Crain's Chicago Business

HOUSING: She’s leading the city’s charge to create more affordable homes. PAGE 3

JOURNALISM: Chicago Reader’s nonprofit transition stalls. PAGE 2

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Turning beer into billions

CRAIN’S CHICAGO BUSINESS

COMMUNITY DEVELOPMENT

The Reyes family-owned distribution giant rolls up small fry as it expands into soda pop

BY STEVEN R. STRAHLER

AN ELUSIVE PATH TO

PROSPERITY

Systemic bias steers minority professionals to community development rather than the more lucrative commercial real estate and private-equity fields PAGE 13

After J. Christopher Reyes paid $36 million for the Driehaus estate in Lake Geneva—adding to his portfolio of luxury homes in Lake Forest, Florida, Aspen and Hawaii—it was no mystery how the beer baron could afford the highest price ever paid for an estate in the longtime getaway for Chicago’s elite.

Reyes Holdings is the secondlargest privately held Chicagoarea company and the sixth largest nationally, having quadrupled sales, to $31.5 bil-

lion, since 2005. Reyes and his brother, Jude, co-chairmen of the Rosemont-based company, were tied recently at No. 240 on the Bloomberg Billionaires Index, with a net worth of $9.46 billion each.

Yet size, wealth and longevity bring challenges, including succession and antitrust issues, as the brothers head toward age 70 and younger brother Duke, the company’s CEO, turns 65 this year. The Biden administration is scrutinizing market See REYES on Page 21

Why companies come to Chicago to innovate

Big firms make the city a hub for high-tech development centers

“These co-creation innovation labs and hubs are now all the rage,” says Dean DeBiase, an entrepreneurship professor at Northwestern University’s Kellogg School of Management.

Innovation hubs serve several purposes. Companies use them to find new clients, develop products in-house, or identify startups and technologies to acquire.

See INNOVATION on Page 22

JOHN R. BOEHM

CHICAGO IS BECOMING A DESTINATION for corporate innovation centers, a trend that boosts the local startup economy and spurs research and development activity in Illinois.

About a dozen companies, including Bosch, Tyson Foods, DHL, Accenture, Caterpillar, KPMG, the Department of Defense and Kellogg, have opened innovation hubs in Chicago since 2016, according to Crain’s reporting and data from World Business Chicago.

BY KATHERINE DAVIS

Lavanya Venkateswar, left, and Kevin Hack of Univar Solutions

NEWSPAPER l VOL. 45, NO. 7 l COPYRIGHT 2022 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

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REAL ESTATE

YOUR VIEW

Morningstar eyes move from its longtime home at Block 37.

PAGE 7

Threats and intimidation against health care workers must end. PAGE 10

2/11/22 3:45 PM

2 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

GREG HINZ ON POLITICS

Mask mandate may go, but mask wars will remain

F

boring Kentucky is at 136%, Missouri at 118%, Indiana at 97%, Ohio at 80% and Wisconsin at 64%, with only Iowa slightly lower at 57%, as of Feb. 8. All of them are less vaxxed and dropped masks earlier than Illinois.

A recent, real-world study of 12,000 COVID-infected households in Denmark found those who received the booster vaccine were 56% less likely to be infected than those not boosted, and measurably less likely to pass it on to others.

Yet, to some, none of that counts. All that counts is them. And if they don’t get their way, well, golly, they’ll throw a tantrum. Like terrorizing the local school board for doing its job. Or leaving filthy threats for state Rep. Deb Conroy, D-Villa Park, for sponsoring a misunderstood bill that merely would make it easier for the state health department to share data with counties. Or truckers in Canada, who are literally stopping ordinary life—think auto factories, which now are shutting, leaving workers without a paycheck—until they get their way.

Well, I have a message back to the bully boys, many—not all—of whom are kissing cousins of the Jan. 6 crowd.

TO SOME, EVIDENCE DOESN'T Innate to the COUNT. ALL THAT COUNTS IS THEM. human condition, as fundamental than 900,000 Americans are as “freedom,” is the right dead, nearly 36,000 of them to self-defense. If you stick here in Illinois. That’s about a gun in my face, I have a the size of Park Ridge—man, right to pull mine out and woman and child. Millions shoot you. If you wave a of others have been hospiknife at me, I have a right to talized or otherwise suffered knock it out of your hand. the trauma of losing their And if you threaten my life health or watching a loved and safety by getting in my one do the same. The threat face with potentially deadly COVID has posed and congerms—and you refuse to tinues to pose is as serious take reasonable precautions, as it gets, and those who like being vaccinated and deny it really do believe that masked—I have a right to George Soros and Venezuela defend myself. I, and everyfixed the last presidential one else, can do that perelection. sonally, and create mayhem.

Another fact that’s inarOr, we can do it through our guable to anyone who cares group agent, the governto rationally review the eviment, and entrust it with the dence: Vaccines and masks power to defend us against work. Not perfectly, mind navel-gazing fools. you, and not all the time.

That’s where we are right But work in the sense of now in this pandemic. It reducing the odds of being wasn’t right to riot and burn infected or, more importdown someone’s neighborant, of being hospitalized or hood after George Floyd dying. died. Nor is it right to endanTwo examples: ger others by proclaiming your freedom supreme.

Total Illinois COVID hosCOVID will go. I’m not so pitalizations now are 60% of sure about the attitude. The what they were at the peak last mask wars continue. winter. In comparison, neighor good or bad, the days of mask mandates and perhaps even required vaccination for COVID-19 are passing, at least for now.

A minority of the population—screaming about “freedom,” but oddly not about life—has rattled the pols. So has the fact that all of us, whatever your politics, are exhausted with this pandemic and want to get to the new normal ASAP. Ergo, Gov. J.B. Pritzker and other blue state governors are backing off, likely to soon be followed by Mayor Lori Lightfoot.

But if you think the mask wars are over, think again. As with the continuing debate over “legitimate political discourse” and the events of Jan. 6, 2021, this one has legs.

Now, we all can debate the proper way to deal with a pandemic, whether certain controls and limits are effective or not. And we can argue about whether the tactics and approaches needed before effective vaccines arrived are the same ones worth using a year later.

What we can’t argue about is that this pandemic is unlike anything the world has seen in a century. More

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Flap over editorial control puts Chicago Reader’s future in doubt

A co-owner’s column expressing skepticism about vaccines sparked a backlash—and a counter-backlash. The resulting stalemate threatens the publication’s nonprofit plans.

BY ALLY MAROTTI The Chicago Reader’s planned transition to a nonprofit has stalled amid a tussle over editorial control at the 50-year-old publication.

The impasse throws into question the future of the Reader, which began its transition from a low-profit limited liability company to a nonprofit roughly two years ago in hopes of achieving a more stable ownership structure and financial footing. The publication changed hands multiple times in the past decade. Most recently, Chicago investors Leonard C. Goodman and Elzie Higginbottom bought the Reader from the Chicago Sun-Times for $1 in 2018, assuming its debt.

The current stalemate traces back to a November column Goodman wrote titled “Vaxxing our kids,” which detailed his concerns over vaccinating his 6-yearold against COVID-19.

Two members of the Reader’s board, which unanimously approved the plan to transition to a nonprofit in late 2019, said they were concerned over what they viewed as potential censorship of the column. The Reader hired a fact-checker to review the piece after staff members and readers complained about the column post-publication.

The two members, Dorothy Leavell and Sladjana Vuckovic, comprised a majority of the Reader’s board at the time. They approved a resolution requiring the Reader meet several demands before the transition to nonprofit status, which was expected to take

place on Dec. 31, 2021, could continue. Among them: The Reader must make its financial information available and adopt a mission statement saying it “abhors censorship of any kind.”

They also called for Tracy Baim to resign from her role as president and co-treasurer of the newly formed nonprofit’s board. Baim is also co-publisher of the Reader, and has spearheaded its transition to a nonprofit.

“We think that an independent and transparent Reader is just so necessary in this day and time, and we didn’t quite feel it was meeting that test,” said Leavell, who is also publisher of weekly newspaper The Chicago Crusader. “We are not trying to spoil (the nonprofit transition) altogether, but we want to make sure that we do some things to ensure that it will be the kind of

BE

Reader that we had envisioned.”

Eileen Rhodes, who was the third member of the Reader’s board when Vuckovic and Leavell first passed their resolution and is now chairman of the nonprofit entity’s board, voted against their resolution and disputes their concerns. But she said to save the Reader, they agreed to keep Goodman’s column posted on the Reader’s website without any changes and agreed to other concessions.

Still, the impasse remains.

“We’re shocked and disappointed that it has come to this and we have full confidence in Tracy’s leadership,” she said.

The Reader applied for nonprofit status in February 2020 and received IRS approval that fall. The entity that received IRS See READER on Page 20

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 3

JOE CAHILL ON BUSINESS

JOHN R. BOEHM

Spirit-Frontier merger needs a hard look

Marisa Novara is commissioner of the Department of Housing for the city of Chicago.

ARCHITECT OF CHANGE Chicago housing commissioner Marisa Novara is spearheading the city’s most aggressive effort yet to create more affordable housing, while battling segregation and gentrification BY DENNIS RODKIN

I

n fast-gentrifying Pilsen, tension raged for several years over a 7-acre parcel of land that has sat fallow since at least 2004. Beginning in 2015, the site at 18th and Peoria streets was the subject of protests, a lawsuit and other volleys in a battle over how much affordable housing should be included in developments there.

Then, Chicago housing commissioner Marisa Novara announced last December that the city would buy the land for $12 million. When the acquisition is completed early this year, Novara’s department will seek proposals to build up to 280 affordable housing units there.

“I believe fundamentally this is the role of government,” Novara says.

“It’s to be a proactive partner with communities. There’s no reason we should be sitting back and watching when we see we’ve already got a lot of displacement (in Pilsen), loss of the Latino community and loss of affordable housing.”

See HOUSING on Page 18

“I WISH SHE’D DO HER HOMEWORK. I CAN LOOK OUT MY OFFICE WINDOW RIGHT NOW AT THE AFFORDABLE HOUSING THAT WE ALREADY HAVE.” Ald. Nicholas Sposato of the 38th Ward

Hope fades for lawsuits to force ratepayer refunds from ComEd The utility thus far has been successful in getting big-dollar class-action lawsuits related to its admitted Springfield bribery scheme thrown out of court

BY STEVE DANIELS Efforts in court to win customer refunds from Commonwealth Edison for its admitted bribery scheme in Springfield are running out of steam.

A Cook County Circuit Court judge last month rejected the bid by two class-action attorneys to reconsider her decision in December to dismiss their lawsuit.

They have appealed.

In the meantime, both Chicago attorneys—Stephan Blandin of Romanucci & Blandin and Adam Levitt of DiCello Levitt

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Gutzler—are fighting for ratepayer refunds in what is for now the last arena left to them: the Illinois Commerce Commission.

The ICC, which regulates utilities, was empowered in the sweeping clean-energy law enacted last September to probe whether ratepayers should be repaid any of the hundreds of millions collected annually by ComEd and parent Exelon under wide-ranging laws passed as ComEd was engaged in influence-peddling in Springfield. But the authority regulators were given was narrow in

scope—pertaining to money ComEd charged ratepayers that was used directly in furthering its scheme.

Class-action lawyers once saw potential to recover much bigger sums for ratepayers, focusing on the hundreds of millions in annual revenue increases ComEd and Exelon got from the Energy Infrastructure Modernization Act of 2011 (the smart-grid law) and the Future Energy Jobs Act of 2016 (the nuclear bailout).

When ComEd admitted the See COMED on Page 20

A merger that promotes competition and keeps prices in check?

What a concept. Too often, corporate combinations have the opposite effect, especially in the airline industry. After all, many mergers make economic sense only if they reduce competition and boost prices.

Yet we’re told the proposed tie-up of Spirit Airlines and Frontier Airlines is different.

The ultra-low-fare carriers are pitching their deal as the flip side of previous mergers in their industry.

“This is not about reducing competition and raising fares,” Frontier CEO Barry Biffle said on a conference call with Wall Street analysts on Monday. “This is about getting more low fares to more people in more places.”

We’ve heard this kind of talk from airline chiefs before, as they jawboned federal antitrust regulators examining a series of monster mashups that cut the ranks of full-fare carriers in half between 2008 and 2013. They insisted the deals were about serving customers better, not eliminating competition and gaining more pricing power.

Somehow, competition declined as airlines serving many of the same destinations merged.

Some routes turned into monopolies served by a single carrier, leaving travelers no choice but to pay whatever the monopoly carrier charged.

Since the era of giant airline mergers began with the 2008 combination of Delta and Northwest, average U.S. airfares had climbed 8% before the pandemic hit in 2020, according to the Bureau of Transportation Statistics. That deceptively modest increase masks the true extent of airlines’ newfound pricing power. Ancillary fees for services, such as checked bags, assigned seats and flight changes, topped $35 billion in 2018 at the 10 largest carriers, up from $1.2 billion in 2007.

Of course, fares and fee revenues plummeted in 2020, when the pandemic brought air travel to a virtual standstill for months.

Some carriers even suspended change fees.

But fares and fees are rising again as COVID-19 recedes and flyers return. Fee revenue is projected to climb 13% to $65.8 billion globally when final 2021 numbers are tallied.

BTS reports that average fares had climbed 7.6% by the end of the third quarter of 2021 from year-end 2020. Forecasters predict fares will rise another 7% per month through June this year. Locally, BTS data

shows average fares up 8.4% at Midway Airport and 4.9% at O’Hare International Airport.

It’s against this backdrop that Frontier and Spirit will seek antitrust clearance for their $6.6 billion merger, the biggest airline deal since American merged with US Airways in 2013. If approved, the combination would create the fifth-largest U.S. airline.

Like the airline execs who touted previous mergers, Frontier and Spirit bosses argue their deal would benefit the traveling public. It’s about growth, not consolidation, they say; efficiency, not pricing power.

Yes, we’ve heard it before. But there are reasons to believe it this time. Passengers could gain from a bigger, stronger discount rival to dominant players like American, Delta, Southwest and United.

Operating separately, Frontier and Spirit have put pricing pressure on big carriers in some major markets. The relatively low increase in average fares at O’Hare partly reflects their impact at Chicago’s biggest airport.

Frontier also is adding flights at Midway, where Southwest could use some competition.

Together, they would have economies of scale that spread costs over a larger revenue base, which should boost profit margins. In theory, this would allow them to keep fares low while adding flights in new markets.

Expanded discount competition is exactly what U.S. air travel markets need as the industry emerges from the pandemic and major carriers look to recoup lost profits by raising fares and fees.

Even travelers who fly full-fare airlines benefit when healthy discounters are around to keep a lid on prices.

Still, the merger would reduce the number of carriers vying for travelers’ dollars. Two discounters would become one. And a combined Frontier and Spirit would face pressure from Wall Street to deliver on their promise of $500 million in additional annual profits from the merger.

That creates incentive to cut costs and raise prices. Though raising fares might undermine their value proposition as discounters, they’re known for charging steep fees for everything from refreshments to overhead bin space.

