Astellas US Holding, Inc., a subsidiary of the Japanese pharmaceutical company Astellas Pharma, which owns the twin tower office campus at Willow Road and I-294 in Glenview, was granted a resolution recommending an extension for another 12 years of its 7B Cook County property tax incentive.
Glenview trustees approved both a resolution authorizing an economic incentive agreement and a resolution of support for an extension of a Cook County 7(b) Real Estate Tax Incentive, on their Tuesday, Dec. 6 village board meeting.
The 7B property tax incentive reduces the tax rate on corporate property from 25% to 10% for 10 years, bringing the rate to 15% in year 11, then to 20% in year 12 before returning it to 25% in year 13. Cook County grants 7B tax incentives, but they require a local government recommendation.
Astellas built two new office towers at the location, totaling 431,792 square feet, in 2008. That same year, the village inked an economic incentive agreement with Astellas, which was amended in 2009, in support of the 7B tax incentive, which was granted in 2013. During the COVID-19 pandemic, a village report says Astellas consolidated operations into its north tower, leaving the south tower vacant.
The incentive agreement requires $18 million minimum investment by Astellas into its south tower by Dec. 31, 2025 and to have a new tenant in place in the south tower by the end of 2026. A village report says that $18 million investment could be divided with $14 million from Astellas and $4 million from a potential new tenant investing in the building.
The proposed agreement includes a “make whole payment” provision in which Astellas would pay the difference to the village if taxes did not reach initial estimates for all taxing bodies made in the initial agreement. The agreement allows Astellas to request a downward adjustment in the annual tax estimates, “upon submission of reasonable evidence.”
The agreement also mandates that a minimum of 750 full-time equivalent employees be employed at the property through the term of the 7B tax incentive.
A village report estimates Astellas would pay $43,902,449 in total property taxes to all jurisdictions between 2023 and 2034 without the tax incentive in place or would pay $21,612,604 in property taxes with the incentive in place during the same period, a difference of $22,289,845.
The village report says Glenbrook High School Dist. 225 and West Northfield Elementary School Dist. 31 expressed concerns about the extension of the 7B. Village officials requested the school districts provide those concerns in writing before Tuesday’s village board meeting. A Dist. 225 spokeswoman said the district did not send any correspondence to the village. Deputy Development Director Jeff Rogers said Dist. 31 asked that the village be careful in considering these types of tax incentive recommendation requests.
Village President Mike Jenny warned if Astellas were to relocate from Glenview it could have long term negative impacts on the village’s economy.
In their application, Astellas officials warned, “should the renewal of the Class 7b incentive be rejected by the village, there are potential negative impacts visible on the horizon. Current interested potential tenants for the south tower insist the Class 7b incentive be renewed before negotiations can commence in earnest. Without the incentive, the current prospects will turn their attention to the less costly Lake County.”
Astellas officials said should the south tower remain vacant it would then decrease in value over time.
“While the decrease may be proportionally minimal, the impact on the tax revenue becomes significant to taxing jurisdictions, should the vacancy become long-term,” the Astellas application says.
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