GARY | Prominent Chicago real estate developer Elzie Higginbottom moved one step closer Monday to staking out a major presence at Gary/Chicago International Airport.
Higginbottom listened intently Monday morning as the Gary/Chicago International Airport Authority approved terms that could lead to his company providing business jet services in a new hangar and making an initial $3 million investment.
"I'm very pleased with the confidence the authority is showing in us to move forward with this project," Higginbottom said as he departed the meeting. "And I look forward to working with the authority as well as the Gary Jet Center to bring more traffic to the airport."
The Gary Jet Center is currently the airport's only fixed-base operator, providing aircraft repair services, fueling planes and chartering aircraft.
Eastlake Management & Development Corp., where Higginbottom is CEO, hopes to enter the same business as the Jet Center at the airport. But until Monday, few specifics of its plans were known.
Eastlake Management & Development is a prominent Chicago area development firm, with projects ranging from high-rise luxury condominiums to rent-subsidized housing. Higginbottom also is a former chairman of the Cook County Housing Authority and was a top fundraiser for former Chicago Mayor Richard Daley.
Higginbottom did not go into any details of his plans on Monday. But airport consultant Al Stanley, of JClark Aviation, laid out some of the plan at the authority's regular meeting at the Airport Administration Building and gave more details later.
Stanley told the authority the deal being cut for Eastlake Management & Development is comparable to those for current airport tenants. Airport lawyer Patrick Lyp told the authority its approval Monday gives negotiators the go-ahead to negotiate a final lease agreement, which the authority will vote on at a subsequent meeting.
Eastlake Management & Development will pay a rate that works out to about $36,590 per year for two acres next to the Boeing Corp. hangar site, under terms laid out by Stanley for the authority.
Stanley said the company plans to build a 30,000-square-foot aircraft hangar at the site. The company would be given 90 days from the lease date's start to begin its advance work to get the hangar constructed, Stanley said. The lease for the site would extend for 20 years with options to renew for 15 more.
In addition, Eastlake Management & Development will lease a hangar currently occupied by Jet Select at a rate of $2,800 per month. The Jet Select lease runs out in June.
Eastlake Management & Development also will take over management of the airport's 60 hangars for small aircraft for at least the next 15 years as part of the deal. It will pay 80 percent of its gross receipts for those hangars to the airport authority, but never less than $91,000, Stanley said.
The airport authority also approved change orders for its $166 million expansion project on Monday.
It increased the contract for relocating an Indiana-American water main by $200,000, in order to minimize disruption to a contaminated site west of the main runway, according to Project Manager Scott Wheeler.
It approved a credit to be paid to the airport by the contractor for two railroad bridges built north of the airport in the amount of $275,323.
The airport has been letting contracts on a per unit basis, so if less work or materials end up being required on a job refunds are due. Conversely, change orders can be brought forward if more work or materials are needed.