Antitrust officials should consider these factors—along with the two airlines’ less-than-stellar customer service and operational records—as they evaluate the merger. Approval should come with conditions—such as restrictions on fee or fare hikes—aimed at ensuring that this airline merger really is different.

2/11/22 3:39 PM

4 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

Big South Loop apartment tower hits the market 2017 and put it up for sale in mid2019, but the property never sold.

The downtown apartment marAfter a couple of sleepy years for apartment sales in down- ket has gone on a roller-coaster town Chicago, the developer of a ride since then, as rents and oc34-story South Loop apartment cupancy fell in the early days of tower is wagering that multifamily the pandemic but rebounded last investors are ready to start buying year. Though demand for downtown rental housing is as strong there again.

Wood Partners has hired the as it has ever been, investors that Chicago office of Jones Lang buy big high-rises have shown little enthusiasm for the LAST YEAR, JUST THREE DOWNTOWN market.

Many investors are APARTMENT BUILDINGS SOLD FOR worried about rising property taxes this MORE THAN $100 MILLION. year after a big jump in downtown assessLaSalle to sell Alta Roosevelt, ments in 2021, brokers say. Landa 496-unit high-rise at 801 S. lords won’t receive their final tax Financial Place, just east of the bills for several months, and the Chicago River’s South Branch. uncertainty over how much they’ll Atlanta-based Wood completed owe has made it hard for investors construction of the building in to figure out how much to pay for

BY ALBY GALLUN

properties. Rising crime downtown hasn’t helped, either.

With apartment investors leery of buying, some buildings listed for sale have been quietly pulled off the market. And many landlords that would like to sell have held off, waiting for a better time. Last year, just three downtown apartment buildings—McClurg Court in Streeterville and the Tides and the Shoreham in Lakeshore East—sold for more than $100 million.

The Alta Roosevelt listing could offer some signals about the market, boosting the confidence of brokers and landlords if it fetches a high price. It’s unclear how much Wood is seeking for the property, which is being sold without an asking price. Wood and JLL representatives did not respond to requests for comment.

Alta Roosevelt is a high-end

COSTAR GROUP

Could the sale of Alta Roosevelt, a 496-unit high-rise that opened in 2017, help wake up the sleepy downtown apartment investment market?

Alta Roosevelt, which has market rent of $2,603 per month, is 95% occupied. building with luxury amenities, though it’s a lot more affordable than properties closer to the central business district, where rents can exceed $4 per square foot per month. Alta’s market rent is $2,603

per month, or $3.29 per square foot, according to a JLL marketing brochure. The building is 95% occupied, according to CoStar Group, a real estate information provider.

BY DENNIS RODKIN Three Chicago homes, each priced at nearly $9 million, recently found buyers without ever hitting the open market, a strong display of the exuberance in the real estate market’s upper end.

On Jan. 13, No. 9 Walton developer Jim Letchinger and his wife, Stephanie, quietly sold their 30th-floor unit in the Gold Coast building for $8.96 million. The private transaction showed up in public records Feb. 3. It’s one of the most in-demand downtown condo buildings since it began delivering super-luxurious units in 2017.

On Feb. 4, a mansion on Orchard Street in Lincoln Park sold for $8.65 million. Its sellers were getting it ready to go on the market when a buyer’s agent approached, according to the sell-

month, went under contract to a buyer Jan. 29 or Jan. 30. The sale price will not be disclosed until the deal closes in March, but given that the home landed a buyer quickly, the final figure is likely to be close to the asking price.

‘POSITIVE REFLECTION’

A run of top-priced properties sold without being marketed is a “positive reflection of the highend real estate market, where opportunities come and present themselves to sellers,” said Susan Miner of Premier Relocation & Real Estate Services. Miner represented the buyers who bought the Letchinger condo at $8.96 million, who she said “wanted to live in No. 9 Walton, which is a testament to what Jim Letchinger built there.”

Miner, who lives in the building, said she contacted the owners of several units, inthe Letchingers, THE DEALS ARE A STRONG DISPLAY cluding whose unit is about 4,700 OF THE EXUBERANCE IN THE REAL square feet with two balconies.

ESTATE MARKET’S UPPER END. Letchinger told Crain’s that although, over the ers’ agent, Janet Owen of Berk- years, he and his wife have lived shire Hathaway HomeServices in a several houses and condos his firm, JDL Development, built, Chicago.

These two became the high- “No. 9 Walton was our dream est- and second-highest-priced building and we planned to stay.” home sales so far in 2022, and When Miner approached him brought the year-to-date total of about this buyer, he said, “my wife city homes sold for $5 million or and I had a family meeting and I convinced her we could move more to six.

A home on Mohawk Street in again.” They’ll purchase a unit at Lincoln Park, priced at just short his next project, the 75-story One of $9 million when it went onto Chicago tower under construca private agents’ network last tion at State and Superior streets.

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The buyers at No. 9 Walton, who purchased the condo through a land trust that conceals their names, will take possession in August, Letchinger said, after he’s moved to One Chicago.

On Orchard Street in Lincoln Park, Owen was “taking photos and having floor plans and marketing done” for her clients’ six-bedroom, 8,400-square-foot home, she said in an email, when “a broker contacted me through word of mouth with a buying client and it all worked out.”

The buyers, who are not yet identified in public records, were represented by Suzanne Gignilliat of @properties.

Built in 1995, the red brick and limestone house is on a 65-by125-foot lot, compared to the city norm of 25-by-125. The sellers, according to the Cook County Recorder of Deeds, are Elizabeth Foster and Michael Walsh, who bought the home in 2003 for a little under $3.4 million and later expanded it.

The house was built by BGD&C, a Lincoln Park custom builder behind several of the biggest Lincoln Park mansions of the past few decades, including a Burling Street mansion that sold for 2021’s highest price of $12.55 million.

The Mohawk Street property is a contemporary home familiar to passersby for its horizontal stripes, both in its orange cladding and metal-banded windows.

Designed by architect Dirk Lohan and built by Metzler Hull, the house is 8,700 square feet with an 1,100-square-foot rooftop deck, four-car garage and elevator.

The home is owned by Harry

A 30th-floor condo at No. 9 Walton in the Gold Coast sold quietly for $8.96 million on Jan. 13.

BERKSHIRE HATHAWAY HOMESERVICES CHICAGO

Two of the homes in Chicago became the highest- and second-highest-priced residential sales so far this year

JOHN R. BOEHM

Three $8 million-plus homes find buyers without hitting the market

On Feb. 4, a mansion on Orchard Street in Lincoln Park sold for $8.65 million.

Seigle, who ran the family owned Seigle’s building materials supply company before it was purchased by a national firm in 2005. He did not respond to a request for comment, and his selling agent, Phil Skowron of

@properties, declined to comment.

Public records do not show what Seigle spent to build the house, which is on an undersized lot—2,856 square feet compared to the 3,125 feet of a standard lot.

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6 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

Loop office properties set for massive loan sale

BY DANNY ECKER The owner of the adjacent Loop buildings that are losing BMO Harris Bank’s U.S. headquarters is set to hand over the properties to its lender, which is now marketing the debt on the buildings for sale and teeing up a likely financial blow to both.

New York-based Union Bank has hired brokerage Jones Lang LaSalle to sell the nearly $191 million loan tied to the office buildings at 115 S. LaSalle St. and 111 W. Monroe St., according to sources familiar with the offering.

The connected 37- and 23-story towers along Monroe Street, between LaSalle and Clark streets, are home to the Chicago offices of BMO Harris as well as law firm Chapman & Cutler, which occupy around 900,000 square feet combined in the properties but are relocating to the recently completed BMO Tower next to Union Station.

With those departures looming and the COVID-19 pandemic fueling record-high downtown office vacancy, it would be highly unlikely that the venture of Seoul, South Korea-based Samsung Life

Insurance that owns the properties would be able to refinance its mortgage. The loan was scheduled to mature in 2020, but Union Bank extended that deadline to this year, according to people familiar with the property. That’s why Samsung is now poised to hand over the keys to the lender, which is likely to sell the loan—and therefore the properties—for far less than the value of the debt, sources said.

OFFICE DISTRESS

If completed, the loan sale could be one of the most dramatic examples of lost value for a Loop office property amid the public health crisis, which has softened demand by setting off the rise of remote work. Companies collectively moving out of offices faster than they are moving in has recently triggered an uptick in downtown office distress, with a handful of foreclosure lawsuits and shrinking bottom lines among many other owners. That pain could worsen this year as more leases expire, especially pummeling older and outdated properties that are losing tenants to newer and higher-quality buildings.

The Samsung venture took out the loan in 2015 to finance its nearly $315 million acquisition of the BMO properties, according to Cook County property records. But the headaches began in 2018 when the bank announced it would leave LaSalle Street for its new namesake tower. Chapman & Cutler followed suit, and the pandemic subsequently crushed whatever long odds Samsung already had to backfill the vacated space.

Samsung has collected an undisclosed amount of net operating income from the buildings since then, and BMO Harris still has multiple lease commitments in place, including a large portion of its space that is leased through 2025, according to research firm Real Capital Analytics. But the ownership venture’s equity in the properties is in line to be completely wiped out.

Union Bank is now trying to recover as much of its investment in the properties as possible, hoping a buyer will come in with a vision to revamp the buildings and pursue new office users or turn them into something else. JLL is playing up the cash flow from BMO

STEPHEN J. SERIO

BMO Harris Bank’s longtime U.S. headquarters stands to be one of the most dramatic examples of lost value among downtown offices during the pandemic

BMO Harris Bank and law firm Chapman & Cutler occupy around 900,000 square feet combined.

Harris’ lease as a valuable source of income in the meantime, sources said.

Spokespersons for Samsung and JLL did not respond to requests for comment. A Union Bank spokeswoman declined to comment.

Despite the ugly pandemic backdrop, buyers have emerged over the past two years for some outmoded, but prominent Loop office properties.

In one gutsy bet, Canadian developer Onni Group last month paid around $166 million for the office building at 225 W. Randolph St. and plans to spend almost as much renovating the mostly vacant landmark to try to bring it back to life.

More recently, Chicago developer Michael Reschke struck a deal with the state of Illinois to buy and revamp the James R. Thompson Center, part of which it would sell back to the state.

One challenge for Union Bank as it looks to unload the BMO properties is that they’re not the only big office building on the block with imminent distress.

The 1.3 million-square-foot tower at 135 S. LaSalle St., immediately south of BMO, is mostly vacant after Bank of America vacated for its own namesake tower on Wacker Drive, and owner AmTrust Realty recently defaulted on its $100 million loan on the property, according to Bloomberg data tied to the mortgage.

Trading firm bulks up on West Loop office space

BY DANNY ECKER Don Wilson’s trading firm has expanded its West Loop headquarters, making room for a Chicago workforce it has beefed up during the pandemic and plans to keep growing with close to 80 more jobs.

Wilson’s DRW Holdings has leased more than 60,000 square feet across two floors at 540 W. Madison St., the company confirmed, a move that brings the company’s total footprint in the building close to 200,000 square feet. DRW added the building’s 28th floor to its existing space on the three floors below and also picked up a portion of the 31-story building’s fifth floor.

The lease completes one of the largest expansions of downtown office space since the start of the COVID-19 pandemic. Many companies re-evaluating their workspace needs with the rise of remote work over the past two years have sought to shrink their office footprints, driving downtown office vacancy to a record high in 2021.

But DRW is part of the crop of companies making statements about their commitment to

P006_CCB_20220214.indd 6

in-person office work and taking advantage of a soft market for landlords.

“While we continue to offer flexibility and autonomy to our teams to work where they choose, we value collaboration and want to provide a great in-office working environment for our teams,” a DRW spokeswoman said in a statement. “We have grown significantly over the last 24 months, both in our core businesses and new initiatives.” By expanding the headquarters, “we are creating additional meeting and collaboration spaces, as well as expanded mother’s suites, cafes and fitness areas,” the statement said.

JOB GROWTH

The spokeswoman declined to share how many employees DRW has in Chicago or detail its local hiring plans, but referred to the nearly 80 Chicago-based job listings on the DRW website as an indication of the firm’s plans.

DRW has around 1,300 employees today, according to its website. That number was close to 1,100 a year ago, according to a Bloomberg report at the time.

Founded by Wilson in 1992,

DRW is well known as one of the biggest high-speed trading firms in Chicago. But the company has expanded its reach into venture capital, cryptocurrencies and real estate. One of its subsidiaries, Convexity Properties, co-developed the new 1.5 million-square-foot BMO Tower that opened last month next to Union Station.

The company’s lease expansion reinforces its position as the second-largest tenant in the nearly 1.2 million-square-foot Madison Street building, only behind anchor tenant Bank of America. DRW’s lease in the building runs through the end of 2029, according to real estate information company CoStar Group.

The building was around 96% leased before the DRW expansion, according to Telos Group, which oversees the property’s office leasing. Wholesale insurance company RT Specialty recently leased more than 83,000 square feet in the building—double its square footage in another West Loop building it is leaving behind—and restaurant technology company Rewards Network inked a deal late last year for

COSTAR GROUP

Don Wilson’s DRW Holdings signals the importance of in-person work with one of the largest downtown office expansions since the pandemic began

DRW Holdings’ footprint will grow to close to 200,000 square feet at 540 W. Madison St. more than 25,000 square feet in the building. The property has been owned by Boca Raton, Fla.based Third Millennium Group since 2012.

The recent leasing run helps fortify Third Millennium’s rent roll at the building at a precarious time for downtown office landlords. It’s still unclear how much more space-shedding is on the way around downtown as more leases expire, and whether new leasing activity will offset those losses.

But the Madison Street property’s success underscores the

relative strength of West Loop offices, which are collectively outperforming several other parts of downtown. Office moveins outpaced move-outs in the West Loop by more than 145,000 square feet during the fourth quarter, according to data from CBRE. Ari Klein and Scott Shelbourne in the Chicago office of brokerage Cushman & Wakefield negotiated the lease expansion on behalf of DRW. Telos’ Jamey Dix and Colton Riemenschneider represented Third Millennium Group.

2/11/22 3:23 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 7

Morningstar considers move to Marshall Field building

BY DANNY ECKER Morningstar is poised to leave behind its longtime Loop headquarters for a new main office downtown, a move that would complete one of the city’s biggest new office leases since the start of the COVID-19 pandemic.

Where the investment research firm lands is still to be determined, though people familiar with the company’s search said it is closely eyeing as much as 250,000 square feet at the redeveloped upper floors of the Marshall Field building in the Loop, just steps from its current home at 22 W. Washington St. The company is one of the city’s largest and best-known tenants to be searching for a new office amid the public health crisis, making its decision on where to go—and how much space it needs—closely watched among downtown office landlords grappling with soft demand and near record-high vacancy.

Morningstar has been quietly hunting for a prospective new headquarters location for nearly three years and was initially exploring several options, including anchoring a new Fulton Market District project. The company has also

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mulled staying put in the Block 37 building it has called home since 2008 and where its lease expires at the end of next year, according to people close to the search.

