An upscale fish and steak restaurant proposes to open in a long vacant space in The Reserve at Hudson Crossing luxury apartment complex along Washington Street in downtown Oswego.

The project is dependent on financial assistance from the village. Ellwood Steak and Fish House, which also has a restaurant on Sycamore Road in DeKalb, proposes to take over the vacant corner space at The Reserve at Hudson Crossing building next to Tabletop Game Shop.

At Tuesday’s Oswego Village Board meeting, village trustees will consider whether to provide of up to $340,000 in direct financial assistance along with a $300,000 loan at a 3% interest rate based on estimated project costs of $1.15 million.

The retail tenant space at 180 W. Washington St. has been vacant since The Reserve at Hudson Crossing building was constructed and opened in 2021.

“The village had previously received plans from a full-service pizza restaurant called Riot Pizza to take over the space, but the plans were abandoned in 2022,” Oswego Economic Development Director Kevin Leighty said in a memo. “Since that time, there has been occasional interest in the space, but no deal has come to fruition due mostly to the amount of work needed to build out a restaurant there.”

Village trustees last year raised the question of why the majority of the commercial space on the building’s ground level remains vacant. The Shodeen Group built the first building and recently opened Reserve at Hudson Crossing’s second building.

Shodeen Group President Dave Patzelt had said one of the big challenges is the upfront buildout costs for a restaurant.

“This is a new building, so we’re talking in the range of a $1 million to a $1.5 million to invest and build that out for the restaurateur,” he said. “Restaurateurs have asked us to front that money. We ask for some guarantees to it and we are unable to get the guarantees. So unfortunately, we have to suffer the consequences of that decision, which is we don’t have a tenant in there. We’d love to have a tenant in there, whether it’s a restaurateur or another commercial user, retail user, office user, whatever it may be, we’d like a tenant in there.”

Village staff is recommending up to a $340,000 incentive to be paid over a maximum of 10 years.

“The total incentive will be comprised of a $40,000 grant upon opening and up to $300,000 in rebated sales taxes,” Leighty said. “The applicant has also requested a waiver of village-levied permit fees, which is estimated to range anywhere from $8,000 to $15,000.”

Starting when the restaurant opens, the village will rebate 50% all sales taxes collected by the village for up to 10 years or until a maximum of $300,000 is incurred, whichever comes first.

In addition, the village will provide an economic development incentive award in the amount of $40,000 to be paid upon completion of the restaurant buildout.

Ellwood Steak and Fish House is projected to produce a substantial amount of tax revenue which would help offset the financial impact of the incentive.

“Over the 10-year incentive term, the restaurant is expected to generate anywhere from $500,000 to $1 million in total sales taxes depending on sales performance,” Leighty said. “Of this amount, the village would collect half during the incentive term and then an estimated $65,000-$80,000 annually thereafter based on reasonable sales projections.”