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July 20, 2018

6/27/2018 2:54:00 PM
Recycling Center: Smylie Seeks Release, City Looks to Re-Lease
By Mary Helt Gavin


While the City and Smylie Brothers are looking to unravel Smylie’s commitment to a now-defunct proposal to operate a brewpub at the City’s former recycling center, City officials are hoping to fast-track a new project for the property.

Earlier this month, City Council directed the City Manager to “execute a mutual termination lease” of the property, located at 2222 Oakton St.

At the June 25 Administration and Public Works Committee meeting, aldermen discussed next stops for the property – whether to sell or lease and what sort of tenant the City would approve.

Under the terms of the lease Smylie now seeks to terminate, the company was supposed to use a rent-free period of 18 months to improve the property and convert it into a brew pub.  Construction should have begun after the “inspection period” set forth in the lease, which, it seems, expired in May or June of 2017.

Emails obtained through an FOI request and given to the RoundTable do not indicate Smylie’s alternate plans.

A series of emails on Jan. 4 of this year between Economic Development Manager Paul Zalmezak and Michael Smylie seem to show the City still believed that Smylie would come through:

 Mr. Zalmezak: How are things progressing with Oakton space as we begin 2018?

Mr. Smylie: Not terrific.

Mr.  Zalmezak: Too bad. What level of investment are you seeking to get the deal done? Can you share that?

It is not clear how Mr. Smylie responded.

Community Development Director Johanna Leonard said the City learned only via social media that Smylie had opened a facility in the Chicago area.

Since there is no opt-out clause in the lease, City Manager Wally Bobkiewicz proposed in May that, in addition to seeking a mutual termination of the lease, the City should pursue requests for proposals for the property.

Even then, some parties had shown interest in the property: the owners of Peckish Pig, the Evanston Rebuilding Warehouse, a rock-climbing company and a fitness studio.

On June 25, aldermen agreed the City should issue a combined request for proposals and request for qualifications to streamline the process of finding a new occupant of the property.

Whether the property would be leased or sold is still an open question.

Ninth Ward Alderman Cicely Fleming, who did not attend the meeting, said in a statement that she preferred to sell the property rather than lease it. Her statement said in part, “I do not support the City going into another lease agreement, given the ineffective execution of the current lease and the previous lease with the Evanston Art Center. In addition, acting as a lessor would likely require the city to invest money into the building to repair the parking lot as was laid out in the current lease. This is money we simply do not have.”

Alderman Ann Rainey, 8th Ward, disagreed saying, “That argument is illogical. First of all, a lease with one person has absolutely nothing to do with a lease with another person. I would argue that we leave this open. … With a sale we lose control. The property is adjacent to one of our biggest parks. That property could be resold in five years and we might not approve of the buyer, I would rather see us watch to see how responsible the [new] user is.”

Ald. Rainey also said the new user would have to be a tax-paying entity.

Alderman Eleanor Revelle, 7th Ward, said, “I think it’s premature to narrow our focus like that. There could be other entities that could add to the community [even if they do not pay property taxes]. I would urge the Council not to limit it to tax-paying entities.”

Alderman Don Wilson, 4th Ward, said he would like to leave open “the notion of an outright purchase.”

Since the City can take no action until the lease is terminated, the matter was held in committee, with the expectation that City staff will have resolved the lease and crafted a combined request for proposals and qualifications for a July meeting.





Reader Comments

Posted: Tuesday, July 10, 2018
Comment by: Junad Rizki

The following was earlier: the city knew in the fall of 2017, the deal was done, question why did the staff wait so long to tell us?

Staff also did not follow through with getting the property on the tax rolls.

Clearly the city can not do deals, that benefit us at all. There is a long history here of giving our money away!

( following emails are from a FOI - provided to me by the City of Evanston on the deal)

Johanna N. Leonard, AICP
Community Development Director
City of Evanston
jleonard@cityofevanston.org | 847.448.8014
Date : 9/28/2017 1:32:47 PM
From : "Michael Smylie"
To : "Nyden Leonard, Johanna"
Subject : Re: text
I have other people but will cost me a lot more. Definitely we should get together. Let me talk to this other capital group that is interested though to
get better idea how feasible will be with them.
On Sep 28, 2017 1:27 PM, "Johanna Leonard" wrote:
No, that isn't good news. I am sorry, but at least they gave you an update.
Can I suggest that we all meet (you, me, and Rainey) to see what we do next? Do you have other investors that might be interested?
On Thu, Sep 28, 2017 at 1:09 PM, Michael Smylie < wrote:
Not the best of news. Here is his emailed response:
Mike, I donít want to put you off anymore. While I was on vacation, they talked and now have cold feet with respect to the craft beer
market. They have been - radio silent Ė regarding the investment and submitting the term sheet Iíve asked several times. The board is
physically meeting next week. I think they are going to pass on the investment, and will likely provide some detail as to why they switched
positions drastically. I would suggest opening it up to whomever you can. If I can turn it around, Iíll let you know, but I doubt it. As Iíve told
them, I think youíll make a go of it and be successful in expansion. I canít, however, always convince everyone. Iíll share with you what I
can when we talk. Thanks for the patience and assistance. Jeff
On Thu, Sep 28, 2017 at 12:54 PM, Michael Smylie < wrote:
saw your message, I emailed these guys this morning so I'm waiting their response....




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