But its departure for a new home appeared more likely last month when its current landlord, a venture of Newark, N.J.-based PGIM Real Estate, began marketing Morningstar’s 263,000-square-foot block of offices as available to new users beginning in January 2024.

Sources said Morningstar has not finalized a new lease in another building and the company could opt to extend its lease at its current home, but the listing is a sign that Morningstar is on its way out.

Morningstar spokeswoman Stephanie Lerdall said in a statement to Crain’s that the company “always undertakes a rigorous real estate evaluation process when we approach the end of an office lease term. For our space in Chicago, our evaluation of options—including our existing location—includes criteria we believe is essential to developing the Morningstar employee experience of the future.”

The statement added that the “evaluation process is not yet complete.”

A PGIM spokesman did not re-

spond to requests for comment.

If Morningstar inks a deal to relocate to 24 E. Washington St. and the revamped floors above Macy’s State Street flagship store, it would score a major victory for Brookfield Properties, the Toronto-based developer that transformed the space in the landmark building into modern offices. It would also stand out as a big recommitment to in-person office work against a backdrop of rising remote work and companies rethinking their workspace needs.

TOUGH TIMING

Brookfield completed its redevelopment as the pandemic set in, making it a tough time to be hunting for tenants. But new and recently renovated properties like it have weathered the pandemic better than others as companies seek out offices that will help compel employees to work in person.

Morningstar would become the 650,000-square-foot office block’s anchor tenant, joining a roster that includes the headquarters of online ticket marketplace Vivid Seats and consumer-insights company Numerator. New York-based Industrious also operates co-working space in the building.

COSTAR GROUP

An exit from its longtime headquarters at Block 37 would complete one of the most closely watched Chicago office searches since the COVID pandemic began

Morningstar’s headquarters has been at 22 W. Washington St. since 2008.

A Brookfield Properties spokeswoman did not provide a comment.

Morningstar helped jump-start development of the office portion of the Block 37 mixed-use development in 2005 when it inked a 15-year deal to anchor the 17-story building, slated at the time to be at the address of 108 N. State St. Losing Morningstar would create a new leasing challenge for PGIM, which paid $182 million in 2011 for the office property, according to Cook County property records. The property is 100% leased today, according to real estate information company CoStar Group, but Morningstar occupies close to 60% of the building. The vacancy would be the first major test the property has ever faced to

backfill a big block of office space.

Television network CBS is the property’s second-largest tenant, with a lease for 112,000 square feet that runs through May 2033, according to CoStar.

Morningstar has grown its headcount dramatically since it first moved into the building, though much of its expansion under CEO Kunal Kapoor—who succeeded founder Joe Mansueto in the role in 2017—has been in other markets through company acquisitions. Morningstar had about 1,700 employees based in Chicago as of mid-2020, down slightly from the year before. The company had nearly 8,000 employees globally as of February 2021, according to its most recent annual report.

2/11/22 3:20 PM

8 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

Frontier-Spirit merger’s impact on O’Hare, Midway

The combined carrier will be a stronger competitor with possibilities for growth, but it will have to sort out disparate operations at the city’s two airports Frontier and Spirit, two of the discount airlines serving Chicago, are merging, and that’s likely to mean they’ll grow here.

Together they’ll be stronger and likely inclined to grow in Chicago over the long term, says Joe Schwieterman, an aviation expert at DePaul University.

“Both carriers are seen as niche offerings,” he says. “The combined carrier will give them more brand recognition. Look at how EasyJet is a household name in Europe. I think we’ll potentially see more flights from Chicago to the Caribbean and to Mexico.”

Spirit and Frontier both serve O’Hare, but they operate from different locations. Spirit is at Terminal 3, while Frontier is at the international terminal, Terminal 5. Frontier is in the process of shifting much of its flying from O’Hare to Midway in April. After

If Frontier remains at Midway, the combined carrier would be better positioned to compete with Southwest Airlines. However, Southwest dominates Midway with more than 90% of the flights.

“I think there are possibilities at Midway,” Schwieterman says.

“Frontier has a foothold now, and the public is eager to have options other than Southwest.”

SMALL FISH, BIG POND

Spirit and Frontier are relatively small players at O’Hare, with a combined schedule of about 25 flights a day, according to city data. By contrast, United Airlines is operating about 400 flights a day, and American Airlines has just over 300 daily flights.

The combined airline will be the fifth-largest U.S. operator, with about $5 billion in revenue. That’s still a fraction of the major carriers, such as United, which had $25 billion in revenue last year. Fron“SIZE WILL GIVE THEM ADVANTAGES IN tier says it plans to grow, though IMPROVING THEIR SERVICE QUALITY. it didn’t lay out detailed plans for THEY’RE STRETCHED PRETTY THIN.” specific markets.

Joe Schwieterman, DePaul University aviation expert The company did say that the deal the move, it will serve Orlando, “creates the ability to succeed in Fla.; Cancun, Mexico; the Do- cities it previously exited, such minican Republic; and Puerto as Jackson, Miss.; Washington, D.C.; and Birmingham, Ala.; and Rico from O’Hare.

The two airlines likely would opportunities to add additional want to operate from the same small cities, such as Eugene, Ore.; Ithaca, N.Y.; and Worcester, Mass.” terminal, Schwieterman says.

Executives expect the carri“It’s too early to discuss changes to their operations at O’Hare,” er will be more efficient, which the Chicago Department of Avia- could allow it to add flights. “(The merger) enables our tion said in a statement.

BLOOMBERG

BY JOHN PLETZ

The combination of Frontier and Spirit will create the fifth-largest U.S. airline operator, with about $5 billion in revenue. ability to take the scarce resources that we do have to provide more flights on each gate. A combined entity will have one of the highest gate utilizations of any carrier in the United States,” Frontier CEO Barry Biffle told analysts Feb. 7.

The merger also could help smooth out some of the severe weather-related disruptions suffered by carriers, such as storms last summer that crippled Spirit.

“With their combined operations, they’ll have more flexibility,” Schwieterman says. “Size will give them advantages in improving their service quality. They’re stretched pretty thin.”

The two airlines don’t have a lot of overlap, so the combination is unlikely to result in ser-

vice cutbacks, “This is not the same as Delta and Northwest merging,” says Mike Boyd, president of Boyd Group International, an aviation consultant in Evergreen, Colo. “It’s putting overhead together. The biggest change is there will be one less paint job on the airplane ramp.”

Frontier says the $2.9 billion merger will result in about $500 million in annual savings and revenue for the combined company.

Frontier and Spirit face increased competition for leisure travelers from carriers such as United and Southwest because it’s the strongest part of the aviation market right now.

The number of passengers at U.S. airports remains down 20%,

according to the Transportation Security Administration. Corporate travel remains depressed, though it has picked up recently, airline executives said.

The Spirit-Frontier merger would be the first in the U.S. since Alaska Airlines bought Virgin America in 2016. Despite increased antitrust scrutiny by the Biden administration, Cowen analyst Helane Becker predicts the deal will be approved.

“We think the two companies will be able to compete more aggressively with the larger airlines once they combine,” she wrote in a note to clients. One key benefit is hiring. Facing a wave of retirements in the coming decade, airlines are scrambling to hire record numbers of pilots.

Crain’s names new execs in sales, marketing and more in editorial, marketing and custom publishing to deliver compelling content, professional development and networking opportunities to Crain’s audience.

Crain’s Chicago Business is expanding its leadership team.

Sarah Chow has been promoted to sales director at Crain’s Chicago Business. In her new role, Chow will oversee all sales efforts at the publication and will work with key colleagues in editorial, events, marketing, custom and research to build on Crain’s strong reputation in the Chicago marketplace as the best place to reach local leaders, executives and investors with advertising and marketing messages.

Chow joined Crain’s in 2005, first serving as marketing manager before moving into sales as a senior account executive in 2009 and being promoted in 2019 to director of custom publishing.

Elizabeth Couch has been promoted to director of audience and engagement for Crain’s Chicago Business as well as its sister publications in New York, Detroit and Cleveland. In her new role, she

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Sarah Chow

Elizabeth Couch

will work closely with the editorial leads in each market to elevate each newsroom’s journalism across all digital platforms and will also coordinate with Crain Communications’ core marketing team.

Couch joined the company in 2021 as a digital editor for audience at Crain’s Detroit Business. She was previously director of communications for the State Bar of Michigan, and before that spent six years at the Chicago Tribune, ultimately serving as director of audience.

In that role, she oversaw a team of

Kevin Skaggs

Christine Rozmanich

editors working to grow and retain readership.

Kevin Skaggs has been promoted to vice president of product for Crain’s city publications. While taking on this new role, Skaggs will also continue to head product and digital for Crain’s sister publication Ad Age. Skaggs joined Crain Communications in 2013, first serving as general manager for digital and then general manager of product and technology several years later. In

Cody Smith

these roles, Skaggs continually supervised web operations at Ad Age, driving product improvements across the brand’s digital properties and working across teams to help grow audience and revenue.

Christine Rozmanich, an account executive at Crain’s Chicago Business since 2018, is now also manager of the publication’s events business. In that role, Rozmanich is responsible for coordinating Crain’s in-person and online events, working with teams

Cody Smith has been named marketing manager of Crain’s Chicago Business. In his new role, Smith will be responsible for conceptualizing and executing internal and external marketing campaigns. Prior to his current post, Smith was marketing manager at Crain’s Cleveland Business.

“I’m extremely excited about the dynamic leadership team we have in place both at Crain’s Chicago and the other Crain’s city brands in New York, Cleveland and Detroit,‘’ said Jim Kirk, group publisher. “With the talent we have in place, we are in a great position in our markets to take advantage of the changing media landscape and drive additional value for our subscribers and marketing partners.”

2/11/22 3:19 PM

CRAIN’S Crain’s Academy

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10 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

EDITORIAL

LaSalle Street needs a moonshot-style plan WHAT NEW USES MIGHT THERE BE FOR A STRETCH OF GRAND BUT OUTDATED URBAN REAL ESTATE STEADILY LOSING OFFICE TENANTS TO THE GLASS-ANDSTEEL TOWERS OF THE WEST LOOP AND BEYOND?

JOHN R. BOEHM

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ou’ve heard the boiling-frog analogy enough times that you get the gist: We humans tend to accept things that creep up on us slowly—and then one day we wake up and find ourselves in a bubbling cauldron.

New reporting by Crain’s Danny Ecker represents a boiling-frog moment, where a long-standing simmer suddenly feels very much like a rolling boil. He reports that the owner of BMO Harris Bank’s U.S. headquarters is handing over the keys to its lender, New York-based Union Bank.

Union Bank, for its part, is now hoping to sell the nearly $191 million debt on the adjacent buildings at 115 S. LaSalle St. and 111 W. Monroe St. as its two premier tenants, the Chicago offices of BMO Harris as well as law firm Chapman & Cutler, decamp to the recently completed BMO Tower next to Union Station.

Ecker’s Feb. 7 report follows closely on the heels of a more comprehensive Feb. 3 story warning that expiring leases are now draining revenues for office landlords— and that means more property owners are struggling to make mortgage payments.

More foreclosures, therefore, are likely to pile up on top of the suits that have already been filed at Central Loop locations like the Civic Opera Building and the office portion of 208 S. LaSalle St. Meanwhile, landlords at 300 W. Adams St. and 65 E. Wacker Place simply handed their property deeds to their lenders late last year rath-

er than face a legal battle over their loans.

Those examples illustrate that the downtown office market’s pain is certainly not isolated to BMO Harris’ home in the LaSalle Street corridor, but it’s clear the disruption is most intense there. Even before the pandemic, Crain’s has been chronicling the identity crisis facing a thoroughfare es-

tablished as the core of Chicago’s financial district. The question that’s loomed over the LaSalle Street canyon like the statue of Ceres atop the old Board of Trade Building is this: What new uses might there be for a stretch of grand but outdated urban real estate steadily losing office tenants to the glass-and-steel towers of the West Loop and beyond?

Ideas have percolated here and there: Hotels? Condos? Rehabbing these spaces with smaller floor plates into tech hubs and co-working joints? All have merit here and there, but what’s lacking—and very much needed—is a comprehensive plan. Chicago needs to think big about what the old financial district can and should be next.

And it’s a question that shouldn’t be left to landlords and their lenders alone. Everyone in the city has an interest in keeping the core of the downtown business district busy and relevant.

In short, we need a moonshot-style idea for LaSalle Street. We can’t allow the very core of the Loop to turn into a row of white elephants.

The Lightfoot administration has rightly focused much of its economic development effort on the West and South sides via its Invest South/West program. But her team can and should also look right outside City Hall’s doorstep and recognize need to give the Loop a shot of life. As we emerge from the COVID crisis, there’s an opportunity for some big-bang thinking.

A median that sports green space? A more pedestrian-friendly streetscape? A university presence of some sort? We don’t have all the answers, but there are enough people in Chicago with the design, development and investment smarts to concentrate their efforts on such a plan. What’s needed next is the leadership to make that planning happen.

T

Threats against health care workers must end not new, reports of verbal and physical abuse by white supremacists attacking the personal characteristics of health care professionals from historically and racially marginalized groups represents a deeper layer of racism.

Early in the pandemic, the AMA warned that xenophobic language around SARS-CoV-2 threatened to further fuel discrimination and hate crimes specifically against Asian Americans, which were already a significant concern due to long-standing interpersonal and structural racism.

But as researchers have pointed out, while general workplace violence across health care is well-documented, such incidents rooted in racism like the one recently in Boston are too often decontextualized and classified as “disruptive” rather than racial violence. This, the authors tell us, “represents a violent avoidance, silence, and complicity to the insidious nature of white supremacy, which is deeply embedded in the structure and culture of medical institutions.”

COVID-19-related violence against physicians has also translated to the digital world, with recent surveys indicating that at least one-quarter of reporting U.S.

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Chicago Business, 150 N. Michigan Ave., Chicago, IL 60601, or email us at letters@chicagobusiness.com. Please include your full name, the city from which you’re writing and a phone number for fact-checking purposes.

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YOUR VIEW

environment across medicine, he AMA has advocated particularly for those on the against the culture of viofront lines of our nation’s relence in America, includsponse to COVID-19. ing domestic violence, gun vioResearch confirms what our lence, racism, police brutality personal experiences have and xenophobia—and violence long told us. The World Health against physicians and health Organization estimates that as professionals is no exception. many as 38% of those in our While not a new occurrence, field suffer physical violence the reported uptick in intimidaat some point in their careers, tion, threats and attacks toward and many more are threatened people in the medical field has Gerald E. Harmon, with verbal aggression. Here been on the rise for at least the M.D., is president of in the U.S., injuries caused by last decade—and has become the Chicago-based violent attacks against medical even more of an alarming phe- American Medical professionals grew by 67% from nomenon since the beginning Association.

2011 to 2018—with health care of the COVID-19 pandemic.

The AMA believes when it comes to workers five times more likely to experience health care, physicians’ voices should be workplace violence than workers in all oththe loudest in the room—and we make it er industries, according to figures from the U.S. Bureau of Labor Statistics. happen every day.

