Strikingly, a glossy 13-page marketing brochure created to attract potential buyers to the 326-acre Arlington International Racecourse site is missing a price tag.
The brochure only asks interested parties to enter an “offer price” and a “real money deposit amount”.
According to the track’s owner, Churchill Downs, “numerous parties” have made offers on the site, including the Chicago Bears, home builders and a consortium looking to keep the venue open for live horse racing.
But no one says how much was offered for the four contiguous parcels that make up the property.
“That’s a valuable piece of land over there,” said Terry Kelly, the assessor of Palatine Township, where the property is located. “You will get top dollars.”
But what exactly is the highest dollar for the property?
The four parcels currently have a combined market value of $ 32.2 million, according to the latest property tax assessments from Cook County Assessor Fritz Kaegi’s office. However, that price was calculated during the pandemic when many commercial properties received significant disruptions because they could not be fully operated.
Last year, the appraisal office estimated the site at $ 44.6 million when the route operators were able to drive an entire season.
Churchill Downs officials also reportedly turned down a $ 200 million offer for the park and its casino license, according to an antitrust complaint filed by the Illinois Thoroughbred Horsemen’s Association with the Illinois Attorney General.
“Value is based on what you are allowed to build there,” said Mark Meskauskas, president of Arlington Heights-based commercial real estate company Brian Properties. “But I’ll bet it trades above $ 45 million.”
At the 2019 value, when the track operated a traditional full racing season, the property is valued at $ 3.14 per square foot. Real estate investment experts say some parts of the park that are on busy roads, such as Northwest Highway, Euclid Avenue, Rohlwing Road, and Wilke Road, could be worth between $ 10 and $ 20 per square foot. The interior parts should fetch between $ 5 and $ 10 per square foot.
“But you also need to consider the cost of removing the pre-existing improvements and the cost of redevelopment for what you are going to build,” said Jeff Kowal, senior vice president of investment sales for Edgemark Commercial, based in Oak Brook Real Estate Services.
At the high end of $ 20 per square foot, the property would be worth $ 284 million. At the low end of $ 5 per square foot, the site would be worth more than $ 71 million.
“I think it’s safe to say that renovating is worth more than keeping a circuit running,” said Joseph Santucci, owner of Avalon Realty Associates, Rolling Meadows. “In general, any kind of new development is good for an area because everything around it increases in value.”
Most experts believe that any redevelopment plans, including the Bears’ move, would involve mixed use of retail and residential components, which would make the property far more valuable than it is currently valued.
Connie Carosielli, an assessor in neighboring Elk Grove Township, believes the property will bring in much more than its current estimated value, but how much more is more difficult to determine.
“There are no comps,” she said of similar properties that can be compared to the track site. “Even if I gave you a number, it could be completely useless in today’s bloated market.”
However, she warned that if the property was sold, a shift in the property tax burden could be expected.
Last year Churchill Downs paid more than $ 3.5 million in property taxes on the property, according to Cook County’s treasurer records. Most of it went to the two school districts below.
Experts believe that if whoever buys the property does not use it for horse racing, they will immediately demolish everything and vacate the land in order to get a discount on property tax.
“Empty land is charged at practically nothing,” said Kelly.
But they also agree that it won’t stay empty for long.
“They’re sitting on an investment they want to get back,” said Kowal.
The development could also create new revenue streams that benefit the related tax authorities.
“Maybe a short-term blow to property tax revenue and base, but shortly after that it will more than make up for when all of these new things get going,” argued Kelly.
There is no schedule for announcing the sale. The route officials and their real estate agent did not comment or did not want to comment on the upcoming sales or bids.