The owner of an Ogden Avenue medical office building in Riverside says he may simply donate the property to charity and walk away from it after village trustees voted unanimously on Aug. 16 to reject a request to rezone the property in order to convert the building to condominiums.
Dr. Tahir Sheikh, who has owned the property since 1983, told trustees he simply couldn’t continue to lose more than $100,000 a year on a building that has just 17 percent occupancy and has become difficult to either lease or sell.
“I just cannot continue to see how I can drain myself year after year after year,” Sheikh said. “More than half of my salary is going into this.”
This spring, Sheikh brought forward a plan to convert the medical office building into 12 condominiums. In order to do that, he needed the property’s zoning changed from B1-C, a strictly commercial designation which does not allow ground-floor residential occupancy, to B1-TC, which does.
In May, the Riverside Planning and Zoning Commission recommended the zoning change with some conditions, including bringing the parking lot into conformity with village codes.
The following month, the village board delayed action on rezoning, asking Sheikh to make another effort to either sell or lease the property. Sheikh has again listed the property for sale at $1.5 million.
He said he has also attempted to lease spaces by offering rental rates as low as $7 per square foot, but continues to have no takers.
“We have done everything possible we can do,” Sheikh said.
On Aug. 16, trustees learned that Sheikh could not provide enough parking spaces in his lot for 12 condominiums, and that Sheikh was now proposing nine condo units.
Trustee Michael Sedivy, who expressed reservations about the rezoning back in June, said the loss of three condo units would mean the property would produce even less in property tax revenue than the mostly vacant building contributes now.
If the condos attracted families with children who use school services, rezoning the property would result in a negative financial benefit to the village.
“I think we lose significant money on that based upon the services that would be consumed,” Sedivy said. “From a village perspective, I cannot understand why we would consider this as the highest and best use of that property.”
Trustee Wendell Jisa also said he didn’t support rezoning scarce commercial property in the Ogden-Harlem area.
“Turing a commercial opportunity into residential homes is a huge mistake for the community,” Jisa said.
Jisa suggested perhaps Sheikh was having a hard time selling the property because of the high asking price. The outstanding mortgage on the property, Sheikh confirmed, was about $630,000.
“You’re asking $900,000 over the mortgage,” Jisa said, “maybe that’s a way for you to be more aggressive on the price.”
Part of the resistance to rezoning is the fact that the property sits immediately west of the Loyola Medicine Professional Building at 3722 Harlem Ave. Rezoning Sheikh’s property would stand in the way of possibly assembling the two properties in the future for a significant commercial development if Loyola ever wants to sell its land.
Community Development Director Sonya Abt said she has reached out to Loyola and has learned that they have no intent to sell the property at this time. The professional building is not fully occupied, but it houses three physician groups, a diabetes center, a wound-care clinic and an outpatient imaging center.