Urban Equity Properties to tackle $45.6M revamp of historic News Tower in downtown Rockford

By Kevin Haas
Rock River Current
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ROCKFORD — Urban Equity Properties is preparing to close on the purchase of the historic former News Tower in downtown and take on a $45.6 million redevelopment of the iconic part of the city’s skyline.

The Rockford-based real estate company plans to revamp the campus at 99 E. State St. with 80 luxury loft apartments, many with views overlooking the Rock River. There will also be 12 retail spaces in what’s envisioned as an emporium for small business and a riverfront restaurant space. A small publishing museum will also be built to honor the site’s history. Its future name will be the News Tower Lofts.

“It’s monumental,” said Justin Fern, founding principal of UEP. “It truly is one of the greatest buildings in the city. … If you look at all the Rockford publications and if they have a skyline, it’s likely going to be that tower in the photos.”

Iconic Energy had purchased the former Rockford Register Star building from a subsidiary of the newspaper’s parent company, Gannett, for $1.7 million in December 2021. Iconic had its own multi-million redevelopment plan. However, owner Teague Dickey decided to step back from that plan and put the building up for sale after he expected a downturn in solar business with a tax credit incentive for homeowners to install systems ending this year.

Fern is stepping in with what will be UEP’s biggest downtown redevelopment to date. The developer recently opened the Nu-State Apartments at 119 N. Church St., the Water Power Lofts at 700 S. Main St., and work is underway on the Chick House Flats at the corner of Elm and Main streets, to name a few of its biggest downtown redevelopments.

“Somebody has to do it now that Iconic is not able to take on the project,” Fern said. “It’s truly the next chapter of downtown.”

UEP expects to close on the purchase from Iconic in early to mid January, and then seek City Council approval on a redevelopment deal that will include cash incentives and tax reimbursements from a tax-increment finance district.

If approved, predevelopment work will take place throughout 2026 with construction starting in 2027. The goal would be to complete the redevelopment by mid to late 2028. It would be a full union project, Fern said.

“It’s a big construction job creator. We’re talking about a couple years of construction,” he said. “But also it’s going to be a big permanent job creator with all  these different retail spaces and the restaurant.”

The small business emporium is located across the street from Rockford City Market. It’s a fitting spot considering that the market helps give many businesses their start before they can open their first brick-and-mortar store, Fern said. Rental rates in the emporium would be approximately $800, significantly less than the going rate for downtown leases.

“It gives a whole bunch of new businesses an opportunity to have a brick-and-mortar space on State Street,” Fern said. “It’s really going to act as an in-between the catalyst and the permanent brick-and-mortar space that may be unaffordable for a lot.”

The city’s proposed redevelopment agreement would allow UEP to be reimbursed the increment generated by the TIF district on a pay-as-you-go basis. TIF districts work by capturing increases in property taxes that come when a site’s value increases into a special fund for redevelopment purposes. For example, if a building was worth $1 million and paid $10,000 in taxes, but improvements made the building worth $2 million now paying $20,000 in taxes, the extra $10,000 in taxes could be reimbursed for redevelopment costs.

The city also plans to provide UEP with $3 million from its redevelopment fund as a forgivable loan, meaning it wouldn’t need to be repaid if the company upholds the redevelopment deal. An additional $1 million would be provided as a cash advance from the TIF district. It would be repaid to the city at $50,000 annually for 20 years.

The project will also benefit from state and federal historic tax credits offered for redeveloping buildings while keeping their historic integrity intact.

“The future of this building has been hanging out there for quite some time,” said Rockford City Administrator Todd Cagnoni. “For Urban Equity Properties to get the property under contract … and ultimately determine what the best path forward to get the building redeveloped and hopefully stabilized for another 100 years is critically important to our community.”

The eight-story Art Deco building is one of the city’s most recognizable architectural features. It was designed by famed local architect Jesse Barloga and built in 1930.

“You could imagine if this property went into a blighted condition how negative it would be for our community,” Cagnoni said.

He said the city is showing its commitment to historic preservation by investing in redevelopments to the News Tower, the former Watch Factory and the former Chick House Hotel, among other projects.

“I can’t think of a community that is investing more in historic preservation than Rockford,” Cagnoni said.

The proposed redevelopment deal will go to the City Council’s Planning and Development Committee on Jan. 5 for its initial discussion.

This article is by Kevin Haas. Email him at khaas@rockrivercurrent.com or follow him on X at @KevinMHaas or Instagram @thekevinhaas and Threads @thekevinhaas