Hofbräuhaus building, land owners say Belleville still owes them tax incentives
The Hofbräuhaus building and land owners are suing Belleville for tax incentives they say they were promised years ago, accusing the city not only of breaching their 2015 agreement but also scaring away prospective developers for the property.
In response to their two requests for payments in 2022 and 2024, Belleville argued the landowners had failed to complete the development the city was expecting under the agreement, court records show.
Oblate Shrines and Renewal Center, Royal Banks of Missouri and Richard Striler, the court-appointed receiver for Hofbräuhaus, filed the lawsuit May 14 in U.S. District Court for the Southern District of Illinois. They are seeking at least $748,100 in payments they say come from the developer’s share of tax increment financing and business district sales taxes, plus damages from the city.
In the complaint, they argue Belleville is misinterpreting their 2015 agreement for development of the 26-acre property off of Illinois 15 across from the National Shrine of Our Lady of the Snows.
Cliff Cross, economic development, planning and zoning director for Belleville, told the court-appointed receiver and his attorney that the city denied their requests for tax incentive payments because they failed to complete the whole project within the timelines detailed in the contract.
Today, the property includes the former German-themed restaurant Hofbräuhaus St. Louis-Belleville, which closed in 2023 after a series of financial and legal problems. The development was to also include hotels, a conference center, upscale restaurants and a fuel, convenience store and fast-food complex on the property.
“The developer remains in obvious default of the redevelopment agreement,” Cross wrote in letters to them, which were included in the federal lawsuit as exhibits. “... As previously stated, the city remains willing to consider a proposed amendment to the redevelopment agreement in order to initiate much-needed progress on the redevelopment project.”
The building and land owners argue in their lawsuit that the agreement gives them until at least Dec. 31, 2038, for the entire redevelopment project’s estimated completion date, and it allows for “periodic reimbursement payments” to the developer until then.
They say they invested over $20 million toward the development because of the promised tax incentives and describe the city’s denial of the payments as “truly irrational.”
They also blame the city for indefinitely stalling construction at the property by allegedly telling prospective developers the agreement for tax incentives is no longer in effect or not enforceable, which the plaintiffs argue isn’t true.
“Royal Banks and the receiver have communicated with multiple prospective developers of the property, including hotel developers, general commercial developers, and restaurant operators, all of whom expressed serious interests and intentions to develop the property or operate the Hofbräuhaus restaurant improvements,” the lawsuit states.
“However, nearly all have refused to put forward plans to develop the property or operate the Hofbräuhaus restaurant until the city honors the redevelopment agreement by disbursing tax incentives.”
Belleville has not yet filed a response to the lawsuit in federal court. City attorney Garrett Hoerner couldn’t immediately be reached for further comment on Saturday. His office is closed on weekends, and he didn’t respond to an email seeking comment.
The land for the development is owned by Oblate Shrines, which is affiliated with the Catholic congregation of priests and brothers who operate the Shrine in Belleville.
The now-shuttered Hofbräuhaus building on the property is owned by Missionary Ventures, a limited-liability company that leased the land and built the restaurant. But after the company defaulted on a loan, Royal Banks of Missouri, the lien holder, persuaded a St. Louis County Circuit Court judge to appoint a receiver in 2019.
