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05/13/2013DES PLAINES ILLINOIS Minutes of Meeting Economic Development Commission May 13, 2013 CaII to order: City of Des Plaines Office of the Mayor 1420 Miner Street Des Plaines, IL 60016 Tel: 847-391-5301 Fax: 847-391-5378 Chairman Ulett called the meeting to order at 7:36 A.M. on Monday for a special case meeting, May 13, 2013, in Des Plaines City Hall 1420 Miner Street/Northwest Hwy, Room 101. Approval of Minutes: April 25, 2013 meeting A Motion was made by Malcolm Chester to approve the meeting minutes for April 25, 2013. The Motion was seconded by Jin Lee. Motion passed by unanimous voice vote. MOTION CARRIED Members Present: Jim Ulett, Richard Grosse, Malcolm Chester, , Jin Lee, Christen Osowski, Cortney Anderson, Patrick Devaraux, Dick Sayad, Barbara Ryan, City Staff/Officials: Matthew Bogusz, Patricia Haugeberg, Chan Yu, Alex Dambach Members Absent: Also Present: Scott Ward and Mark Zych, Owners of Tap House Grill, Jennifer Tammen, Owner of The Tammen Group, Andrew Becker and Peter Caruso, represent MidAmerica Landlord out Austin, Texas Old Business: a. none New Business: a. New Restaurant business project for Market Square location. Director of Community Development Alex Dambach gives an overview of the new businesses that are in project at Metropolitan Square, that being a gym and a restaurant. The gym has already started remodeling. The new applicant for Metropolitan Square is Tap House Grill restaurant. The Owners are currently opening their 8th location and would like to have the 9t' in Des Plaines. They would like to open in time for football season. Negotiation has been finalized with the management company for Metropolitan Square and will take over the 6,000 square foot plus space that was formerly occupied by Cheese Burger Paradise restaurant. With this new business, Metropolitan Square will make a comeback and bring the occupants load up to about 40%, which is what it used to be. Alex introduces the Owners of the Tap House Grill restaurant, Scott and Mark; they gave an introduction of themselves and their business model. Scott and Mark passed out menus from their existing restaurants. They gave a brief history of their back ground in restaurant experience and personal development in their careers. They mentioned that they were interested in the location at Metropolitan Square with incentives provided by the City of Des Plaines. EDC Chairman James Ulett asks if there were any questions for Scott and Mark. Patrick Devereaux asked if they have an exit strategy plan. Scott's reply was that they always dol 0 year leases and have a stable gross strategy by opening 1-2 units a year. Barbara Ryan asked if all their locations are doing well. Scott replied, unbelievably. Economic down tum, last year they were up 16.1%, the year before that they were up 12%, and the year before that they were up 10%. They are involved with the communities that they are established in. A Committee member commented, your architect said this is a good location for you, and asked why he feels that way? Scott replied he thinks there is a desperate need in this town for a mid -scale restaurant and that the economics is getting better and that all the restaurant necessities are available in the location. Barbara Ryan asked how long of a lease are they looking to sign? Scott answered a 10 year or a 2-5 year lease, and then Mark mentioned 20 years. A Committee member asked, what are your hours? Scott answered, Monday through Thursday 11 am to 1 am, Friday and Saturday 11 am to 2am, and Sunday 11 am to midnight. Jin Lee commented, job creation and retention is critical for our City of Des Plaines and he would like to see a solid business come in. Regarding job forecast of 10 permanent jobs and 25 part-time jobs, how does that work in a business with a 6,000 square feet restaurant? Can you accommodate more or less? Scott's reply was that they are projecting about a million eight in sales and based on those revenues and other models they have, that's typically 10 full time employees and 25-35 new employees. Payroll is half a million to 550 a year that puts it around 28% give or take. Their labor force 70% to 80% will come from local community. Jin Lee asked will they hire right away. Scott said, yes they are they looking to hire managers now. James Ulett clarified the terms of the lease and confirmed they will be long term residency in Des Plaines. Mayor Matthew Bogusz asked where have you found your calling for your resources. Scott answered 80% is locally driven. Mayor Matthew Bogusz asked, if they had a rough idea in their first year what they will invest in advertising? Mark said 4% will be invested. A lot of their time is spent in the community like street festivals. They do a door to door program approach. They don't do radio, TV or billboards. They would like to open by mid-September. City Manager Michael Bartholomew reviews bullet points on the application: 1. A restaurant location that needs to be filled 2. The Landlord is putting in 300,000 in capital 3. The Tenant is putting in 322,000 in capital improvements 4. The City of Des Plaines was asked for 80,000 in capital improvement 5. Long term lease, 10 year with a 2-5 year option 6. Apply the 5 year claw back clause Richard Grosse asked is each restaurant an independent LLC? Scott replied, yes. He then asked if the restaurant fails, will the claw back really do the City any good if they go bankrupt? Scott reply's that he personally will sign for the agreement that will be drafted by attorneys. Barbara Ryan asked will this location become a franchise? Scott answers, No. Alderman Patricia Haugeberg commented on the demographics and the