Mayor: Financing Issues Delay Construction On Trail East Until Spring 2020
The start of construction on the Trail East project in Uptown Normal has been delayed from this fall to next spring because of financing issues, Mayor Chris Koos said Tuesday.
This is only the latest delay in the $30 million Bush Construction project. The initial plan was to begin construction of the five-story, mixed-use building in late spring 2019, with construction taking 14 months. Construction was then expected to begin in October 2019, but that didn’t happen. Koos said Tuesday that it will be spring before Bush begins work, though some demolition of the older buildings along Beaufort Street may start over the winter.
"By their own admission, they stumbled and got lax on that project."
“By their own admission, they stumbled and got lax on that project and they needed to finish up their private equity,” Koos said on WGLT’s Sound Ideas. “The person tasked with working the private equity side (at Bush) didn’t work it diligently. I know there’s been a change in the person (at Bush) doing that kind of work to finish up those pieces.”
Koos said he’s fairly confident the private equity piece will be finished in the next two to three weeks. Trail East, on the northeast arc of Uptown Circle, had been expected to open in 2020.
“They’re not pouring foundations in winter weather,” Koos said.
Bush has not said much publicly about the project’s status, despite it being partially financed using taxpayer money. The project is expected to qualify for over $8 million in tax increment financing (TIF) district incentives, plus sales tax rebates of up to $250,000. If the project does not generate the anticipated property values or retail sales, then the incentive to Bush would be reduced.
"We're about 15% of the equity stake in that project, right in the sweet spot of public-private partnerships," Koos told WGLT in January.
In a statement Tuesday, Bush did not directly address the financing issues.
"The contractor bidding process is complete, the project is on budget, and project buyout is now underway," the company said. "Bush Construction is currently wrapping up the final stages of securing equity investors."
Around 400 people will work inside Trail East once complete. Known tenants for Trail East include:
- First floor – R MarketPlace food hall
- Second floor – Afni
- Third floor – Farnsworth Group
- Fourth floor – ISU startup incubator space
- Fifth floor – Apartments
Bryce Henderson, Bush's vice president of project development, said 94.5% of the building is under lease or letter of intent.
Koos said the delay has apparently not scared away two of the major tenants.
“I won’t say they’re thrilled with that, but they’re OK with the process and still want to move forward," Koos said.
When asked about Bush’s transparency about the project’s status, Koos said the Town of Normal itself has been “frustrated by that as well.”
“We felt we weren’t getting the accurate information. We raised that issue, and things have changed,” he said.
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