Aurora officials preview three downtown redevelopment projects totaling 88 apartments and TIF support

City of Aurora officials and private developers on Feb. 4 outlined three proposed redevelopment agreements that together would convert underused historic and commercial buildings in and near downtown Aurora into 88 residential units.

The projects discussed were the Aurora National Bank building (Floors 4–8 to be converted to about 30 apartments), the Franz Building (about 10 units plus restaurant space) and a warehouse-district conversion at 251 South River Street (about 48 units). David Debo, the city’s director of economic development, and Marty Lyons, a part-time consultant and former city chief financial officer, led the presentation with developers from JH/James Real Estate Partners and the contract purchaser for 251 South River.

City staff and the developers said the downtown rental market is tight and rents have risen sharply since 2019, but construction and other costs also rose, leaving a financing gap the developers say requires city incentives. The proposals rely on a mix of pay-as-you-go TIFs, historic tax credits, developer equity and a loan from the city’s recently formed “transformation fund.” None of the deals would use forgivable grants, according to staff.

Why it matters: Council members said the conversions would activate historic buildings, expand downtown housing supply and support nearby businesses. The projects are intended to advance an administration goal of turning vacant or underused historic buildings into occupied residential and commercial properties, which staff say helps downtown viability and reduces long-term blight.

What staff presented • Aurora National Bank building (agenda item 25-0090): The proposal would convert floors 4–8 to residential while keeping the basement through third floor commercial. Staff said the developer requests use of an existing TIF (TIF 10) and a pay-as-you-go approach to capture the anticipated annual tax increment that results from higher assessed value after redevelopment. The presentation described an expected increase in the building’s tax bill (staff projected an approximate $100,000 annual tax bill after redevelopment) and a plan to use the increment to repay roughly $2,000,000 to the city’s transformation fund. The developer requested 100% of the increment in the near term; staff proposed a sharing formula that withholds 10%–20% of the increment for taxing bodies if students materialize from the new housing (10% retained if 1–5 students; 20% if 6–10 students). Staff said the school-district reporting requirement will be part of the RDA so the district and developer must report student counts annually.

• Franz Building (agenda item 25-0092): That project covers two address parcels, including a vacant lot. The developer proposes about $5.5 million in total costs, including roughly $560,000 in restaurant build-out allowances for a future tenant. Staff said the developer would receive a small pay-as-you-go TIF and, like the bank building, the agreement contains a student-based revenue-sharing clause (10% of increment if 1 child; 20% if 2 or more). Staff noted developer equity and deferred fees are substantial parts of the pro forma and that developers are deferring a portion of their fees for multiple years to improve deal viability.

• 251 South River Street (agenda item 25-0093): The warehouse-district conversion would create about 48 units. The developer does not yet own the site but has the property under contract conditioned on reaching an RDA and closing the developer’s financing (including historic tax credit commitments). For this deal staff proposed $2,000,000 of upfront support from the transformation fund as a loan to be repaid from the TIF; staff described a 20-year repayment schedule at roughly 2.5% and a deficiency-payment clause that holds the developer responsible if actual assessed taxes fall short of the pro forma. Staff and the developer described scaled parking solutions (surface and on-street) rather than extensive below-grade parking to contain costs. The seller’s asking price and the land cost were discussed as factors that increased required public support.

Council discussion and concerns Several aldermen pressed on how much tax increment the school district would receive, with Alderman Guerrero (remarks made in his capacity as a council member) noting prior school-board interest in micro-TIF revenue-sharing. Council members emphasized that if no students live in the redevelopment units there is no direct school cost and therefore less immediate fiscal impact to school operations; staff reiterated the proposed student-count clawback to allocate some increment to taxing bodies when students appear.

Alderman Worman formally recused himself on agenda item 25-0093 because of a conflict; he left the chamber during discussion and staff recorded the recusal on the record.

Developers and staff also faced questions about deliverables and schedules: Alderman Mesiakos asked about missing exhibits and schematic drawings; the developers said schematic plans and timelines were being finalized and that planning, historic-preservation review and permitting would follow. Developers committed to provide schematic drawings and updated timelines to staff and council members before the next meeting.

Next steps and status No final council vote on the RDAs was recorded in the presented segment. Staff said the three items will be placed on the council’s unfinished agenda and returned for full council consideration (and likely removed from consent) at a future meeting; staff said they expect additional conversation next Tuesday. One project (251 South River) requires the developer to firm up purchase and financing commitments (including historic tax credit approvals) before construction can proceed.

Quotes • “These three projects equate to an additional 88 residential units for the downtown,” David Debo, director of economic development, said during the presentation. • “There are no forgivable loans being discussed tonight, and the incentives being discussed will either involve no upfront funding or a return of a percent of the money that is advanced,” Marty Lyons, consultant and former city CFO, told the council.

Ending City staff and developers framed the proposals as incremental steps in a longer downtown redevelopment strategy; members of the council asked for additional detail on exhibits, timelines and school-district revenue-sharing before final votes. The items were set for continued consideration rather than immediate adoption.