benefits of having a restaurant in the condominium area of Metropolitan Square. Jin Lee is reiterating that the Tap House Grill is asking for 80,000 from the City. Half of TIF incentive is 40,000 and the other 40,000 is the City Business Assistance Program Funding. Do we have the monies put away? Alex replies all of it is coming out of the TIF account. Scott said they will apply the monies for the TIF requirements. Jin Lee stated that he hopes that they can look into companies in the City of Des Plaines for construction of the redevelopment like contractors, sign companies, advertising companies and so forth. Scott replied they do their own printing and a lot of the business with the locals. Malcolm Chester asked if they will have their manager heavily involved in the community? Scott replied that their general manager is their ambassador. James Ulett asked, if there were any more questions? Mayor Matthew Bogusz wants to insure that all funding is not going to be exhausted for the next business that wants to invest. Andrew Becker and Peter Caruso introduced themselves as representative's landlords of Austin, Texas. They are with Mid America who handles the lease on behalf of worldwide. A Motion was made by Jin Lee to approve the support for the City Council. The Motion was seconded by Richard Grosse. Motion passed by unanimous voice vote. MOTION CARRIED b. Review of Committees James Ulett visited the oldest business JB Metal Work and the newest business American Eagle in town with Mayor Bogusz and the City Manager. Members in Marketing Committee: Jin Lee, Malcolm Chester James mentioned that there is an opening in the Marketing Committee and needs to be addressed. Members in Business Retention Committee: Courtney Anderson Washer, Barbara Ryan, Christen Osowski, and Patrick Devereaux Members in Incentive Committee: Richard Grosse, Rapp, and Coheart James Ulett said Jan will get a list of all the businesses in Des Plaines and that we need to come up with a game plan to visit businesses for business retention. Alex commented that he is excited to get the business retention on its way and would like to set up guide lines by the next meeting. Barbara Ryan pointed out that if visiting two businesses a month and there are over 3,000 businesses in Des Plaines, How Tong would it take? James Ulett suggested leaving it up to the Business Retention Committee to coordinate the visits with the businesses. Barbara Ryan stated she would like a follow through when businesses are visited and request assistance from the City. James Ulett suggested that after visiting the businesses, bring it up for the meetings and have a report on every business, bullet points on the table, they will be recorded, have staff present, and make sure that it's executed. Alex suggested setting up a kick off meeting for each of the committees. He will need to call for meetings more often. James Ulett mentioned they have entered into agreement with a group called The Tammen Group. The Tammen Group is to assist in the economic development in research and help us along with business retention. The Tammen Group was approved by City Council last week. Jennifer Tammen introduced herself and her company, The Tammen Group. She gave an overview of how her company can help with Community Development and retention with the City. She mentioned that Alex and she will meet afterwards to move on with putting a contract together, put a steering committee together, and work with resources that already exist and maximize them. Alex wants the Marketing Committee to meet so they can schedule a meeting to discuss things like printing materials and things of that nature. Jin Lee mentioned about the Marketing Committee and wanted to add to start the business educational workshop and to coordinate once a month free business workshops. Alex can ask the inspectors, because the inspections for the businesses have ongoing issues and concerns. He suggested maybe to have annual workshops as well. James Ulett asked if there were any other comments on the committees. Richard Grosse asked when are other committees going to start? Alex replied, after the kick off meeting with Jennifer Tammen, he wants to call the Incentive Committee for a meeting particularly with Jennifer to discuss an overall incentive philosophy, approach, strategy. He will set up a meeting for all three committees. His goal is that the meeting will happen by the end of next week. James Ulett asked if there were any other comments for the commissions? Barbara Ryan asked when will Tap House Grill go before Council? Alex answered June 3"d• he hopes. Alex mentioned that World Class will be present for Council meeting. James Ulett commented that other tenants in the Metropolitan Square are very excited that Tap House Grill restaurant is coming in because they understand it will benefit their businesses. Barbara Ryan asked will there be a letter to Council regarding the commission's support? James Ulett passed an example letter that would be sent to the Mayor and City Council stating if the commission Is in favor or not in favor. James Ulett mentioned last point of information is there is two possible new members for the EDC and that fetters will go out to the Mayor. Associate Planner Chan and I have reviewed membership roster. He noted that they are three members short and is asking if there are any business associates that they can recommend to bring to full staff. James Ulett asked if there were any other comments. There were none. Meeting was adjoumed by Chairman Ulett at 8:46 A.M. Respectfully submitted, Galaxia Hernandez, Recording Secretary � ---- / ifsec. "erle P/.w44. Appro d on Sept Z y , 2013, by: Cri--- — James Ulett, Chairman 1