By Ashley Rueff, Chicago Tribune reporter
4:32 PM EST, January 25, 2013
A major luxury apartment complex meant to be a catalyst for Orland Park's new urban-inspired downtown area is only a few months away from opening its doors to residents.
The developer of Ninty7Fifty On the Park is on schedule to finish 80 of its 295 units and about 11,000-square-feet of communal space — like a screening room and computer lounge — by late March, said Chris Kirles, vice president of development with Indianapolis-based Flaherty & Collins Properties.
The six-story project is the first major piece of a massive retrofitting of a downtown district for Orland Park near 143rd Street and La Grange Road. The major development hasn't been without controversy, however, and village officials who agreed to help finance the public-private project have a lot riding on its success.
An agreement including a $38 million loan from the village and up to another $25 million in financial incentives was approved despite many outspoken residents who were against it. Skeptics said they doubted the viability of a nearly 300-unit apartment complex in the southwest suburbs with rent starting at about $1,300 a month.
While it is still early, officials are saying the outlook is promising and they're excited by interest from potential tenants. As of mid-January, Kirles said 31 people have pre-leased units and, on average, the per-square-foot rent rates are coming in strong.
"Interest is picking up exponentially," Kirles said.
In February, a finished one-bedroom model unit inside the complex will be ready to show potential renters, a step both Kirles and Orland Park Mayor Dan McLaughlin said they expect to create a jump in lease signing.
Huge 'Now Leasing' banners have been hung at the construction site, and Kirles said a marketing push launched via social media a few weeks ago has attracted a lot of attention.
The tenants who have already signed leases include many young professionals to empty nesters, Kirles said, which are the two main demographics expected to have interest in the site.
"We have some people that live downtown, and they want to live in the suburbs," he said.
The apartment complex is the first major part of a larger vision for a transit-oriented district inside what's been dubbed the Main Street Triangle by officials. Their plan is to assemble restaurants, shops, business offices, entertainment venues and a variety of housing options all within walking distance of the 143rd Street Metra stop.
The goal is to create a setting where suburban residents could cut back their reliance on cars. Kirles said they are also working to get Zipcar, a car sharing service, to station vehicles at Ninety7Fifty for residents.
"In a suburban environment, there's really nothing like it," he said.
The goal of the extra amenities like communal lounge areas on the first floor and a gaming room is to create a sense of community for residents. An independent coffee shop has also signed on to fill a portion of the 4,000-square-feet of retail space on the first floor, and other retail space is still available.
Of the about 30 committed residents, Kirles said not all of them will be moving in when the first wave of apartment units are finished in late March because some are interested in units that are still being constructed.
About 25 percent of the 295 units should be finished by late March. The others should be finished in phases after that, with total completion expected in late summer.
The model unit is about 750 square feet and is priced at about $1,325 a month, Kirles said. It has shiny, granite countertops and a wine rack already mounted in the kitchen. There's a parking space included, washer and dryer in the unit and a sliding door opens onto the complex's sun deck and pool.
The units are mostly one and two bedrooms, but a handful of two-story units include a den, or a third bedroom, Kirles said. Those 1,500-square-feet duplexes are priced on the Ninety7Fifty website at about $2,400 a month. Concerns by residents about the village's financial ties to the project stems from doubts that enough renters will be willing to pay rates that rival many mortgage payments.
If the developer fails to fill the building at its expected rates, then ultimately it will be tax dollars on the line to cover the village's commitment. Officials say their market studies showed a strong demand for the luxury rentals, and their financial deal comes with enough checks and balances to protect taxpayers.
"When this is up and running, I think everybody will be very proud of it," McLaughlin said. "Very happy with it."
John Fotopoulos, an Orland Park resident who is running for village trustee in the April election, said he was motivated to run in part because of his dissatisfaction with the village's handling of the apartment project.
"I'm not a proponent at all of using public funds for private development," he said, adding that he thinks the first development in the new downtown area should be commercial-based and not residential.
To cover its $63 million commitment, the village issued $20 million in taxable General Obligation bonds in 2012, and likely will issue another set around April, said Finance Director Annmarie Mampe.
A combination of village revenues from the project will go to cover the debt service on the borrowed cash. Original estimates said that 10 years into the project, rent rates would need to average about $1.90 per-square-foot for the village to break even. Mampe said so far, the units are renting at an average of about $1.60 per square foot.
"Two dollars (per-square-foot), 10 years from now, seems pretty easy," she said.
If rent continues to climb, then it's possible the village would even make money on the deal. But if the units aren't rented as expected, officials said the home rule sales tax dollars would ultimately be used to pay the debt service on the bonds.
Village officials say they did their due diligence to map a financial plan that protects the village's investment, and even though it's early, so far they say the numbers look good.
"We're encouraged and we're very optimistic," said Village Manager Paul Grimes. "Everything so far is going in accordance with the plan. We're confident."