CALUMET CITY | The operators of the River Oaks West shopping center say they are pleased that the facility southwest of Torrence Avenue and River Oaks Drive is filled nearly to capacity.
But they also used a special City Council meeting Tuesday to explain that in many cases they have to offer discounted rent in order to keep retailers in the center, which is across the street from the River Oaks Shopping Center, and that even then retailers continue to come and go.
Rob Nadler, a regional president for Kimco Realty Inc., told aldermen the company is doing everything it can to keep River Oaks West as an economically viable shopping center. However, he acknowledged it is not likely Kimco will recoup the $11 million it invested in the facility in the early 2000s to upgrade it.
“We never would have invested the $11 million if we had known what the economy would be like,” Nadler said. “We’re not placing blame. We’re just stating a fact.”
When Kimco decided to pay for a remodeling of River Oaks West, company officials negotiated an agreement with Calumet City by which the city’s portion of sales tax revenue would be shared with the developer.
That agreement has paid about $140,000 per year to Kimco, Nadler said. Payments are made four times a year.
Aldermen expressed concerns about what they said seems like a flow of stores coming and going from the shopping center, including most prominently an Old Navy franchise.
But Nadler said the fact that replacement businesses are found is a good sign. He also said that in the case of Old Navy, his company gave the retailer a rent discount that kept it in Calumet City two years longer than it otherwise would have stayed.
“There’s nothing anyone could have done to keep Old Navy here,” Nadler said.
Mayor Michelle Markiewicz Qualkinbush said she thinks River Oaks West is better now than it was when she became mayor in 2003.
“When I came, River Oaks West was like a ghost town,” she said.
Nadler said bad news will come in the next few months — one of the major stores in River Oaks West will announce it is leaving. Nadler would not identify the retailer, but said his company is working to find a replacement.
Nadler said the troubles confronting River Oaks West are the same that affect retail throughout the Chicago area. He said he thinks city officials should be more concerned about the loss of Sears and Carson, Pirie, Scott stores in River Oaks mall than what is happening in River Oaks West.
He also said Cook County property taxes are an obstacle that all area businesses have to deal with.
First Ward Alderman Eric Schneider was sympathetic, citing Calumet City’s proximity to lower tax rates in Indiana.
“There are major malls in Orland (Park) and Merrillville, and we happen to be in the middle,” he said. “And worse yet, the tax line is right there,” he added, motioning out a window to the state line two blocks east of City Hall.