Yet another global study from 2020 found The recent neo-Nazi protest against leading anti-racist physicians at a Bos- that health professionals were roughly 50% ton-area hospital is yet another sad chap- more likely than other community memter in the long history of threats and intim- bers to have been harassed, bullied or hurt idation of health care workers for simply as a result of the COVID-19 pandemic. carrying out the duties of our profession.

The AMA is deeply concerned about this RACIALLY MOTIVATED VIOLENCE ON RISE threatening behavior and how it has conEven more disturbingly, though racialtributed to an increasingly hostile working ly and ethnically motivated violence is

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physicians having experienced attacks or harassment on social media on topics such as vaccines, guns, patient care, race or religion. Another survey found that physicians reported experiencing not just verbal abuse but death threats, including a harrowing incident specifically cited where a Black woman physician reported being threatened with rape as a result of her work in civil rights advocacy.

Simply telling our colleagues in medicine to cope with harassment and menacing behavior is unacceptable. It is imperative that physicians and health professionals feel safe and secure, whether we’re caring for patients or working to advance equity on a broad scale in our communities.

Vice

WE MUST PROTECT THOSE WHO HEAL

Keith

The AMA strongly believes that people in all workplaces have the right to a safe environment, out of harm’s way and free of any intimidation or reprisal. Society needs to protect its citizens from individuals or groups that encourage and advocate violence as a means for resolving deep social issues. While it’s clear that more work is needed to curb the incidence of violence against the medical profession, AMA policy puts us on this path to protecting the

Sound off: Send a column for the Opinion page to editor@ chicagobusiness.com. Please include a phone number for verification purposes, and limit submissions to 425 words or fewer.

2/11/22 3:06 PM

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 11

YOUR VIEW Continued very people who devote their lives to improving the health of their patients—and the nation.

For example, in light of ongoing attacks on physicians and public health officials during the COVID-19 pandemic, the AMA adopted policy in 2020 aimed at improving the safety of—and condemning acts of violence against— physicians, health professionals, first responders and public health officials in society. This position joins a host of previously adopted policies aimed at preventing violent acts against health professionals, addressing workplace bullying in the practice of medicine and standing up against online bullying or harassment.

Notably, the AMA’s recognition of racism as a public health threat is part of an upstream solution to confront our nation’s legacy of structural racism and acknowledge

ly pes er tze e n g. re i’t h ln’s at

Creative director Thomas J. Linden

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care workers can speak openly and honestly about the real-world threats they encounter in the workplace and come up with sensible solutions to protect our peers and our patients.

Violence has no place in the medical profession, and so we as individuals and as leaders in organized medicine have a responsibility to do whatever we can to prevent it from occurring inside and outside of the workplace. This is important for the health and well-being of everyone working in medicine today, but particularly for those who have been historically marginalized.

The steps we take today to create a safer and more inclusive environment for all physicians will, in turn, create a safer and more welcoming environment for our patients— and our best chance to advance equity and improve the health of the nation.

CHICAGO BUSINESS

Chief executive officer KC Crain

e eat el or a

directed at physicians and health care workers by patients or community members.

Security and safety response protocols to protect physicians and other health care workers to ensure their freedom from hatebased violence and intimidation.

Solidarity-based strategies to mobilize individuals and organizations, across the health care ecosystem, to name, confront and effectively resist hate-based violence and intimidation.

Our AMA is actively monitoring this situation to consider how we can better leverage our strengths and resources to promote the collective safety and security of all health care workers and organizations under attack for championing equity and justice for their patients and communities.

We all have a role in helping to create an environment where physicians and health

CRAIN’S

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the subjection of Black and Brown people to acts of violence, including violence in and out of medical settings.

The AMA remains committed to taking the necessary steps to help shed light on the various protocols, procedures and mechanisms to ensure a safer and more secure environment for physicians and health care professionals. But we can’t do it alone.

Health care organizations, including hospitals, health systems and independent practices, should work collaboratively to share best practices for effective violence prevention strategies in and out of health care settings. Examples of where further work is needed to develop best practices and widespread adoption include: The development of robust surveillance and data collection systems, technologies, and standards to track hate-based violence

NOMINATION DEADLINE EXTENDED!!

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RESIDENTIAL REAL ESTATE BROKERS Crain’s 2022 Notable Real Estate Brokers will recognize top Chicago area real estate brokers for their success and accomplishments during the last 18 months.

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People on the Move manager Debora Stein Project manager Joanna Metzger Digital designer Christine Balch CRAIN COMMUNICATIONS INC. Keith E. Crain Chairman Mary Kay Crain Vice chairman KC Crain Chief executive officer Chris Crain Senior executive vice president Robert Recchia Chief financial officer Veebha Mehta Chief marketing officer G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996)

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2/11/22 3:06 PM

12 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

YOUR VIEW

Growing without forcing out longtime residents? Woodlawn shows it can be done.

We see Woodlawn’s experience as a model of how to create the diverse communities that truly provide opportunity for all

A

lthough construction of the Obama Presidential Center is underway and ordinances intended to ensure diversity have been passed, neither the fears nor the debate over the impact of this megadevelopment on adjacent neighborhoods appear to have diminished.

For as much as the OPC investment heralds possible economic growth, it also raises concerns about gentrification and displacement of longtime residents. However, to view the future as a binary choice— revitalization or preservation—overlooks a third pathway, based on past experience: that of driving growth, while also protecting and expanding opportunities for all.

Over the past decade, Woodlawn has experienced some of the strongest development and growth of any community on the South Side, without significant displacement—an accomplishment that suggests a path for balanced growth.

Filling a demand for new housing in this lakefront community, KMW Communities, an African American-owned for-profit entity, and other local developers have built and sold homes for as much as $700,000— prices unheard of here not so long ago. At the same time, the Preservation for Affordable Housing, or POAH, and other rental housing developers are balancing the equation by protecting and expanding affordable homeownership and rental options.

This includes dozens of homes restored and sold affordably and the more than 700 rental apartments POAH built and rehabbed to replace the former Grove Parc Plaza Apartments, as well as its recent purchase of the 240-unit Island Terrace Apartments located directly across from the OPC.

Bill Eager is senior vice president, real estate development, Midwest region, for Preservation of Affordable Housing.

Bill Williams is the principal at KMW Communities, which develops market-rate and affordable for-sale homes. Both firms have worked in Woodlawn for more than a decade.

In fact, rather than presenting a threat, we see Woodlawn’s experience as a model of how to create the diverse communities that truly provide opportunity for all—a model whose value we hope will be independently confirmed by a Case Western/ University of Illinois study of Woodlawn, slated for release in mid-February.

Following decades of disinvestment, over the last 10 years, Woodlawn has also attracted significant commercial investments, providing residents with new amenities, fresh-food options and jobs—to date, POAH and other developers such as DL3 Realty have built 90,000 square feet of new retail and community spaces a mile west of the OPC, anchored by a new Jewel-Osco grocery store—with more on the way.

The Obama Presidential Center provides an unprecedented opportunity to build on Woodlawn’s assets and the experience of the past decade without fear of displacement—through wise stewardship of available land.

Because 200 or more vacant parcels of land in Woodlawn are owned by the city of Chicago, we have an opportunity to shape development—economic growth and affordability—through wise public policies and a prudent strategy acknowledging that real equity and equality include a commitment to growth.

Abundant land, strong demand for housing, unrivaled access to transit and proximity to one of the nation’s premiere universities set the stage for the repopulation of Woodlawn across the income spectrum—homeowners and renters, long-time residents and newcomers alike.

Some of that planning is already in motion. The Chicago Transit Authority has begun to redo the Green Line Station at 63rd Street and Cottage Grove Avenue to make it a hub of economic and residential activity.

As important, community leaders have long been focused on Woodlawn’s future.

The Network of Woodlawn and 1Woodlawn organizations, for example, are critical forums for balancing the need for growth with the need to accommodate existing residents.

Our experience and discussions with neighborhood leaders and residents make clear that Woodlawn residents want both economic growth—new homes, new stores, a revitalized 63rd Street—and pro-

tections for lower-income residents, resulting in a neighborhood that is diverse economically and racially.

What is needed in Woodlawn varies. In East Woodlawn, close to the University of Chicago and OPC, the private market is primed toward higher-end homes and condominiums. Here, preserving as many affordable properties as possible is critical to a balanced community, and sales of city-owned land can leverage new affordable units to complement market activity.

West Woodlawn’s story is more mixed.

On some blocks, newly built homes are priced in the $500,000 range, but activity is spotty. Nevertheless, hundreds of publicly owned parcels can be targeted for moderate-income home sales through such vehicles as Renew Woodlawn, which uses a variety of public funding sources for affordable homeownership.

63rd Street, running east-west through the heart of Woodlawn, may be the centerpiece for continuing growth. Most, if not all, of the vacant land running 1.5 miles from Stony Island to King Drive is owned by the city, creating the opportunity for a public debate about its development. Getting an underdeveloped 63rd Street right, including the transportation node at its center, can open more opportunities and knit Woodlawn more closely together along a vibrant corridor.

Like the OPC, which is just getting underway, Woodlawn is a work in progress.

Its future, too, is being built right now.

And with the right public policies and private actors, that future holds the opportunity for growth that serves all of its residents.

A baseball writer’s conundrum: Casting Hall of Fame votes in the post-’roid era Absent any guidance from Hall leadership, the whole process is rife with hypocrisy

I

f this was the last year on the Baseball Writers Hall of Fame ballot for Barry Bonds, Roger Clemens, et al., it might also be this former baseball writer’s last year as a Hall voter. And I’m fine with it.

I’ve been a Baseball Writers’ Association of America member since 1982 and a Hall voter since 1992, but my status has been “honorary” since some occasional freelance coverage ended in 2019. Most “honorary” folks lose their vote after a certain period of inactivity, the theory being that they’ll no longer attend enough games to form credible judgments.

I still go to lots of games on both sides of town, but a duty I long regarded as an honor and a privilege no longer holds much fascination. I’m feeling less and less comfortable passing judgment on who allegedly did what during baseball’s steroid era, for which Bonds, Clemens and Mark McGwire serve as poster boys.

And, absent any guidance from Hall

Dan McGrath is president of Leo High School in Chicago and former Chicago Tribune sports editor.

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leadership, the whole process is rife with hypocrisy.

The joyride that was David Ortiz’s career ends with first-ballot passage to Cooperstown, despite a New York Times report implicating the beloved Big Papi as a PED user in 2003, the year MLB tested everyone in order to justify the need for a testing program.

Sammy’s Sosa’s inclusion in the same report is the only real evidence linking him to PEDs, but His Samminess’ Hall candidacy has never gone anywhere . . . not that it should.

That $5-haircut look Bud Selig always favored might have come from keeping his head in the sand—until his friendly neighborhood pharmacist clued him in, the Commish didn’t know nothing about steroids, even in 1996, as a formerly wispy, slap-hitting outfielder named Brady Anderson was hitting more home runs (50) than Bud’s buddy Henry Aaron ever hit in a season.

Bud Selig, though, is in the Hall of Fame.

Tony La Russa was malevolently mute as Oakland A’s Bash Brothers McGwire and Jose Canseco were morphing into

Muscle Beach freaks in the late ’80s. La Russa broke his silence once—to excoriate Washington Post writer Tom Boswell for reporting it was known around Miami that hometown slugger Canseco’s Adonis-like physique was store-bought, a fact Canseco would shamelessly confirm in a bizarre tell-all identifying dozens of fellow users.

Canseco became a baseball pariah. La Russa went to the Hall of Fame.

Speaking of pariahs, Pete Rose retains his status, even with baseball in such thrall to gambling that the Rickettses are lobbying to get a sportsbook installed at Wrigley Field.

True confession time: Didn’t vote for the ’roid guys, never once, not any of them, including Big Papi. Except I don’t really know who they are, so let’s go with so-called ’roid guys.

Bonds, no doubt, belongs on the all-churl team with Ty Cobb and Cap Anson and the other social reprobates whose presence in Cooperstown has often been cited to dilute the case for keeping Rose out.

Bonds is also the best player I saw in 20-plus years as a professional observer,

likely first ballot if he’d never touched the stuff. But if grand jury testimony isn’t convincing-enough proof that he did, how about his evolving from a 190-pound slot receiver into a 260-pound defensive end during his last eight years in San Francisco.

Couldn’t bring myself to vote for Barry.

I say this as one of those baseball nerds who was drawn to the game by the magic of the numbers and records that underscore its fascinating history. Timeless history, until chemistry intervened.

Seventy-three home runs in a season?

Fifty by a guy who’d hit 64 over his previous five seasons? The sluggers who bulked up to Macy’s parade-float mass made a mockery of those records. Voting no on them is the stand I’ve taken, but it gets harder to justify when hypocrisy stains the process.

Is it an authentic Hall of Fame, a true museum of baseball history, without the best hitter and best pitcher of their era?

That’s for some future Veterans Committee to decide. Bonds and Clemens should pray for the one that enshrined Harold Baines. They’ll breeze right in.

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 13

FUNNELING FUNDING: Financial institutions act on pledges to support Black busineses. PAGE 15 NO MORE STATUS QUO: In North Lawndale, economic creativity takes on new forms. PAGE 16 SCALABLE IMPACTS: Corporations and others must make good on their promises. PAGE 17

CRAIN’S CHICAGO BUSINESS COMMUNITY DEVELOPMENT

AN ELUSIVE PATH TO GEOFFREY BLACK

PROSPERITY Collete English Dixon is executive director of the Marshall Bennett Institute of Real Estate at Roosevelt University.

Systemic bias steers minority professionals to community development rather than the more lucrative commercial real estate and private-equity fields | BY JUDITH CROWN George Floyd’s murder propelled some of the nation’s largest banks, foundations and investors into taking action on calls for racial equity. They subsequently pledged billions to restore long-disinvested neighborhoods on Chicago’s South and West sides through mortgage lending, small-business assistance and commercial development.

The awakening promises to jump-start community development, a complex ecosystem that mixes commercial real estate and small business, and includes developers and entrepreneurs, banks, community development corporations, tax credit syndicators and community development financial institutions, or CDFIs, the nonprofits that provide credit and financial services to underserved markets.

Who are the players to revitalize depressed neighborhoods? Is community

development in itself diverse? Data is difficult to come by. Anecdotal evidence suggests there are pockets of diversity, with minority representation petering out closer to the primary sources of capital.

Community development has provided good-paying jobs to minority professionals at banks and nonprofits, such as CDFIs. But can it build broader breakout generational wealth, which is mostly possible at the developer level? And are there even enough people of color in those developer ranks to carry out the work?

With access to capital such an impediment, large numbers of minority developers and entrepreneurs aren’t lining up to rebuild the neighborhoods, experts say.

Community development has proven lucrative for white investors and middlemen, such as syndicators, who make

a market for tax credits, experts say. But they wonder whether it’s helping people who are in the disinvested neighborhoods, because conditions haven’t improved and often, they are worse, with wealth in the hands of fewer people.

“The programs haven’t moved the needle,” says Collete English Dixon, executive director of the Marshall Bennett Institute of Real Estate at Roosevelt University.

