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DeKalb City Council considers making way for ATI Physical Therapy

November 28, 2016 GMT

DeKALB – City Council members are set to decide today whether to make some changes that would allow a national chain of rehabilitation clinics to open in a new building on Sycamore Road and could brighten up another shopping center.

ATI Physical Therapy, which operates rehab clinics in 19 states, has signed a lease agreement for 2,600 square feet of the newly constructed and vacant 8,015-square-foot building at 2115 Sycamore Road, officials have said.

Before ATI can move in, however, aldermen must agree to change the annexation agreement for property that includes the vacant building to allow for more nonretail uses. It’s a change that city staff advised against, but one the city’s Planning and Zoning Commission recommended in October.

“Staff … noted that ATI perhaps could be located very well in another location,” DeKalb Community Development Director Jo Ellen Charlton said at a public hearing on the proposal earlier this month. “The applicant indicated that they had those negotiations with ATI, and this is the site they wanted. They are pursuing this option to see what the City Council will allow.”

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Council members earlier this year agreed to annex the property, where a long-abandoned veterinary office had long been an eyesore. There are two buildings on the 2-acre site, and the council has made it a priority to reserve space in the retail corridor in hopes of maximizing the amount of sales tax revenue it can reap.

One of the buildings, at 3,250 square feet, already is occupied by Aspen Dental, 2061 Sycamore Road. If ATI Physical Therapy were to move in, about half the property would be occupied by nonretail users, city documents show.

To entice the council to change the terms of an agreement negotiated less than a year ago, Rockford-based developer First Midwest Group is offering to make some upgrades at another property.

If the council agrees to allow ATI to move into the new building, First Midwest said it will make several upgrades at the DeKalb Shopping Center, 1612-1718 Sycamore Road, a largely vacant retail center with vacant spaces once occupied by retailers Big Lots and Jo Ann Fabrics. Fitworkz health club is a current tenant there.

In 2008, the developer received up to $100,000 in tax increment financing assistance to perform property maintenance including façade improvements, flooring and new heating, air conditioning and electrical systems.

The loan was to be repaid with the sales tax proceeds the center generated, and the developer also was going to build a new building that would draw a new business to town, but neither of those things has happened, city attorney Dean Frieders said.

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Now First Midwest pledges that if the council agrees to clear the way for ATI to move into the new building, it will repave, restripe and reconfigure the parking lot at the DeKalb Shopping Center and replace the lighting and make landscaping upgrades to make the property more appealing to a national retailer. The work would have to be completed by July, Charlton said.

Council members considered waiving a second reading of the proposed change to the annexation agreement for the property at their Nov. 14 meeting. Although five of eight council members voted to do so, such motions require six of eight yes votes to pass.

The council could give final approval today to the change that would allow ATI to move into the building, and they could begin the process soon after, she said.

“They’re pretty much ready to pick up their permits the next day and start working,” Charlton said. “They’ve already been through their building review.”