Mundelein approves amended redevelopment deal, agrees to invest land and waived fees in Village Hall project

Mundelein trustees on March 24 voted unanimously to approve an amended and restated redevelopment agreement (RDA) and several companion measures to move forward with the redevelopment of the Village Hall site by Flannery & Collins Development.

The board approved a package that includes an RDA amendment, preliminary and final plats, a parking license, transfer/assumption and operating agreements, and ordinances authorizing tax-increment-financed (TIF) revenue notes to help close a financing gap for the 225-unit multifamily building, 17 townhouses and a reserved retail pad on the site.

The RDA amendment changes the structure of closing rather than requiring a traditional cash sale. "In lieu of receiving cash at closing, the village is really investing this vacant property into the project," said Matt Norton, special counsel on real estate development and incentives, adding that the village's capital contribution — land plus waived impact fees — totals about $2,100,000. "The village gets to be a member of the LLC that will own and develop this project. . . . As a special member, it gets paid back first." Norton said distributions to the village must occur no later than the earlier of project stabilization and five years.

Why it matters: staff and the village's financial consultant told trustees the project, which sits inside TIF District 33, faces a financing gap driven by industry cost escalation since the original 2023 approvals. The consultant projects the site's taxable value would increase substantially if the project is completed; staff said the development would raise the EAV from effectively zero (the village-owned parcel) to nearly $12 million.

Trustees and staff framed the package as a time-sensitive opportunity. Colleen Malik, a village staff member who presented the project background, said Flannery & Collins is prepared to start immediately upon closing, and that delaying or replacing the developer could jeopardize the TIF district's remaining term and reduce the quality of any replacement proposal.

Board action: Trustee Wilson moved and the board passed the ordinance approving and authorizing the amended and restated redevelopment agreement; subsequent roll-call votes approved the related plats, transfer and parking agreements, TIF note ordinances, and the LLC operating agreement. The roll calls recorded unanimous "yes" votes from trustees present.

What the village receives and the risk controls: under the amendment the village becomes a special member of the project LLC and is entitled to receive the first distributions until its capital contribution is repaid. The LLC's repayment obligation is supported by a guarantee from an affiliated company of the developer, and staff said closing costs were adjusted so the village bears less cash outlay at closing.

Trustees, staff and developer representatives emphasized the many years of negotiation to reach this point. Julie Kellyer, identified as the developer's vice president of development, and other Flannery & Collins representatives attended the meeting and were thanked by trustees for their long-term commitment to completing the Village Hall area.

Next steps: the village will execute the amended RDA and related closing documents and proceed with construction steps tied to the plat and site plan approvals. Staff said final closing and construction scheduling follow standard contract timelines and lender conditions.