On the lending side, minority professionals have gained positions of influence with mastery of the elements of the Community Reinvestment Act of 1977, the world of tax credits and arcane IRS rules. These executives say they are mission driven, aiming to give back to their communities. But systemic bias directs people of color to community development rather than the more lucrative sectors of commercial real estate

and private equity.

“I’ve been on the market-rate side for two decades, and when I go to (real estate) conferences, I don’t see too many faces that look like mine,” says Jerry Lumpkins, Chicago commercial real estate lead executive at Bank Leumi USA, who is biracial. “Folks bring in people that look like themselves.

Even though real estate is big, it’s close knit, like a private club. You have to know the right people, have the right mentor, the people that will open doors for you. When that doesn’t happen, you get more of the same.”

“Still, there’s reason for optimism postGeorge Floyd, as long as lenders and investors stay true to their commitments,” English Dixon adds. “And everyone must have patience because these things take time.”

See ELUSIVE on Page 14

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14 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

CRAIN’S CHICAGO BUSINESS

ELUSIVE Continued from Page 13

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GEOFFREY BLACK

IT’S HARD TO GET RICH

The legacy of slavery and Jim Crow as well as discriminatory practices, such as redlining, barred Black families from building wealth.

The painstaking work of development is difficult on the South and West sides because many of the residents, largely Black and Latino, often lack family wealth and access to the capital to jump-start a project.

White GIs returning from World War II received loans to build homes in the suburbs, while the loans for Black GIs went to innercity mortgages, notes Torrence Moore, senior director at the Chicago office of the Local Initiatives Support Corp., a national CDFI. “Fast forward, those loans in suburbs appreciated more than homes in the inner city,” Moore says. Minority developers from the city may be offered SBA loans, which require borrowers to assign their home as collateral. “They want your firstborn,” he says.

Without money in the bank, minority developers will be directed to community development, where there is a lower barrier to entry and the possibility of gaining tax credits or grants, executives say. But it’s difficult to get rich this way.

Much of the development on the South and West sides is undertaken by Black or Hispanic operators investing in six-flats, says Stacie Young, CEO of Community Investment Corp., a CDFI that finances unsubsidized affordable rental housing. A typical client is a maintenance manager from Beverly, who rehabs a building in Auburn Gresham to the tune of $60,000 per unit and is not mission driven, she says.

“Everyone had taken them for granted,” Young says. “Now more resources are being opened up.” But they’ve struggled during COVID, with some tenants not paying rent. Will they be the ones to capitalize on the opportunities and make an impact?

More ambitious commercial projects require complex capital stacks that include traditional bank loans, tax credits, government aid and foundation grants.

Amassing the funds can take two or three years, if not longer. “Who has the time to do that if you’re not making money on anything else?” says English Dixon.

Well-capitalized real estate firms have multiple developments going on at one time, using income from one project to fund the next. Even when capital is available to a developer, the terms can be onerous and risky. Full recourse loans give lenders the right to pursue the personal assets of borrowers, including their home, in the event of a default.

The redevelopment of Pullman, which is considered the area’s biggest success, took more than 10 years and involved a $110 million investment by U.S. Bank, including the donation of more than 16 acres of land.

English Dixon says it’s good to have a sponsor like U.S. Bank,

Calvin Holmes is president of the Chicago Community Loan Fund, a nonprofit community development financial institution, or CDFI. but will you get that same kind of sponsorship for Woodlawn or Englewood? “There are multiple pieces you have to put together,” she says. “The timelines make it difficult to make a ton of money.”

“There are no more than five minority developers actively pursuing high-impact commercial developments in our neighborhoods,” says developer Leon Walker, known for his landmark shopping center in Englewood that includes a Whole Foods, Starbucks and Chipotle.

Walker was the first Chicago developer to use tax credits for new construction and has made use of other subsidies, but adds, “Our communities are starved for private equity—the missing key that unlocks the door to prosperity.”

Developer Bill Williams dreams of building major transformational projects, but says he’s often directed to less ambitious deals, such as small-scale residential projects.

“You need a balance sheet coupled with patient capital to match the opportunity,” he says. “My counterparts with bigger balance sheets are doing bigger deals. And the wealth gap gets bigger.”

WIDENING THE CIRCLE

The Community Reinvestment Act of 1977 requires financial institutions to meet the credit needs of the communities in which they do business, including low- and moderate-income neighborhoods.

But neighborhood projects don’t offer the chance to finance trophy buildings that make it onto magazine covers. It takes about as much effort to underwrite a $100,000 loan as a $1 million loan, executives say.

Big loans for projects generate big fees and deposits, which pave the way for bigger bonuses.

“It takes a special kind of person to be in community development,” says Lumpkins of Bank Leumi, who handles market-rate apartments and some commercial projects. “It’s almost like a calling.”

Bankers on the community

development side of the business may lack the bonus opportunities of the market-rate side, but still can earn salaries in the hundreds of thousands. “You can make a good living, raise a family at a commercial bank,” says Moore, who held positions at First Chicago, LaSalle Bank and Bank of America. “At the vice-president level, there’s salary, bonus and stock options. It’s just not as plentiful as other areas.”

Community development was more diverse in the 1980s and 1990s, when banks were locally owned and there were Blackowned institutions as well, says Pamela Daniels-Halisi, managing director of community lending at BMO Harris Bank.

“We could focus on neighborhoods,” Daniels-Halisi says. “Following years of bank mergers, banks are larger and the footprint is multistate. You can’t have the same focus on a particular neighborhood. The work is dispersed.”

Post-George Floyd, banks are reviewing their long-established lending requirements “to allow capital to flow in a different direction,” she says. Are all the yardsticks on bank checklists—such as credit scores, net worth, home value—necessary, she asks, or are they barriers? When you have someone outside the circle, can you make the circle a little bigger to let them in?

While Daniels-Halisi and her peer on the equity side at BMO Harris, Carl Jenkins, are African American, industry executives say they’re probably more the exception than the rule.

Still, more minority professionals are landing top postions at bank community development departments, says Calvin Holmes, president of the Chicago Community Loan Fund, a CDFI. “There is more Black and Brown leadership at the highest level of communityfacing apparatus—in commercial lending, tax credit and retail products for low-income customers,”

he says. “For many of my relationships, the buck stops with a Black or Brown person.”

Probably the least diverse space is in tax credits, where syndicators make a market in the credits used to fund affordable housing and commercial development. Banks buy tax credits, which provide funding to developers and enable the financial institutions to lower their tax liability. Banks and other organizations also are involved in the allocation of the credits.

The syndicators essentially oversee funds and earn income from fees and a markup on the capital they provide to developers.

The top firms in syndication are part of mainstream financial institutions, such as PNC, Raymond James, Alliant Capital and AIG. And big developers that work in affordable housing have the resources to take advantage of the essentially free capital. Developers of color often lack the resources or knowledge to navigate the system, executives say.

Chicago-based National Equity Fund, a unit of Local Initiaves Support Corp., is one of the nation’s largest syndicators, which last year raised and deployed $2.2 billion in affordable housing investments.

NEF in November closed on $85 million in capital, with funding from nine major banks for an Emerging Minority Developer Fund to provide access to capital to developers of color who have lacked entree to low-income housing tax credits.

NEF executives were unavailable for comment.

TRYING TO MAKE A DIFFERENCE

Minority professionals are better represented at nonprofit organizations, such as CDFIs, which serve as middlemen between banks and the neighborhoods. They’ve been around for decades but were energized under former President Bill Clinton’s administration to improve access to capital.

These organizations historically

were run by white managers for the benefit of minorities.

But at a 2015 industry conference in Detroit, the industry had a “come to Jesus” reckoning over its lack of diversity, Holmes says. After that, things started to change.

“Five years went by and, all of a sudden, you had CEOs who were African American and Latinx,” he says. “Also, CFOs, COOs, board chairs and the heads of trade associations.” Still, industry executives estimate no more than 15% to 20% of CDFIs are led by people of color.

C-suite leaders at CDFIs don’t make as much money as their counterparts who are financing office towers at JPMorgan Chase, but (it’s) enough to pay for their children’s university educations and perhaps a second home, Holmes says. He grew up in East St. Louis, with a religious family that set an expectation that if you’re doing well, you must pay it back. He says his compensation has enabled him to help support his mother, cover the down payment on his niece’s first home and contribute to local, national and international charities.

Holmes, who has headed CCLF since 1998, says he and other minority professionals head to community development because of a glass ceiling in other parts of finance, including investment banking and tax credit syndication. “People get frustrated, so they reason, ‘How can I take my technical competency, skills, certification, make a decent salary—or really good one— and move upward in my field?’ ” he says. “Community development becomes much safer harbor.”

It’s a similar motivation for Moore at LISC, who grew up in the Grand Crossing neighborhood. “I want to improve the conditions of the communities from which I come, try to make a difference,” he says.

Community development corporations, which aim to revitalize their neighborhoods by providing services and facilitating housing and commercial projects, also attract professionals of color.

Earl Chase, executive director and vice president of real estate at nonprofit developer Heartland Housing, has worked in real estate development, tax credit syndication and commercial lending, and sees more Black professionals entering the field. Earlier in his career, “I was one of a handful,” he says.

Chase is leading a team redeveloping the Laramie State Bank Building in Chicago’s Austin neighborhood under the city’s Invest South/ West Program, along with Athena Williams, executive director the Oak Park Regional Housing Center.

Chase said he worked in luxury multifamily housing, a market that went bust in the 2008-09 recession.

The developer he was working for had its eggs in one basket, “and I didn’t want to be in that position again,” he says. “You think about the long game. Can I earn a nice living and make a difference?”

There are, after all, more opportunities for leadership in community development. “I wouldn’t be the CEO at Sterling Bay,” he says.

“I would be a project manager.”

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 15

‘This feels like a different moment’ With the goal of moving the racial wealth gap needle after George Floyd’s murder, financial institutions stepped up with equity capital for minority businesses in Chicago

BY JUDITH CROWN At first blush, it seems unremarkable that a team at BMO Harris Bank last year enabled Black business partners in Bronzeville to secure a Small Business Administration loan for working capital.

But the loan to Bronzeville Winery owners Eric Williams and Cecilia Cuff would have been unlikely before the George Floyd murder, says Jeff Allen, director of the Economic Equity Advisory Group at BMO Harris. Bank loans are unusual for startup businesss, and especially for restaurants, which have struggled during the pandemic, he says.

In the aftermath of the 2020 murder that sparked a reckoning over economic inequality, banks and other financial institutions pledged funding to close the racial wealth gap by supporting small business, commercial real estate development and homeownership.

For example, BMO Harris parent BMO Financial Group launched the $5 billion, five-year EMpower

initiative “to address key barriers faced by minority businesses, communities and families.” More than a year later, those lending and investment activities are taking shape. It will take a while, executives acknowledge, to learn whether these initiatives will go far to create wealth in Black and Brown communities.

Allen’s team also is providing equity capital to minority firms in Chicago—in one instance to a private-equity firm owned by three Black partners acquiring middle-market firms in business services, consumer goods and technology, and in another case to a Latina woman-owned venturecapital company. Historically, less venture capital and privateequity capital has gone to underrepresented minorities, Allen says, and these firms are providing equity capital to business owners from diverse backgrounds.

Chicago Community Loan Fund, a community development financial institution, last year launched

a $25 million loan fund to support African American, Latino and other business developers of color.

Investors in the fund include PNC Bank at $10 million, Wintrust Bank at $9.25 million, Bank of America at $2 million and grants from Wells Fargo, philanthropist MacKenzie Scott and the U.S. Treasury Department’s Community Development Financial Institutions Fund. CCLF also has received grants from the Citi Foundation, JPMorgan Chase and Goldman Sachs.

“The special pricing and terms are allowing us to make loans to developers of color (or those focused on communities of color) who have little to no cash on hand,” says CCLF President Calvin Holmes.

“Plus, we are pricing our loans to the customer much lower than we normally could, which makes the project more economically viable to these emerging developers as they could save tens of thousands of dollars on interest costs.”

With banks and foundations stepping up, “this feels like a dif-

A rendering of Bronzeville Winery. The project was announced in 2021 and is under construction. ferent moment,” Holmes added.

“Now it’s incumbent on folks like myself to perform. For the real pricing and term concessions being offered in the new wave of social investing, donors and investors want to see measurable change in the racial wealth gap and racial equity in five to 10 years. We simply must move the needle in unambiguous ways that show up in the data.”

Citibank last year committed $200 million in private equity to Black fund managers in housing, providing five funds with $40 million each to invest and manage affordable and workforce projects. One of the recipients is Michigan-based Ginosko Development, which had

renovated two high-rise apartment buildings on the South Side.

The funding is life changing for Ginosko President Amin Irving, who is looking to do more projects in the Chicago area. Without access to capital, you are at a strategic disadvantage when it comes to acquiring property, Irving says.

Some developers try to buy properties on the contingency that they’ll win tax credits, but that’s a drawn-out and uncertain process.

“Now I can look at a property in Chicago and know that I have the confidence to acquire it, if the deal is right, without the underlying fear that I have to jump through hoops and hope that the seller buys into my creativity,” he says.

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16 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

CRAIN’S CHICAGO BUSINESS

NEIGHBORHOOD STRATEGIES

CA

The harsh reality of a dream deferred

F

Richard Townsell is the executive director of Lawndale Christian Development Corporation.

Whittney Smith is the deputy director and general counsel of LCDC.

ness to the reimagining of financial structures and limitations. In North Lawndale, the economic creativity that has allowed us to survive is taking new forms. It is bold and demands equity.

Equity, for most people of color, has been a fantasy. A dream deferred.

United Power for Action & Justice’s Reclaiming Chicago campaign plans to make equity real. Our audacious goal is to build 1,000 homes on the West Side and 1,000 homes on the South Side for home ownership for working people. People that the market cannot or will not build for.

Building on the groundbreaking organizing work of the East Brooklyn Congregations in New York City— where thousands of single-family homes were, and continue to be, built for working people—United Power will break ground this spring in North Lawndale with the first 100 homes priced around $250,000. Back of the Yards, Chicago Lawn and Roseland will break ground soon after.

The key drivers of this initiative are many: organizing by leaders in the North Lawndale Homeowners Association and other institutions to push the city to make this real; the city of Chicago contributing vacant land and TIF funds to build the infrastructure; banks and foundations contributing low-cost financing of $12.5 million to build 50 homes at a time; the state of Illinois

Robe the c office Chic nity GETTY IMAGES

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n often-quoted adage says that when America gets a cold, Black Americans get the flu. At present, the country is suffering under the worst pandemic since the Spanish flu, suggesting a truly frightening state for Black Americans. This truth extends beyond physical health. It describes our economic experiences.

Despite the recent rosy jobs report, payroll employment has yet to recover to pre-pandemic levels, and rising inflation has all but wiped out any increase in wages that folks may have received.

Entrepreneurship has declined for decades, as fewer than 2% of millennials report being self-employed. In the past several decades, $50 trillion was redistributed from working-class Americans to the top 10% of wealth holders.

