Oberweis Sweetens Plans for Skokie's Dempster Street Corridor

Children of all ages will score some ice cream and nearby Skokie scored a big victory in its attempts to invigorate West Dempster Street as Oberweis Dairy plans a move to the village.

At their April 20 board meeting, Skokie's village trustees approved starting the process of selling land to the Oberweis Dairy. The parcel at the southwest corner of Dempster and Skokie Boulevard had been acquired through eminent domain.

The noted dairy and product maker is expected to construct a 4,000-square-foot building to serve as an ice cream store as well as a quick-serve restaurant, which is a new concept for Oberweis and is expected to feature fast-food staples.

“We believe this represents the shot in the arm West Dempster Street needs,” said Tom Thompson, economic development coordinator for Skokie. “It will serve as a catalyst to West Dempster corridor.”

Skokie trustees are expected to eventually pass an ordinance that will authorize the sale of the property to Oberweis, which will present plans for the site  to the Plan Commission this summer. If all goes well, construction should begin later this year and the store would open in 2012.

Oberweis operates 46 stores in four states, with the 35 in Illinois its largest base. However, Skokie residents must travel to Lincolnwood or Glenview to patronize a shop.

“This is a new venture for us,” CEO Joe Oberweis said. “We've been working on the concept for a long time. It's a bit of a challenge to find something that will work.”

Oberweis considered opening the store on Golf Road near the Westfield Old Orchard Mall, but the company deemed that space too small. It then reached an agreement with the village to move into the Dempster Street property, which will have a drive-through and parking.

“This is a great match for the village and for us,” Oberweis said. “I think this is going to be a real turning point for Dempster Street.”

Oberweis has offered $400,000 for the property, whose development will include an additional $1.2 million for construction and startup costs. The company will also pay the village annual land payments of 5 percent of sales at the site when that amount exceeds $1 million. For example, $1.85 million in annual sales--which is a mid-range projection--would mean a payment of more than $487,000 for Skokie. Moreover, property and sales taxes are expected to generate almost $800,000.

All sides consider this will be a successful move for the dairy company.

“Before we make any investment in a down economy, we think twice,” Oberweis said. “But we are in this for the long term.”

The village owns both parcels of property on Dempster between Niles Center Road and Skokie Boulevard. Following the 2008 purchase of the eastern parcel for $840,000, Skokie last year purchased the western land for $825,000 after a lengthy eminent domain process with Avery Tarshis.

Tarshis was eventually forced to move his Value Transmission auto repair shop about six blocks south. “I would have preferred to stay where I was. But I am where I am now,” the business owner said.

The redevelopment strategy is part of the village board's attempts to invigorate the struggling West Dempster Street corridor. When the economy tanked and stores closed, the village undertook a policy of purchasing land using tax increment financing (TIF) funds with the hope of selling the property to developers once the economy regained some strength.

“This initiative is but the first step in renewed development of the West Dempster Street corridor and will undoubtedly serve as a catalyst for additional interest in the village's remaining West Dempster Street opportunity sites,” Mayor George Van Dusen said in a statement.

After taking control of the parcels, the village sent out more than 500 marketing brochures and solicited developers, brokers and retailers whether they were interested in the property. Some proposal got rejected outright: one for a small retail building and an unsolicited offer of $400,000 for an unknown use of the site.

But not everyone thinks that the village is on the right track. Tarshis is skeptical about the prospects for an Oberweis at the location.

“They can put a Hilton hotel up there for all I care,” Tarshis said. “I would assume they [village officials] wanted something that generated more money than an Oberweis," he added about the prominent intersection.