimates,’” Fiegenschuh said. “Now it's asking how much it's going to be over the estimate. When this came in, I was taken aback. In a good way."
City officials expect the demolition to be completed in April. The nearly two-year process since the city acquired the building has seen delays and easement agreements with the hotel next door for proper separation of the buildings. It also had to wait due to grant finalization.
The city assumed ownership of the deteriorating building in early 2020 for $1 with the intention of demolishing it and developing the property. The building was previously owned by the Ogle County Civic Center Authority (OCCCA) board, which was under the Ogle County Board umbrella. The city decided to purchase the site so it could control it and likely would’ve had to deal with it later if it was abandoned due to OCCCA being in financial trouble.
"Approving the demolition felt euphoric,” Fiegenschuh said. “People tend to look from the outside in and ask why things aren't getting done. They don't know all the work people are doing on the back side to get a project to where it's ready for our mayor and city council to approve. It felt good because I have a very capable and great team.”
The “pieced together” building has yielded surprises in the past such as easement and utility complications, which could make for possible issues once it starts to be demolished.
“When you find those things and fix them, you start thinking, 'What else are we going to find in there that's behind the walls or wherever?'” Fiegenschuh said. “If something happens, we'll deal with it. We've been dealing with it for the last two years and we'll deal with it again."
Fiegenschuh anticipates that if all goes to plan, the city could have the site completely cleared off and prepped for some kind of development in April or May. The city plans on issuing a request for information in order to seek developers interested in the site. Proposals would then be taken to the mayor and city council for approval.
With demolition given the green light earlier this month, Fiegenschuh said developers have reached out to him recently and interest has kicked back up.
“I've been approached,” Fiegenschuh said. “For some mixed-use projects. Some retail and higher-density residential. It's ultimately up to the mayor and council. It's their property. The city owns it and they're in charge of the city. We had some retail interest as well. That's why we want to do the RFI. We want to see all of the proposals and ultimately let the mayor and council determine what they think is the best fit on that highly-visible spot for the next 20-40 years."
The prospect of the property being purchased and developed in the future would not only benefit the city by it coming onto the tax rolls. The city also set up a tax increment financing (TIF) district for the site with future development in mind.
Once a developer comes in and develops the site, 100 percent of their tax bill goes into that TIF and back to the city.
“It could be used to help incentivize a project to close that funding gap if there is one,” Fiegenschuh said. “It could and will be used in part to help reimburse us for any costs associated with the acquisition, demolition and site preparation and restoration. I think there's a lot of possibilities there.”