‘The density here is staggering’: Developer’s plan for 800 apartments downtown divides McHenry

A McHenry City Council meeting drew a packed house and lengthy debate over a developer’s plans to transform two parcels in the heart of town.

Discussion Monday evening – at times emotional – stretched nearly four hours on the two proposals by Geneva-based Shodeen Group LLC that call for about 800 apartments, a 130-room hotel, commercial spaces and parking downtown.

The properties in question are about 2¼ acres the city controls between Route 120/Elm Street and Green Street, as well as the former wastewater treatment site off Waukegan Road on the Fox River. McHenry also has agreed to purchase, has purchased or is in negotiation to buy other land adjacent to the two sites.

City leaders emphasized that the plans are only conceptual, and no vote was taken.

“None of this has been finalized,” City Administrator Suzanne Ostrovsky said. “None of it has been negotiated or discussed. This is our opportunity for us to get feedback from the city council on what they want downtown and whether Shodeen can provide that.”

Still, the addition of apartments, the density and height of the building and whether parking would be adequate were among concerns raised.

“You won’t get my vote with apartments, not in this area. We need to stay away from a developer that creates more need for parking until we solve the problem with parking we have right now,” said Alderman Andrew Glab, Ward 2.

Added 6th Ward Alderman Michael Koch: “What I care about is the parking. You’re cramming 10 pounds of snot into a 5-pound bag.”

Among numerous residents to speak at the meeting, John Cunat, owner of property management company Cunat Inc., said the developer didn’t meet the minimum number of parking spots for the size of the projects.

“The density here is staggering,” Cunat said.

John Smith, president of the McHenry Riverwalk Foundation, said the city should study downtown parking before moving ahead with any project.

“This just doesn’t jive,” he said. “It’s just overwhelming what we’re talking about as far as density and parking.”

‘Are we in the ballpark?’

Others questioned the city’s so-called “standstill” agreement with Shodeen. Approved in April 2023, it basically sets aside the two downtown parcels until March 2025 for development by Shodeen.

The proposals also call for city incentives in terms of tax increment financing, or TIF money. A TIF is a mechanism the city can use to steer property tax revenues generated within district boundaries to improvements in the area to help foster economic growth.

Concept plans for the Elm/Green Street properties include 303 apartments, 8,000 square feet of retail space and 422 parking spaces across three buildings. In total, the company is looking at a $98 million development on the site, which also includes use of the space that is home to Green Peapod Thai Restaurant. Shodeen also is looking at $20 million in incentives from a new tax increment financing district on the site.

At the former water treatment plant site, Shodeen is suggesting 496 apartments, 839 parking spaces and a 130-room boutique hotel across five buildings. The cost to develop that has been estimated at $190 million, with a $35 million TIF request.

With negotiations continuing, the earliest any building could begin is 2027, Shodeen President David Patzelt said.

“As a minimum, we’re trying to kind of get our arms around where are we at, or are we in a ballpark of where this project needs to be,” he said.

Several council members and numerous audience members voiced disapproval of any city-owned properties basically being given to the developer, and some questioned the amount of incentives proposed for Shodeen.

“I have no doubt we will see a developer that wants to be here and wants to give the city the chance to drive the train,” said resident Cynthia Locke. “I keep feeling like it’s backwards, like [Shodeen] is trying to tell you and educate you on what you want.”

But others stressed the need for new construction.

“I’m not saying I support everything this developer is looking to do,” said Jennifer Synek, a 25-year local resident and McHenry School District 15 board member. “There should be no shutdown of concepts. … You should be wanting this town to grow and people to come here. Why don’t we want people to come here to live and to shop and to support the small businesses?”

Resident Nathan Fenton urged city leaders to take a risk.

“Votes for stagnation will kill a town like ours,” he said. “I’m not saying this is the answer, but something like this has to happen if you want to move forward and not watch the town rot away.”

‘We need to make it beautiful’

Several council members expressed a willingness to move ahead with negotiations. Additional housing is needed in McHenry, said Alderwoman Sue Miller, Ward 7. Shodeen’s plans might need tweaking, but they’re headed in the right direction, she said.

“I think we need rental housing, whether it’s this concept or a similar concept. It fills a need we have missed forever,” Miller said. “We need additional housing. We need to make it beautiful.”

Of the former treatment plant land, Council members Victor Santi, Ward 1; Frank McClatchey, Ward 3; and Glab, as well as several residents of the area, questioned whether townhomes would be more appropriate than apartments.

“We are not against development, but what I see here tonight would be so destructive to our community,” said Tony Esposito, president of the Riverwalk Place Homeowners Association.

Neighboring residents expressed concern with increased traffic and questioned whether the street was built to handle it.

“We have in our possessions one of the most desirable pieces of real estate anywhere,” said Smith, the Riverwalk Foundation president. “We have to do something special with it, and it can’t be this. It can’t be apartments. That’s my opinion.”

The proposals represent an opportunity to attract younger generations, said Alderman Andy Davis, Ward 5.

“This may not be a perfect concept, but the idea is there,” Davis said. “We should at least talk about it and entertain it. To shut it down, you’re just closing a door and you may not have another opportunity.”

‘Let’s get the story straight’

McHenry Mayor Wayne Jett reminded the crowd that Shodeen was the only developer to respond when the city put out a request for proposals.

“I think the public is thinking that we’re looking to give them money,” he said. “This is a proposal.”

Later, he addressed a guest opinion written by city council member Chris Bassi, Ward 4, in the Northwest Herald. Bassi called the tax incentives proposed for Shodeen as a “gross misuse” of taxpayer money. Bassi wrote that the council only learned about an intended “multi-million dollar giveway of taxpayer purchased land” last week and that the deal was “hidden” in the proposal.

Jett asserted the piece was full of false information and that city council members have been involved in numerous conversations about the proposal and efforts to purchase land.

“Let’s get the story straight. I don’t care what people think of me, but I will tell the truth. … It’s just disheartening this information goes out that’s false,” he said.

He again stressed that Monday’s meeting was only a discussion, with no vote, and that he has never expressed full support of the proposals as they stand.

“I’m sick and tired of these council members trying to run the show,” he said.

The public review came about in party because of the city council’s recent rejection of another Shodeen proposal. On June 17, the city council in a 4-3 vote turned down a plan for 1111 N. Green St. that would have put 88 apartments, 157 shared parking spots and commercial space in a six-story development.

In support of that proposal, Jett publicly criticized that vote and said that he may have to reconsider his role as mayor if the city council is not interested in development.