EAST PEORIA — Now home mostly to national chain restaurants and stores, the Levee District, touted as the city's “new downtown,” could be the home address of actual East Peoria residents if a proposed residential development is successful.

On July 15, the City Council approved an agreement with developer Jeff Giebelhausen to build combined apartments and commercial space inside a building that is at least five stories tall. The high rise would be located on property adjacent to the new Fondulac District Library.

EAST PEORIA — Now home mostly to national chain restaurants and stores, the Levee District, touted as the city’s “new downtown,” could be the home address of actual East Peoria residents if a proposed residential development is successful.

On July 15, the City Council approved an agreement with developer Jeff Giebelhausen to build combined apartments and commercial space inside a building that is at least five stories tall. The high rise would be located on property adjacent to the new Fondulac District Library.

Giebelhausen is a former mayor of East Peoria and the former chief operating officer of Cullinan Properties at the time the city approved the company as the site’s developer.

“We believe the existing retail, service amenities, central location, proximity to employment and desire to live in an urban setting all make the project worth pursuing,” Giebelhausen said July 15 in prepared remarks. He did not attend the council meeting July 15 because of a conflict. “This project will take time to assimilate, but we feel the structure sets forth timing milestones that, if met, result in a systematic process which can lead to a successful project. Projects can’t be rushed, but timing is critical to seize opportunities.”

Elusive as a residential project in the Levee District has been, Commissioner Gary Densberger described the Giebelhausen proposal as the potential missing link of the city’s new downtown area. Currently, the district is home to Target, Costco, Gordmans, Ulta Beauty, Red Robin Gourmet Burgers, Panda Express and more. A new McDonald’s is being built and a new Noodle’s & Company was announced July 15.

“A residential complex in the Levee District has been something that I believe the council as a whole has been interested in from the beginning,” Densberger said. “It’s somewhat speculative, but I hope the project is viable and works out.”

The agreement gives Giebelhausen’s Levee District Residential LLC control of the property between the Clock Tower Drive roundabout and the library “for a period of time necessary to confirm the feasibility of the project,” according to a memo to the council and mayor from City Attorney Dennis Triggs and Ty Livingston, the city’s director of planning.

“The city’s obligations are limited until such time as the city determines that it is satisfied with the quality and feasibility of the project,” the memo reads.

The agreement calls for a minimum of 80 residential units and at least 7,000 square feet of commercial space on the ground floor of a building that must be at least five stories tall.

The developer has 60 days to sufficiently refine a proposal that would attract serious investors; 150 days to present a preliminary application; and 240 days to present a final application, complete with financing details. Sale of the property from the city to the developer must occur before Oct. 15 and construction must begin by May 16, 2016. The city’s main obligation in the agreement is to refund more than half of the property taxes paid by the complex over its first 10 years.

“That’s a steep cost,” said Commissioner Chad Joos. “But we have had trouble with the residential component. It’s not coming on its own.”

Another similar upscale blend of a commercial and residential project proposed by