The truth of the current moment is that average Americans are bearing the brunt of a deeply unwell economic ecosystem, despite the U.S. economy growing at the fastest pace in a decade.

Black Americans, particularly those in Chicago’s North Lawndale neighborhood, face the harshness of our disordered economy, while also battling the isolating and usurious elements of racism.

Yet the emergence of so many symptoms at once has given us new language for innovation. In December, 4.3 million Americans quit their jobs. Widespread financial hardship has fueled an open-

providing $10 million in homebuyer subsidies to reduce the homes’ cost by at least $30,000; and finally, missiondriven builders that are committed to a quality design and affordability.

Boldness also looks like the residents of North Lawndale seizing control over their labor and creating a path for a more just and equitable local economic system.

The Lawndale Christian Development Corporation Co-op, a business development initiative of Lawndale Christian Development Corp., has developed a model of community economic development that incorporates community organizing led by local people to build local power. LCDC Co-op is using worker-owned cooperatives as a vehicle through which Lawndale’s legacy residents’ needs are met and equity is generated that builds

wealth beyond wages earned.

In service of this strategy, LCDC is offering back-office support services, such as governance training, technical support and tax preparation, to local businesses. We are doing the work of healing our community and economy by re-centering our labor around the wellness and well-being of ourselves and our neighbors.

Maintaining the status quo is not a solution that will heal this country.

Building affordable single-family homes at scale and developing collectively owned small businesses are the kind of dynamic solutions we need.

We are at a precipice, and it will take bold vision and leadership that provides a salve of supportive philanthropy and ingenuity administered to vulnerable and overlooked communities like North Lawndale to truly inoculate this country.

BARRIER REMOVAL

We need to hack appraisal-based lending N Joe Neri is CEO of IFF, one of the nation’s largest and highest-rated diversified CDFIs.

early all real estate lending relies on “appraised value”—an estimate of a property’s value based on comparable sales or income.

It is used to determine project feasibility, acquiring or constructing buildings and financing the built environment.

It’s the sanctioned underwriting tool used by banks, regulators and government for real estate loans.

Appraised value lending is also the textbook definition of structural racism.

And creating thriving communities for all Chicagoans won’t be possible until we chip away at this pillar of systemic racism and reverse its legacy of disinvestment in communities of color.

Here’s the problem: The National Housing Act of 1934, which established the Federal Housing Administration, also opened the door for banks and real estate professionals to create “residential security” maps that designated, with red lines, communities of color that were viewed as too risky to make loans—giving birth to the legal practice of redlining.

Even though redlining only applied to FHA-insured home mortgages, appraisers and banks used the maps to set value for all types of lending. Capital

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became much scarcer in redlined communities—and when supply drops, price increases. Higher prices deterred investment, deflating real estate values and initiating a decades-long cycle of wealth extraction.

Now, fast forward to 2022. Redlining was outlawed by the 1968 Fair Housing Act, and banks are now obligated to serve formerly redlined communities under the 1977 Community Reinvestment Act. But a child care provider applying for a loan to build a new center in a once redlined community will need an appraisal. Due to the lack of market investment, however, comparable sales—if any—are unlikely to support the building’s future “as-built” value.

Some banks still might make a loan, but only for a lower amount (loan-to-value ratio limits) and/or at a higher interest rate (risk-based pricing). In the end, this child care provider will be forced to pay more, upfront or over time.

Simply put, old bank regulations like redlining drove down real estate values for decades in communities of color, and current bank regulations, such as appraisals and risk-based pricing, which still rely on those deflated values, have continued as barriers to

investment. Legal or not, the outcome sure. And over the past 34 years, we’ve made more than $1 billion in loans, is the same. Communities are denied critical investment capital that doesn’t with a charge-off rate in line with that of commercial banks. just contribute to racial wealth gaps, Other CDFIs are engaged in similar but also to racial gaps in educational attainment, health outcomes and food hacks. Allies for Community Business, a small-business lender, no longer uses deserts, according to recent studies. credit scores or collateral value for its Breaking this cycle requires that we microloans, both of which adversely hack appraisal-based lending. Is that affected business owners of color. possible? I think so. The community Instead, they now focus on the credit development financial institution that I report components they have learned lead, IFF, threw out appraisals from the start. Founded to ensure that nonprofits best predict loan repayment. serving low-income communities with APPRAISED VALUE LENDING IS THE TEXTBOOK health, human services and housing had DEFINITION OF STRUCTURAL RACISM. capital to own and imCan banks do the same? To some prove their facilities, we had no choice.

Banks wouldn’t lend to these nonprofits, degree, they already do. They are the primary investors in CDFIs that are leading and without capital to purchase their the effort to hack our financial system facilities, they couldn’t build equity and and align it with justice. But the big opinvest in their neighborhoods. portunity may be with corporations and To make these loans, we obsessed hospitals, like Starbucks and Rush Uniover what determined successful loan versity Medical Center, who are investing repayment—government reimbursein CDFIs as part of their focus on racial ments, financial management, board equity. If more socially minded investors strength and fundraising—not on appraisals. By identifying these factors, do the same, we can remove barriers like appraised value and level the playing we found a workaround to appraised field for communities of color. value and the economics of foreclo-

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 17

CAPITAL MATTERS

For scalable impact, bigger and bolder actions required

T

GETTY IMAGES

Robert Tucker is the chief operating officer for the Chicago Community Loan Fund.

he nation’s racial wealth gap statistics are staggeringly depressing.

Income inequality has been rising for decades, and wealth inequality has followed the same troubling path. The wealth gap inflicts measurable damage to Chicago’s communities and people of color, and to our entire economy.

A 2018 research report found that the median Black household has less than 11% of the wealth of the median white household. Between 1983 and 2013, the wealth of white households increased 14%, while Black household wealth declined 75%. That gap, caused by a variety of reasons, including systemic racism, historically poor wages and a lack of generational wealth-building, only perpetuates a cycle of segregation in Chicago and stifles advances on issues of equity.

Due to decades of historic disinvestment, many of Chicago’s communities of color lack access to quality jobs and neighborhood amenities that all people want in their communities. Economic development is crucial to the survival of communities of color and to the region.

The work of stabilizing and revitalizing vibrant communities—the very mission of many community

development financial institutions, or CDFIs—can lead to new development, higher-paying jobs, increased home values and, eventually, an increase in generational wealth.

CDFIs are federally recognized institutions with a track record of impact, uniquely positioned to help address equity issues. CDFIs provide lending capital, financial services and technical assistance to low-income, underserved markets. They leverage hundreds of millions of dollars of public and private capital while building wealth in historically marginalized communities of color. The Chicago Community Loan Fund, which has invested over $270 million in Chicago-area communities, is proud to be part of a rich CDFI ecosystem serving the Chicago area.

The damage suffered by communities from decades of discriminatory practices can’t be repaired overnight.

However, bright spots on Chicago’s landscape, like the revitalization of Chicago’s Pullman neighborhood, demonstrate the impact of thoughtful and intentional investment and redevelopment. Moreover, Chicago and Cook County have implemented impactful programs to target resources

into low- to moderate-income communities.

The national spotlight that was brought to issues of racial injustice following the murder of George Floyd and the Black Lives Matter protests in 2020 has led to increased private-sector interest in investing in long-disinvested communities, like Chicago’s South and West sides. Newer corporate investors and others have turned to CDFIs to advance racial-equity initiatives, recognizing that CDFIs stand at the forefront of bringing capital to local markets that have limited access to traditional financing.

Yet business as usual isn’t going to solve these issues. In Chicago and elsewhere, bigger, bolder actions would help create lasting change and unleash even more dollars into low-income communities of color.

First, equity investments in real estate deals often are missing. Catalytic real estate projects are frequently proposed in communities of color, but equity continues to be absent from the capital stack. Consequently, many of these proposed developments languish on the sidelines. Corporations, banks, insurance companies and others should

think differently and identify innovative ways to make equity investments in these developments—unlocking more lending capital, government incentives and philanthropic grants to bring these projects to fruition.

Second, opportunities exist to scale the existing infrastructure serving these markets. A greater number of corporations and others can invest in CDFIs while also providing CDFIs with permanent capital grants. Without additional permanent capital, CDFIs are limited in their growth potential and overall impact.

Finally, the cost of capital matters. In an environment where most expect an upcoming series of interest-rate hikes, CDFI investors should consider longerterm, lower-interest investments so that CDFIs can offer lower-cost lending capital to developers of color and others working in these communities.

CDFIs will continue to serve as indispensable partners in the long-term work of bringing about social, racial and economic justice. Yet CDFIs can only produce a greater, scalable impact if corporations and others take bold actions to realize all of the expressed good intentions of the last two years.

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Contact Kristin Carlson Vogen at kvogen@cct.org.

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2/11/22 3:10 PM

18 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

Most Illinois counties will get a slice of opioid settlement State Attorney General Kwame Raoul says more than 90% of eligible local governments in Illinois have signed on to the $26 billion national deal Nearly every Illinois county is poised to receive a slice of a settlement with major pharmaceutical companies, including Cardinal Health, McKesson, AmerisourceBergen and Johnson & Johnson, over painkillers that contributed to the opioid crisis.

Illinois Attorney General Kwame Raoul announced Feb. 3 that more than 90% of eligible local governments in Illinois have signed on to the $26 billion national opioid settlement. The deal calls for drug distributors Cardinal Health, McKesson and AmerisourceBergen to collectively pay almost $21 billion to resolve allegations they turned a blind eye to suspiciously large opioid shipments. Drugmaker J&J will pay $5 billion to settle claims it illegally marketed opioid medicines, which it stopped producing in 2020.

Cooperation from local Illi-

nois governments and a new law banning them from taking separate legal action against the pharmaceutical companies qualifies Illinois to receive the maximum share of about $760 million, Raoul’s office said on Feb. 3. That’s down from the $790 million figure Raoul’s office announced in July. His office did not immediately respond to a request for comment.

To receive its full share of settlement proceeds, every state must either achieve 100% signon by local governments or pass a law prohibiting them from taking separate legal action.

To date, 93 of Illinois’ 102 counties, including DuPage and Will counties, and 102 of the 113 Illinois municipalities signed on to the national settlements, according to Raoul’s office. In total, more than 290 local governments have joined the settlement.

Raoul’s office reached an Illinois Opioid Allocation Agree-

ment with local governments, which is designed to ensure the equitable distribution of settlement proceeds to counties and municipalities throughout the state.

REMEDIATION FUND

A portion of the settlement proceeds will also go to an Illinois Remediation Fund, which will provide money to recommended abatement programs. The fund will be overseen by an advisory board established as a subcommittee of the state’s Opioid Overdose Prevention & Recovery Steering Committee. Half of the board’s voting members will be from participating local governments; the state will appoint the other half. Funds will be allocated to local governments based on an area’s population, opioid usage rates, overdose deaths and the amount of opioids shipped to a given region.

“Settlement money must be

GETTY IMAGES

BY KATHERINE DAVIS

distributed equitably throughout Illinois to provide funding for critical recovery services,” Raoul said in a statement. “The Illinois Opioid Allocation Agreement is a step toward ensuring communities receive the resources needed to help abate the effects of the opioid crisis in our state.”

Opioid-related fatalities in Illinois have steadily risen since

2013, according to the Illinois Department of Public Health.

2020 saw the largest annual increase in opioid-related deaths, up 32% from 2019. More than 2,900 deaths—an average of eight per day—were related to opioid overdoses in 2020, and first responders were called to more than 19,400 opioid overdoses in 2020 alone.

Novara leads effort to ‘use inclusionary housing tools to reduce segregation’ HOUSING from Page 3 That City Hall-as-activist philosophy has fueled Novara’s 90-person housing department since mid-2019, when incoming Mayor Lori Lightfoot named her to run the agency. Under Novara, the department has worked to slow or manage gentrification not only in Pilsen, but also in Woodlawn around the Obama Presidential Center and in neighborhoods on the western end of the 606 recreational trail.

Those efforts are only part of an ambitious agenda driven mostly by Novara’s belief that “we must use inclusionary housing tools to reduce segregation, not maintain it.”

As Lightfoot’s point person on housing, she’s spearheading the most aggressive effort ever by a Chicago mayor to ease a growing affordable housing crisis, while also tackling longstanding economic and racial segregation in the city. At the same time, the program reflects

through zoning changes or funding must create. The revamp was designed expressly to reduce Chicago’s entrenched segregation.

Another example is a 2020 ordinance that allows new ADUs, or accessory dwelling units, such as coach houses and granny flats, in residential areas for the first time since the 1950s. It’s in the pilot stage now, but in the long run is an attempt to change the overall housing mix of all neighborhoods by adding smaller, more affordable units on blocks that are dominated by single-family homes.

STRIVING FOR EQUITY

The Pilsen project was part of Novara’s biggest initiative yet, the parceling out of low-income tax credits and city funds that could unlock a billion dollars in affordable housing development around the city. Apart from the dollar amount, the biggest in the city’s history, there’s an equity IT’S ABOUT “GETTING TO OUR MISSION, objective.

In 2021, a deep WHICH IS THE EQUITABLE DISTRIBUTION dive by her department into the OF AFFORDABLE HOUSING ACROSS ALL racial and geographical makeup 77 COMMUNITY AREAS.” of the city’s past affordable housMarisa Novara, Chicago housing commissioner ing efforts found a top-down approach to policy- that developments using tax credmaking in which citywide hous- its were largely concentrated in ing goals can override local low-income areas on the South neighborhood priorities. and West sides. So they tailored That approach is seen in a the latest round of tax credits to revamped Affordable Require- change that pattern. ments Ordinance that dic“While we’re very excited tates the amount and type of about the sheer volume of what affordable housing that devel- we’re able to do, it’s also about opers who receive city support getting to our mission, which

P018_CCB_20220214.indd 18

is the equitable distribution of affordable housing across all 77 community areas,” Novara said in a December Zoom call with press to announce 24 projects that, if all are built, will provide 2,400 new affordable housing units.

If all of Novara’s initiatives bear fruit, Chicago “will look more equitable,” said Guacolda Reyes, chief real estate development officer at the Resurrection Project, a group that has been building or rehabbing affordable housing in Pilsen since 1991. “There will be a little less racial segregation, and more neighborhoods that embrace diversity of incomes.”

Not everyone is a fan of Novara’s zeal for new affordable housing developments. She draws fire for a proposal she supports that will include dozens of affordable units in a new 300-apartment project near O’Hare International Airport.

“I wish she’d do her homework,” says Ald. Nicholas Sposato of the 38th Ward. “I can look out my office window right now at the affordable housing that we already have” in Dunning, around Harlem Avenue and Irving Park Road. “We have thousands of three-flats, six-flats—they tell me (they’re) about 8% vacant. But they don’t have stainless steel appliances.

They might have formica countertops and shag carpeting, but they’re affordable.”

The project “is going to make a lot of competition for the seniors who own those three-flats and are trying to live off ” the rental income, Sposato warns.

He and fellow Northwest Side Ald. Anthony Napolitano, 41st,

opposed the plan, advanced by Glenstar Properties in Napolitano’s ward and approved last fall by the City Council in a rare departure from the tradition of aldermanic prerogative—which gives council members effective veto power over proposed developments in their wards.

