Nature’s Treatment of Illinois cannabis dispensary and a Stern Beverage Co. distributorship would relocate from Milan to Rock Island if the city is successful in its efforts to reach development deals for two southwest Rock Island city-owned locations.
During its Monday, Aug. 26, meeting, the Rock Island City Council took a critical step in pursuing those twin developments when members unanimously approved letters of intent to enter into negotiations with A Hana Illowa LLC.
The company is owned by Matt Stern and Jeff Hughbanks. Rymak Construction Group will act as general contractor for the development.
The men plan to construct a cannabis dispensary at the corner of 38th Street and 60th Avenue West on the 10-acre site. The property is across from Bally’s Quad Cities Casino. It is part of 23 parcels of mostly wetlands which the City of Rock Island bought for $23 – or a dollar a parcel – from the Riverstone Group in 2022.
Development plans for the 6,500-square-foot dispensary include an upstairs smoking lounge and a 5,000-square-foot building for future expansion, the city said in a news release. Plans include a 50,000-square-foot grow facility with options for three additional 50,000-square-foot buildings, the city release said.
Developers also plan a full-service truck stop adjacent to the dispensary.
As the city negotiates on the dispensary site it also will be working to reach a deal on the 43-acre site nearby it owns that is the former Campbell’s Sports Complex at 8399 29th St. West.
That’s where A Hana hopes to build a new facility for Stern Beverage distributorship operations. It will include truck bays, large parking lots, energy efficient warehouse space and room for future expansions.
A significant investment
The two projects, if realized, would bring significant investment to Rock Island, but city leaders said it is too early to put a figure on that investment.
Mayor Mike Thoms did say of the cannabis dispensary project , “This is a big deal, the city is very excited. They’re going to build a new building, creating new property taxes. They’re looking to get (a location) closer to Iowa.”
Both the dispensary and a Stern Beverage relocation also “are a symbol of growth for Rock Island, which feeds more growth,” Mr. Thoms said. And he envisions the whole corridor near Bally’s seeing new investment as a result of the dispensary project.
“There’s a lot of good, positive things happening now in Rock Island,” Mr. Thoms said. He added that as companies see investment in Rock Island, they are being spurred to make their own investments there.
That property has been a top priority for the city since it was acquired. While Rock Island has had a cannabis growing facility operating in city limits, it did not have a dispensary.
Rock Island Economic Development Director Miles Brainard had told the QCBJ last summer, he anticipated it only be a “matter of time before a developer picks Rock Island for their cannabis business.”
He told the QCBJ on Wednesday the city is “very excited” about landing what is Rock Island’s first cannabis dispensary. “It’s been a long-term goal. We’ve been dreaming about it since the law passed. Staff has been eager to get one.”
Tom Flaherty, Rock Island’s assistant to the city manager and economic development director, has been leading the project and the negotiations from the beginning.
He also told the QCBJ Wednesday “We didn’t go after them. They came to us.”
NTI outgrows old location
Mr. Flaherty added, “They had outgrown their Milan facility and they were looking for alternatives and we just happened to have a pretty good site for them.”
Among the advantages, he said, is its proximity to Iowa, which doesn’t have cannabis dispensaries. The Southwest Rock Island location is 2.2 miles and one traffic light away,.
Hana’s interest also came at a good time for city development leaders because they were already working with Shive-Hattery to do the engineering work on the site.
“It happened at roughly the same time, because I was thinking it was a good thing that we had Shive on the job because that way we didn’t have to start from scratch,” Mr. Flaherty said in an interview.
With that and the letters of intent in place, the next step will be to “sit down with Stern and begin hammering out the details of the letter of intent,” Mr. Flaherty said.
That letter calls for reaching an agreement within 60 days.
“They wanted to move fast,” Mr. Flaherty added.
As negotiations on a final agreement begin in earnest, Mr. Flaherty said “I just want to thank Jeff Hughbanks and Matt Stern for their professionalism and their desire to make this happen. They’ve been great partners and we look forward to more partnerships with them.”
Mr. Stern did not return a request for comment from the QCBJ. But in the city’s news release he said, “We are thrilled to be a part of these exciting development projects in Rock Island. We are committed to bringing quality businesses to the area that will benefit the community and create economic growth.”
Mr. Hughbanks added in the release, “We are confident these projects will have a positive impact on the community and are excited to see them come to fruition.”
Milan braces for losses
As the city negotiates with A Hana, the Village of Milan will be watching to see what will happen with its existing NTI location. Indeed, both the loss of the Milan dispensary and the Stern Beverage distributorship could raise challenges for Milan if a deal is struck in Rock Island, Village Administrator Steve Seiver told the QCBJ.
For example, the potential loss of tax revenues including sales taxes on recreational and medical marijuana could put serious pressure on Milan’s budget. The pass-through recreational marijuana sales tax dollars from the State of Illinois alone generate about $1 million a year, Mr. Seiver said.
Some of the impact of those tax dollars losses could be offset by revenue from a new dispensary that opened recently in the village. But if the net loss is significant, Mr. Seiver worries about the impact on village residents.
Terrace Cannabis recently opened at 800 Tech Drive – down the road from NTI and Stern Beverage. It also operates a dispensary in the former Moline Aldi’s store on Avenue of the City.
That’s because non-home rule communities including Milan have limited sources of revenue. Leaders often have few options to overcome large losses other than cutting city services or increasing property taxes.
(Editor Jennifer DeWitt contributed to this report.)
