Des Plaines Approves Costco Incentive Package

A Chicagoland suburb is rolling out the tax incentive red carpet for big box retail.

Des Plaines city officials signed off on more than $17 million in incentives on Monday to lure a Costco Business Center and gas station to a struggling office park site, green-lighting a redevelopment effort that hinges on costly sitework and public support, the Daily Herald reported.

The city council unanimously approved a package for Evergreen Park-based developer RSA Properties II that includes a property tax break, sales tax rebates and access to municipal equipment — a deal officials framed as necessary to transform a physically constrained site into a viable commercial project, according to the publication.

Plans call for a 137,000-square-foot Costco Business Center and a 24-pump gas station on roughly 14 acres at 2200 and 2400 East Devon Avenue, just west of I-294. Costco is expected to purchase the land and build the store once site preparation is complete, with an opening targeted for late this year.

Redevelopment is expected to cost more than $30 million, driven largely by the need to reconfigure the property’s existing layout, including filling in part of a 16-acre retention pond to create usable land for parking, according to the outlet.

To offset those costs, the city agreed to support a Cook County tax incentive that would reduce the property’s assessment rate for 12 years, cutting an estimated $7.5 million from the tax bill, according to the publication. Des Plaines will also rebate up to roughly $9.8 million in sales tax revenue over a decade, plus interest.

City leaders also granted limited use of flood-control equipment to help drain the pond — a key step in unlocking the site’s development potential. Officials said the work is not expected to harm aquatic life. The property was formally declared blighted, clearing the way for incentives tied to economic revitalization.

Support wasn’t unanimous among neighbors. The gas station component drew some pushback, though local aldermen ultimately backed the plan, citing its potential to generate tax revenue and reinvigorate the area.

— Eric Weilbacher