Napolitano was quoted several times in the press saying he doesn’t oppose affordable housing, but wanted a commercial property on the site, along the north side of the Kennedy Expressway at Cumberland Road. Napolitano did not respond to Crain’s request for comment.

Liz Butler, a land use and zoning attorney at the Chicago firm Elrod Friedman, says Novara’s support put the project over the top after Glenstar “voluntarily doubled the affordable housing” to 20% of the 297 units.

Butler describes Novara’s style as “leading with empathy.”

SOCIAL WORK

Novara grew up in Kalamazoo, Mich., and now lives in Little Italy with her husband and two children. She says her interest in affordable housing began in the late 1990s, when she was working toward a master’s degree in social work at the University of Chicago.

Working with a North Lawndale organization that helped women on welfare find jobs, she discovered that “having stable housing was usually an obstacle for these women.”

She recalls helping a Black mother named Rita find a new apartment after one of her children was diagnosed with lead poisoning. “She had a letter

from a doctor that said, ‘You have to move or (the Department of Children & Family Services) will take your children,’ ” Novara says.

After she helped Rita—whose last name Novara doesn’t remember—apply for an affordable housing program on the West Side, the property manager, according to Novara, said, “Thanks. That will be a 15- to 20-year wait.”

“I remember we got back in my car and sat there in silence,” Novara says. It dawned on her, she says, that “housing you can afford is a justice issue, and there is an injustice being done.”

Novara later worked for an affordable housing developer and then for the Metropolitan Planning Council. Beginning in 2015, Novara led the MPC’s effort to measure what segregation costs Chicago. The study included an estimate of the cost in lives and dollars lost, and a set of recommendations.

The proposed solutions included rewriting the ARO with racial equity in mind and spreading city-sponsored affordable housing throughout Chicago.

In 2019, “candidate Lightfoot was one of the first people we briefed,” Novara says, likening the “Cost of Segregation” report to “the MPC standing on the outside, knocking on the door and saying, ‘Hey, city of Chicago, don’t you want to do this differently?”

Her appointment as housing commissioner, she says, was “the mayor opening the door and saying, ‘Come on in and go do all this.’”

2/11/22 3:40 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 19

PEOPLE ON THE MOVE

Advertising Section To place your listing, visit www.chicagobusiness.com/peoplemoves or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com

ACCOUNTING

BANKING / FINANCE

FINANCE

LAW

LAW

Porte Brown LLC, Elk Grove Village

Busey Bank, Chicago

Morgan Stanley, Chicago

Bradford & Gordon, Chicago

Golan Christie Taglia, Chicago

Porte Brown, a Chicagoland accounting firm, is pleased to announce the election of Joseph A. Gleba as the firm’s next CEO and managing partner, effective 1/1/22. Gleba, a CPA and a CCIFP, began his career as a staff accountant at the firm in 1996 and became a partner in 2009. He has held several leadership positions throughout the years including as the partner-in-charge of the McHenry office, a member of the firm’s executive committee, and a lead partner of the construction industry practice.

Busey Bank welcomes Willie Mayberry, EVP - President of Regional Banking. With 30+ years’ experience, Willie is uniquely qualified to oversee the bank’s client facing sales teams and Mayberry relationship managers across the footprint. This includes Commercial Banking, Wealth Management, Retail and Treasury Management.

Busey Bank is also pleased to announce Jeff Burgess as EVP Burgess President of Busey Wealth Management. Jeff was most recently with Commerce Bank and joins Busey with 20 years’ experience. For the Wealth Management division, Jeff is responsible for the oversight and execution of operations, vision and strategy. Together, Willie and Jeff’s teams focus on regionalized growth.

Morgan Stanley welcomes Carolyn Song-Pegg as Portfolio Manager, Senior Vice President, Financial Advisor in the Chicago Mercantile Complex. Song-Pegg brings over 14 years of industry experience including the past 6 years at Fifth Third Securities, where she was a Vice President. Carolyn holds a Masters of Urban Planning and Policy/ Public Administration and a Bachelor’s Degree-Double Major Political Science and Mass Communication from University of Illinois at Chicago. For more information, visit https://advisor. morganstanley.com/carolyn.song-pegg.

Nadia Shamsi has been promoted to Partner.

She is a Certified Financial Litigator and has represented clients in all aspects of divorce litigation including high-asset divorces, postdecree modifications, grandparent visitation, and pre- and post-nuptial agreements. Nadia has contributed to the Illinois Institute for Continuing Education and the DuPage County Bar Association magazine. She serves on the Ambassadors Board for Legal Aid Chicago and is a member of the Hinsdale Junior Woman’s Club.

Katherine M. Oswald and Nichole M. F. Siedlarczyk have been elevated to Partnership at GCT. Katherine focuses her practice on estate planning and Oswald taxation, representing clients in complex issues pertaining to individual asset planning and settlement of estate taxes. She assists organizations in business succession planning, asset protection, estate and trust administration Siedlarczyk and litigation.

Nichole serves clients in the areas of corporate law, IP and commercial real estate law, focusing on corporate governance matters, outside counsel work and M&A. She leads clients in negotiations, equity and debt financings, structuring new business ventures, equity incentive plans for employees and contractors, lease review and real estate transactions.

BANKING / FINANCE Itasca Bank & Trust Co., Itasca Thomas R. Hogan, CTFA has been appointed Vice President and Trust Officer at Itasca Bank & Trust Co. in Itasca, Illinois. He will be the main point of contact on all customer accounts. With over 10 years of experience in trust and estate administration, he was most recently a Trust Officer at a regional bank with multiple offices in the Chicagoland area. Tom is a Certified Trust and Fiduciary Advisor (CTFA), a professional designation offered by the American Bankers Association (ABA).

BANKING / FINANCE Itasca Bank & Trust Co., Itasca Itasca Bank & Trust Co. in Itasca, Illinois, recently hired two commercial lenders. Bill Dierking has been appointed Vice President and Commercial Loan Officer. With over 30 years of experience Dierking in commercial lending in national, regional and community banks, he was most recently a Commercial Loan Officer at a local bank in the Chicagoland area.

Sam Vardalos has been appointed Vice Vardalos President and Commercial Loan Officer. With over 30 years of experience in the financial industry, he was most recently Vice President and Business Banking Relationship Manager at a large regional bank with multiple offices in the Chicagoland area. Itasca Bank & Trust Co. is an independent, locally-owned bank founded in 1948.

To order frames or plaques of profiles contact Lauren Melesio at lmelesio@crain.com or 212-210-0707

P019_CCB_20220214_v3.indd 1

LAW Foley & Lardner LLP, Chicago HEALTH CARE Access Community Health Network, Chicago

CONSTRUCTION Lendlease, Chicago Daniel Pomfrett has been appointed as the Head of Cost Planning for Lendlease Americas.

Daniel combines a wealth of experience in financial reporting, management, resource allocation, and market economics analysis with a deep knowledge of the construction marketplace. In this national role, Daniel aspires to promote the value of cost planning, drive consistent best practices, and help standardize data capture throughout business operations.

Access Community Health Network (ACCESS) is excited to announce the appointment of Miriam Mobley Smith, Pharm.D., FASHP, as the new Chairman of the ACCESS Board of Directors. Dr. Mobley Smith currently serves as the interim dean and visiting professor at the Daniel K. Inouye College of Pharmacy at the University of Hawai’i at Hilo. She also serves on the Chicago Pharmacists Association Foundation Board, Futuring Advisory Board for GlaxoSmithKline, and Editorial Advisory Board for Pharmacy Times.

Emil Khatchatourian has been elevated to partner with Foley & Lardner LLP. Emil is a restructuring and bankruptcy lawyer and has represented debtors, trustees, secured lenders, unsecured creditors, purchasers of assets, investors, and other stakeholders in a broad range of restructuring matters, including complex chapter 11 proceedings, out-of-court workouts, acquisitions, liquidations, and bankruptcy litigations in both federal and state court.

Levenfeld Pearlstein, LLC, Chicago Levenfeld Pearlstein, LLC (LP) named Jeremy Gresham its new Chief Executive Officer, effective February 1, 2022.

Gresham has been with LP since 2015, serving recently as LP’s Chief Financial Officer.

As CEO, Jeremy will provide stability for LP as he strives to foster the LP’s entrepreneurial spirit and business-centered approach to law firm management. He brings more than 17 years of experience in law firm accounting, finance, and leadership to the role.

CONSTRUCTION MZI Group Inc., Chicago MZI Group Inc. a minority and veteran-owned construction company, which specializes in electrical and mechanical construction, telecommunications, Cauley energy infrastructure, and utility projects, is pleased to announce the appointment of Morgan Cauley as the Director of Diversity and Jazmira Bota as the Marketing Manager.

Cauley, who has been with MZI for 2 years, Bota will be instrumental in establishing programs and policies fundamental to the advancement of diversity, equity, and inclusion.

Bota, who joined MZI this past fall from KPMG, will be executing marketing strategies to drive overall brand development as well as focus on demonstrating the value MZI Group brings with over 22 years of expertise and its unprecedented growth in 2021 alone.

LAW

HEALTH CARE NorthShore University HealthSystem, Evanston NorthShore University HealthSystem (NorthShore) has named Mark Ricciardi, MD, as the Mr. and Mrs. Charles R. Walgreen Jr. Chair of Cardiology, and Ricciardi Bridget Wild, MD, FAAP, CHSE, as the Alvin H. Baum Family Fund Chair of Simulation and Innovation.

Dr. Ricciardi is the Director of Interventional Cardiology and Structural Heart Disease Clinical and Research Wild Programs at NorthShore.

He holds the academic appointment, Clinical Professor of Cardiology at the University of Chicago Pritzker School of Medicine.

Dr. Wild is the Director of Medical Simulation for the Grainger Center for Simulation and Innovation. She holds the academic appointment, Clinical Associate Professor of Pediatrics at the University of Chicago Pritzker School of Medicine.

LAW Freeborn & Peters LLP, Chicago Freeborn & Peters LLP is pleased to announce that the firm has elected Steven D. Pearson as its new Co-Managing Partner and has elected former Co-Managing Partner Joseph L. Fogel Pearson to the firm’s Executive Committee.

As Co-Managing Partner along with William E. Russell, Mr. Pearson is responsible for development and execution of the firm’s overall growth Fogel strategy, overseeing firm operations, management of firm expenses, policies and procedures and more.

As a member of Freeborn’s Executive Committee, Mr. Fogel is responsible for strategic planning, the development of the firm’s mission, oversight of firm committees, and more. Steve and Joe are both Partners in the firm’s Litigation Practice Group.

TECHNOLOGY Provi, Chicago Erica Golden has been named as the new senior vice president of people at Provi, the fastest-growing ecommerce marketplace for the beverage alcohol industry. In the newly created role, Golden will lead the company’s human resources and talent development efforts. Golden brings more than 16 years of experience in human resources and talent management to her role at Provi, having led team recruitment, hiring, training and development at some of the most successful tech companies in the U.S.

2/8/22 3:12 PM

20 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

.

To place your listing, contact Claudia Hippel at 312-659-0076 or email claudia.hippel@crain.com www.chicagobusiness.com/classifieds CAREER OPPORTUNITIES

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REAL ESTATE

Reader’s move to nonprofit status stalls READER from Page 2 approval, the new Reader Institute for Community Journalism, was set to take ownership of the Reader’s low-profit entity on Dec. 31, 2021.

The nonprofit could not take ownership immediately because the Reader had a Paycheck Protection Program loan. It did start fundraising immediately, however, and has raised more than $1 million in the past year and a half, Baim said.

She said she is committed to saving the jobs of the Chicago Reader’s 35 employees, and hopes the impasse is resolved soon. She also called for continued support of the Reader’s nonprofit and low-profit entities during the time of transition.

“I am saddened that the editorial independence issues are what is at the heart of this dispute,” she said. “I stand by my editors and their attempts to do their jobs without outside interference.”

The nonprofit has been funding the Reader’s operations, but that relationship is set to expire March 1. Though there is a possibility the relationship could be extended, the two-month-long stalemate has hurt morale among the Reader’s staff, said Philip Montoro, music editor at the Reader and chair of the publication’s union.

Montoro has been with the Reader since the 1990s, when the publication was so thick, “you could drop the paper from chest height and kill a rat with it,” he said.

JOHN R. BOEHM

CLASSIFIEDS

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Tracy Baim, co-publisher of the Reader, has spearheaded its transition to a nonprofit.

“I’ve seen nothing but layoffs and shrinkages and absentee ownership and horrible mismanagement. We’ve ping-ponged from owner to owner,” he said.

“Now we have a leadership team that we have great faith in that has rebuilt the paper from a husk of its former self. Our staff is growing, I’m not exaggerating, for the first time since 2007.”

The stalemate has killed some of that optimism, he said. The uncertainty it is causing is also harming the nonprofit’s ability to operate normally and approach donors about funding.

INVESTED

Co-owners Higginbottom and Goodman both said they still believe transitioning to a nonprofit promises the best outcomes for the Reader. The two have invested more than $2 million in the paper since they bought it.

Goodman, a lawyer who counts former Illinois Gov. Rod Blagojevich among past clients, said the

board members just want some assurances before the assets are transferred. He said the concerns raised were legitimate.

“We want some assurances that the Reader will respect free speech,” he said. “I support the Reader. I’ve supported it financially and wanted it to survive.”

Higginbottom, a real estate investor, bought his first building after seeing an ad in the Reader’s real estate section. He graduated college around the same year the Reader launched, and said he’s always had an affinity for it. He was also an investor in the Chicago Sun-Times, which recently became a nonprofit through an acquisition, and says the transition is the right path forward for the paper. He said he hopes Goodman will come around.

“I really would like to go forward with the deal, just Len has to get comfortable,” he said. “He and I are the only shareholders, we’re equal shareholders, and I’m ready to go.”

Odds of big refunds from ComEd now look slim COMED from Page 3

OUR READERS ARE 125% MORE LIKELY TO INFLUENCE OFFICE SPACE DECISIONS

Find your next corporate tenant or leaser.

Connect with Claudia Hippel at claudia.hippel@crain.com for more information.

P020_CCB_20220214.indd 20

conspiracy in a July 2020 deferredprosecution agreement with the U.S. attorney’s office in Chicago, it agreed to pay a $200 million fine to the feds. Consumer advocates quickly cried foul, saying ComEd customers—not U.S. taxpayers— were the victims.

Multiple class-action lawsuits against ComEd were filed, most in federal court. The federal lawsuits were dismissed quickly, leaving the single one in state court remaining. Cook County Circuit Court Judge Cecilia Horan dismissed that one on Dec. 23.

The federal plaintiffs refiled their cases in state court, but ComEd says it will move to dismiss those soon.

Horan concluded that, without evidence, she couldn’t determine if the state laws enacted as ComEd was bribing associates of thenHouse Speaker Michael Madigan to win his favor that were passed because of the illegal conduct were invalid.

