Developer Plans Luxury Apartments In Former State Farm Building
UPDATED 12:30 p.m. | State Farm announced Friday it's found another interested buyer for its downtown Bloomington building, potentially saving it from demolition.
The Bloomington-based insurer said the new interested buyer is Urban Equity Properties LLC. The Rockford-based company confirmed it has signed a purchasing agreement with the insurer and plans to close the deal in early October.
UEP’s Founding Principal Justin Fern said the company is planning a $40 million project to convert the building into 230 luxury apartments. He said the company hasn’t decided what will be done with the first floor.
“All of our projects typically involve fitness centers, tenant lounges, communal space and this particular one even a café and a restaurant will likely be on the ground floor as well,” Fern said.
Fern added the company plans to take advantage of state and federal incentives, including rehabilitation tax credits that can be used to renovate properties listed on the National Register for Historic Places. He said the firm will likely seek some financial incentives from the city, but not sure what that might entail at this point.
“We haven’t really gone down that road yet. Obviously, we are still early in the deal,” Fern said.
Fern said he believes the Bloomington-Normal market, which includes large employers such as State Farm and three colleges and universities, will be able to keep those apartments full.
“We really enjoyed what we saw,” he said. ‘We think we can really add to what’s already been added downtown but in a big way. We really believe this project will energize the downtown like it’s never seen.”
Urban Equity Properties specializes in renovating buildings of historic and architectural significance, according to its website. The company lists 12 apartment complexes on its website; 10 of them are in Rockford and two are in Aurora.
Fern said the building is a perfect fit for his company.
“At the end of the day, (State Farm) really wanted to see this building saved and they wanted to see the community aspect really number one, even in front of financial returns,” he said.
State Farm said Urban Equity Properties "has a demonstrated track record of redeveloping older buildings in the urban core of similarly sized cities."
State Farm has been trying to find a buyer for its former headquarters since spring 2018. One previous buyer fell through for unknown reasons, and in July demolition plans were announced. That led to the formation of a community group called Save Our State Farm Building.
"Our preferred option has always been to find a buyer for the Downtown Building, and we are pleased UEP came forward with an effective plan to redevelop the building," State Farm said in a statement. "Once the sale is finalized, State Farm will cease plans to demolish the Downtown Building."
A spokesman for the Save Our State Farm building group, McLean County historian Greg Koos, said the group's biggest impact was showing broad community support for saving the building.
"State Farm was perhaps surprised at the level of interest. Sometimes, when you are on the inside, it's hard to see yourself from the outside," Koos said.
The group had previously warned of a $252,000 annual property tax hit to McLean County taxing bodies if the building were to be demolished, hurting District 87 schools the most.
"That's three teacher salaries that are funded," Koos said, referring to the $155,000 in property taxes that goes to the distrct. "This is good for everybody."
Koos said the group wasn't directly involved in talks with the prospective buyer, but it appears publicity efforts by Landmarks Illinois, a preservation group which had representation on the panel, likely caught Urban Equity's attention.
Fern said he doesn’t foresee any stumbling blocks that would keep this project from happening.
“The sale will close, OK, and we will get it figured out whatever it may be later,” Fern declared.
The building served as State Farm’s headquarters until 1974 and was once home to 400 to 500 employees. The last batch of employees were relocated out of the building last year, when State Farm put it up for sale. The “State Farm Insurance” signage came down last fall.
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