Title/Name/Summary
Dick's Sporting Goods House of Sports - Term Sheet Approval
History
In March of 2025, the Village Board passed a Tax Increment Financing (TIF) district reimbursement resolution for the proposed Dick's House of Sports at the former Sears location. The resolution allows the Village to investigate establishing a TIF district to support the project and reimburse themselves and the developer for eligible expenses if a TIF district is created. The purpose of the resolution is to induce the redevelopment as it appears this could not occur without the adoption of TIF plan. The Village has been working with representatives from Dick's Sporting Goods to negotiate major deal terms to help facilitate the redevelopment of 2 Orland Square Drive (former Sears). The term sheet is a non-binding document that will serve as the basis for eventual redevelopment agreement.
A summary of the term sheet is provided below.
Project
Dick's Sporting Goods (DSG) intends to redevelop a portion of the Sears parcel with a Dick's House of Sport, consisting of approximately 90,495 square feet of retail and 28,566 square feet of non-sales uses. The non-sales uses will include some or all of the following: climbing wall, indoor batting cage, golf simulator, yoga classes, juice bar, running track, and an outdoor athletic field. The remaining lower level of the former Sears store will at some point be partially or fully occupied by a to-be-determined retail tenant.
Redevelopment Agreement
The Term Sheet provide a framework for the incentives that will be provided by the Village for the proposed redevelopment. The details of the terms will be further defined in a redevelopment agreement. Both the Village and DSG agree to use good faith efforts to negotiate and execute the redevelopment agreement on or before September 15, 2025.
Payment
The initial payment from the Village to DSG will be prior or simultaneous with the closing on the purchase of the Sears parcel from the current owner. The payment will be made as follows:
$6,000,000 for the acquisition of the Sears Parcel;
-Up to $800,000 as reimbursement for acquisition-related, development-related and incentive related costs including but not limited to: costs of closing, building shell and construction, exterior improvements, interior renovation, predevelopment, development, design and new construction, professional services, development fees, and marketing and promotional efforts.
-The Village will deposit the initial payment into an escrow pursuant to an escrow agreement, to be established in the future.
-The Village will take all necessary steps to fund the initial payment using potential funding sources available to the Village, including but not limited to general funds, bond proceeds, or other Village controlled sources.
-The Village will fund the initial payment by no later than January 31, 2026.
-The Village will make subsequent payments to DSG from the escrow to reimburse DSG for additional TIF-Eligible costs.
Conditions - The funds will be provided to DSG provided the following conditions:
DSG must open to the public a Dick's House of Sport retail sporting goods store, containing no less than 90,495 square feet of retail sales floor area including some or all of the following climbing wall, indoor batting cage, golf simulator, yoga classes, juice bar, running track, and an outdoor athletic field.
DSG will commence construction by May of 2027
DSG will open in the spring of 2029
The redevelopment agreement shall not contain the following:
-Minimum expenditure to construct the House of Sport
-Minimum number of construction or permanent jobs created and/or maintained
-Limitation on the ability to challenge Cook County property tax assessments or appeal property taxes, except that if, as a result of such challenge or appeal by DSG, the EAV of that portion of the Sears parcel occupied by DSG for retail use is reduced below $80.00 per square foot DSG will pay the difference to the Village via a payment in lieu of taxes. The Village reserves the right to exercise any rights that it may have to object to or challenge DSG's property tax assessment challenges or property tax appeals.
Tax Increment Financing (TIF)
The Village may elect to create a TIF to recoup, in whole or in part, the incentive funds
The boundary of the TIF may include the Sears parcel-
Business District
The Village may elect to create a Business District (BD) to recoup the incentive funds.
DSG consents to the inclusion in the BD with an additional sales tax not to exceed 1%.
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This item is now before the Board of Trustees for consideration.
Recommended Action/Motion
I move to approve the Term Sheet between the Village of Orland Park and Dick's Sporting Goods for the redevelopment of the former Sears parcel at 2 Orland Square Drive, Orland Park IL 60462