Caterpillar and OSF HealthCare are partnering to redevelop a downtown Peoria block.
Caterpillar is donating the former Chase Building, 124 SW Adams Street, the former Peoria Professional Building, the adjoining parking lot and $3 million to OSF HealthCare.
OSF plans to redevelop the property into a new Ministry Headquarters with nearly 700 employees.
Caterpillar had purchased the property to be included in the new and expanded corporate headquarters footprint originally announced for downtown Peoria in February, 2015. CAT shelved those plans in January, 2017 when it announced it was moving its corporate headquarters out of Peoria, later choosing Deerfield as its new corporate home.
“It’s more than just a ministry headquarters for OSF,” said OSF HealthCare CEO Bob Sehring during a formal announcement Thursday morning in the lobby of CAT’s administration building. “It really is about the rehab of the block bringing more amenities downtown that support the employees of Caterpillar and the mission partners of OSF.”
“I can’t think of a better partner to be downtown,” said Caterpillar Group President and CFO Brad Halverson, “and to really take some business and people to the community here downtown.”
Sehring admitted that a lot of work needs to be done to the former Chase building, both inside and out. Sehring said OSF is looking forward to getting started.
“Because, in many respects, what it represents is a blank canvass on the inside,” Sehring said. “That gives us, again, an opportunity to create really a collaborative space.”
Sehring said before any work can begin, OSF will be working with the City of Peoria to get the building listed on the National Register of Historic Places as a contributing building within a historic district. That designation will allow OSF to receive tax credits toward the block’s development.
“Absent that program, quite frankly, it would not be feasible to work on buildings such as the former Chase building and really begin to rehabilitate that and make it a continuing part of the downtown landscape,” Sehring said.
OSF officials say the City Council will need to take action to create a redevelopment agreement for the property and approve a parking solution for the approximate 700 OSF employees moving to downtown.
Peoria Mayor Jim Ardis estimated the renovation of the “Chase block” will cost in the area of $90 million.
Ardis said he and other civic, community and business leaders are “energized” by the announcement.
“We all know how important it is to attract and retain talent,” Ardis said. “This will definitely do that for one of the largest employers in our city and one of the largest employers in our state.”
“This is teamwork that way it’s supposed to be done and it’s something that all of us should be proud of,” Ardis said.
OSF officials say the former Chase building and the former Peoria Professional Building are vacant, so there are no current tenants who will be displaced. Based on the condition and lack of historic value, OSF intends to demolish the Peoria Professional Building and the parking deck attached to the Chase building. The surface parking lot at the corner of Adams and Main Streets is currently used by Caterpillar for visitors. It will be used by both CAT and OSF.
OSF HealthCare has no intentions of selling buildings purchased by OSF in Franciscan Prairie and Pioneer Park. Officials say they have specific space needs and those properties fit into the long-term plans to meet those needs.
The redevelopment project is expected to create more than 200 construction jobs and the resulting economic spinoff associated with the construction work. It is estimated OSF “Mission Partners” will provide an added $1-2 million each year to the Peoria economy at local retail locations such as restaurants, coffee shops and gift stores.
While an excess of 700 employees will be moving into the downtown location, OSF says it has not been determined what “Mission Partners” will move into the location.