“As Chief Justice John Marshall bemoaned more than 200 years ago, that corruption should find its way into the government is a

circumstance most deeply to be deplored,” she wrote in her decision. “But the validity of a law does not depend upon the motives of its framers. The constitutional separation-of-powers principle precludes judicial review of the legislative process behind (their) enactment.”

ACCOUNTABILITY

In the ICC proceeding, ComEd in December proposed to make a little over $21 million in refunds to ratepayers, to be paid in April 2023. That would mean very roughly about a $5 refund for the average customer. The utility believes its offer goes beyond what is required in the state law.

“The government has not alleged, nor has any court found, that ComEd customers were harmed by the bipartisan legislation referenced in the deferred prosecution agreement or that ComEd made any excessive investments,” ComEd spokeswoman Shannon Breymaier said in an email. “As with the federal investigation, ComEd continues to cooperate with the ICC investigation required by the state’s new clean-energy law.”

That proceeding now is focused on what internal ComEd documents and communications the class-action lawyers and others have the right to see.

In briefs, the class-action attorneys asserted that the judge’s interpretation was mistaken. But for the bribery that won Madigan’s support, neither of the laws would have passed, they argued.

“The General Assembly could not consider the energy legislation until after Madigan allowed the real legislative process to begin,” they wrote in a motion for reconsideration, which Horan denied.

“The proposed complaint also establishes that Madigan acted with corrupt and pecuniary motive when he finally advanced the energy legislation only after ComEd paid him to do so.”

Madigan hasn’t been charged in the ongoing federal investigation surrounding ComEd and has said he did nothing wrong. There is no evidence in what’s been filed so far in court that Madigan was paid directly. Rather, it was close associates and political lieutenants whom federal prosecutors have said were paid to curry Madigan’s favor.

2/11/22 4:28 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 21

Here’s how Reyes Holdings became the biggest beer distributor in the nation Coors, has been deepening its relationship with Constellation Brands, whose imported labels like Corona Extra, Modelo and Pacifico appeal to Latinos and other consumers in the Reyes’ rich pastures of California and Florida.

But Reyes’ expansion in California hasn’t been welcomed by all. A California craft brewer sued after its distributor was acquired by a Reyes subsidiary. Seismic Brewing alleged that the Reyes unit changed its contract in ways that made it “virtually impossible” to switch distributors, according to a newspaper account.

The Reyes-owned distributor countersued for breach of contract, and Reyes termed the allegations “baseless.”

Smaller California distributors also have complained about Reyes’ tactics. “Large, out-ofstate distributor corporations are forcing local, family-owned distributors out of business using unfair business practices,” said a spokeswoman for the recently formed California Family Beer Distributors.

REYES from Page 1

TIGHT-KNIT FAMILY

From all accounts, the family remains tight-knit—and tightlipped—after the patriarch, Joseph, died last year at 94. None of the Reyeses would comment.

Another generation is rising in the ranks. Chris’ son Stephen heads Reyes Holdings’ East Division beer unit, and another son, Andrew, is president and chief customer and commercial officer for Reyes Coca-Cola Bottling. Jude’s daughter Sara Reyes works in communications.

“I could not envision a divisive issue among the three (elder brothers),” says Manny Sanchez, a Chicago lawyer, who credits himself for persuading Chris decades ago to become more involved in the broader Chicago business community, culminating in invitations to join then-prestigious boards like that of Tribune Co. “They’re just so close. I witnessed it firsthand,” says Sanchez, mentioning a visit to the former John Wayne estate in Acapulco when it was owned by the brothers’ parents.

Thompson and Sanchez say

P021_CCB_20220214.indd 21

‘INFLAMMATORY RHETORIC’

GETTY IMAGES

concentration of Big Alcohol and its distribution networks, and Reyes Holdings is embroiled in litigation for allegedly sidelining brands after rolling up distributors.

Founded in the mid-1970s with the $740,000 purchase of a Schlitz distributorship in South Carolina, Reyes Holdings today is by far the biggest beer distributor in the country. With volume of 260 million cases last year, it outsells AB InBev’s company-owned network by more than 2-to-1.

With beer consumption declining, Reyes has branched into soft drinks, acquiring enough CocaCola bottlers to leave it a bubbly head shy of being the largest Coke bottler in the U.S. Reyes also owns a company called Martin Brower, which supplies food and packaging to McDonald’s and other restaurant operators.

Altogether, the company employs 31,000 workers serving customers in 46 states and 18 countries, depending on a fleet of more than 20,000 vehicles.

“They run the operations of the future in my opinion,” says Joe Thompson, a Georgia-based adviser on beer distributor deals, summarizing the industry’s trajectory: “We’ve gone from (small) family-owned businesses, to millionaires, to billionaires.”

That arc has put the Reyes brothers—including Tom, who runs West Division beer operations, and James, who heads real estate—in clover. Chris, the eldest at age 68, lives primarily at an oceanfront estate on Jupiter Island in South Florida. He has donated nearly $4 million to Republican candidates and committees since 2016. After Donald Trump was elected president, Chris Reyes wrote a $50,000 check to his campaign, according to federal election records.

J. Christopher Reyes in 2012

“I CAN’T SEE ONE BENEFIT OF GOING PUBLIC. THEY DON’T NEED THE MONEY—OR THE HEADACHES OF PUBLIC DISCLOSURE.” John Canning, who sits on the Northwestern Memorial HealthCare board with Chris Reyes

the brothers bond over dayslong, private-jet golf trips to celebrated courses like Bandon Dunes in Oregon.

Andrew McKenna, the former McDonald’s chairman and civic leader, and Pat Ryan, the insurance mogul, also are close to Chris. A person in a position to know says Ryan wanted Reyes as a Lake Geneva neighbor and, after the death of Richard Driehaus, encouraged Reyes to act on the Glanworth Gardens estate. Ryan did not respond to a rerquest for comment.

Other family enterprises that have grown considerably over generations, such as the Mills family’s Medline Industries and the Pritzker family’s Marmon Group and other holdings, have been broken up or sold in whole or in part to outside investors when younger generations clamored for cash-outs. For Reyes Holdings, that day is likely a generation away—if then—provided the Pritzker or Mills family histories are useful guides.

A Reyes company spokeswoman says it’s committed to remaining closely held, with no interest in a public offering of stock.

“I can’t see one benefit of going public,” says private-equity executive John Canning, who sits on the Northwestern Memorial HealthCare board with Chris.

“They don’t need the money—or

the headaches of public disclosure.”

Estimating Reyes Holdings’ potential sale value with any precision is impossible without access to company financials. But it’s fair to say the number is in the tens of billions. For comparison, private-equity firms agreed to pay more than $30 billion for Medline, a company with barely half of Reyes’ revenue.

Reyes Holdings also depends on non-family members to run its key units. Beverage industry vets oversee the beer and Coke divisions, with another above them. Martin Brower’s CEO is a recently promoted Winston & Strawn alum, Sarah Burke.

SYNERGIES

Increasing collaboration between beer and soft drink industries offers Reyes Holdings potential synergies, amplified by heft that allows it to outbid competitors for more territorial rights—and tick off smaller distributors, including ones in California that have broken with the state’s beer distribution lobby and banded together to fight Big Beer.

The company says it has no plans to overlap its beer and cola units, but it’s not hard to envision lots of crossover opportunities as booze and soft drink makers pair up to roll out “hard” lemonades and other

spiked products. Coke has allied with brewer Molson Coors and PepsiCo with Boston Beer.

Meanwhile, Monster Energy is buying craft brewing “collective” CANarchy, whose products Reyes distributes.

“Based on the blurring of category lines in alcohol and nonalcohol, Reyes is in a really strong position to capitalize on that trend,” says Duane Stanford, editor and publisher of Beverage Digest.

Reyes Holdings’ growth hasn’t come without controversy. In a letter in September to federal regulators considering rule changes that would help smaller players gain market access, the Brewers Association trade group singled out Reyes in complaining that many beer distribution markets are effective duopolies. It cited Census Bureau data showing that operating profit margins for beer distributors have climbed to 29% over the last three decades, double the declining figure for all nondurable wholesale goods.

Reyes controls about half of the California beer market—as much as 160 million cases, more than three times the output of the state’s 958 craft breweries, according to the association—following multiple acquisitions in the state since 2018. Reyes is also big in the Upper Midwest and along the Eastern Seaboard.

The company, with a longstanding connection to Molson

After President Joe Biden last summer gave the Treasury Department’s Alcohol & Tobacco Tax & Trade Bureau an early March deadline to propose legal changes that would help smaller players gain market access, Reyes in a letter to the bureau called the complaints sour grapes, largely from unsuccessful distributors.

“Comments such as those from California Family Beer Distributors are filled with inflammatory rhetoric about forced sales but ignore the fact that brewers make individual choices to move their beer distribution rights to a distributor that provides the most efficient and effective service,” Reyes said.

Meanwhile, Reyes Holdings rolls on. “They’re always looking,” notes Thompson, who says he’s shopping a couple of client distributorships to Reyes.

The proliferation of craft brews and new hard seltzer products favors big players like Reyes that can manage complexity and spread fixed costs over a broad network. Reyes at the end of 2019 refocused on its core operations by selling a food distribution company for $2 billion that it bought in 2005. The deal caused an 18% drop in 2020 revenue, but Reyes recouped more than half of that last year.

While overall beer sales have been falling since 2015, consolidation opportunities appear to dwarf that trend—the very prospect that terrifies smaller brewers. An estimated 600 beer distributors nationwide have a minimum of $1 million in revenue.

Harry Schuhmacher, editor and publisher of Beer Business Daily, says Reyes routinely outbids competitors. “They’re a private-equity firm in many ways,” he says, with an added benefit: “They know the business.”

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22 FEBRUARY 14, 2022 • CRAIN’S CHICAGO BUSINESS

Proximity to strong research and academic centers helps attract innovation hubs Although innovation hubs help strengthen the local economy, Having more innovation hubs they seldom create large numbers burnishes the city’s reputation as of jobs. Most operate more like an innovative and tech-forward small satellite offices designed place to do business. They also help for collaboration with external support Chicago-area startups by companies, startups and organiconnecting budding companies zations. And because corporate with deep-pocketed potential cus- leadership is often located at a headquarters in another part of tomers, investors or buyers. “(Innovation centers) are a the state, country or world, Chicabridge between the startup eco- go doesn’t necessarily benefit if an system and the bigger corporate out-of-town company develops its world,” says World Business Chi- next big product at an innovation cago President and CEO Michael hub here.

Companies are choosing ChiFassnacht.

Innovation hubs shouldn’t be cago for innovation centers based confused with corporate technol- on the city’s proximity to strong ogy offices, which have also been research and academic centers cropping up in Chicago lately. and a cluster of vibrant industries, including in the food, manufacturing and “CHICAGO IS THE EPICENTER OF THE industrial sectors.

There’s no data FOOD INDUSTRY, BOTH FROM AN showing how ChicaAGRICULTURE PERSPECTIVE AS WELL go compares to other cities as a location for AS FOOD MANUFACTURING.” innovation centers.

But Illinois ranked Lavanya Venkateswar, head of marketing and 9th nationally in 2017 sales of food ingredients, Univar Solutions in research and development activity, Companies like Deere and Am- reaching $18.1 billion across busiazon have opened Chicago tech nesses, universities and federal offices, which often employ hun- labs, according to a 2020 report dreds of software engineers and from the Illinois Science & Techother specialists developing tech- nology Coalition. When it comes nologies for frontline business op- specifically to business R&D, expenditures in Illinois reached erations.

INNOVATION from Page 3

$14.4 billion in 2017, which has increased by about 2.4% annually since 2013, the report shows.

INGREDIENTS

Univar Solutions, a Downers Grove-based food chemical and ingredient distributor, is the latest example of the innovation center trend. The Fortune 500 company opened an innovation hub in January at The Hatchery, a food incubator home to hundreds of startups on the West Side. Battle Creek, Mich.-based Kellogg also opened an innovation hub there in 2020.

Kevin Hack, global vice president of food ingredients at Univar Solutions, said a presence at The Hatchery will help the company stay abreast of emerging food trends and find new customers.

“As these companies grow and develop, they will need people like Univar Solutions to provide them with ingredients,” Hack said.

Univar Solutions also considered Los Angeles and New Jersey, but chose Chicago because of its massive food industry and the fact that many Univar suppliers and customers are based in the city.

“Chicago is the epicenter of the food industry, both from an agriculture perspective as well as food manufacturing,” said Lavanya Venkateswar, head of marketing

and sales of food ingredients at Univar Solutions.

Bosch, the German manufacturing giant, was one of the first out-of-town companies to open an innovation center in Chicago back in 2017. Called the Chicago Connectory, the center launched through a partnership with startup incubator 1871 on the fifth floor of the Merchandise Mart.

“We thought that we needed a connection with an innovation ecosystem,” said Fermin Fernandez, the Connectory’s managing director.

The hub, which houses about 25 full-time Bosch employees, has helped the company find new customers and develop internet-ofthings products. One example is Bosch’s BlueHound service, which helps clients electronically keep track of drills and other tools.

MARKETING TOOLS

Not all innovation hubs result in new products, though. DeBiase says some are mere marketing tools aimed at convincing consumers and shareholders that an old company is innovative.

“There’s a little bit of innovation theatre still going on,” DeBiase says. “It’s companies showing everyone that they’re great, cutting edge and they’re doing innovation. But when you look at what new products, services and ventures have actually been devel-

oped in these programs, they can’t point to 100 products.”

Some hubs focus on connections rather than product development. Dublin-based consulting giant Accenture opened an innovation center at 500 W. Madison St. in 2017. Now it’s in the process of expanding the space from one floor to two. The company says its main goal is to connect Accenture clients to and educate them about emerging technologies.

“When they come into our hubs . . . they get more engrossed and engaged in the conversation, which allows them to co-create with us and come up with newer ideas,” said Shivani Vora, head of innovation in North America at Accenture. “It’s just a different environment for them to solve some of their toughest problems.”

Accenture also uses its innovation center to find startups to acquire or invest in. Since opening the hub, Accenture has acquired Chicago-based companies like big data and artificial intelligence startup Kogentix and data science consultant Clarity Insights.

Whatever their purpose, innovation hubs keep coming to Chicago. Fassnacht says WBC is having “early conversations” with other companies looking to put innovation centers in Chicago later this year. “There’s more to come.”

Solving Chicago Tech’s Racial Gap A Crain’s Webcast Thursday, Feb. 24, 2022 | 1:00 p.m.

A recent report from economic development organization P33 shows racial disparities are linked to a shortage of Black and Latino computer science students graduating from Illinois colleges. P33 CEO Brad Henderson, Cleveland Avenue Investor Andrea Zopp and Techstars Managing Director Neal Sáles-Griffin will join Crain’s reporter Katherine Davis to discuss the gaps in tech workforce training, who will fill them and other avenues to pursue a career in technology.

Register today at ChicagoBusiness.com/TechLeaders Sponsored by

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 14, 2022 23

Buyer saw this 1970s house on Zillow Gone Wild and grabbed it

BY DENNIS RODKIN When a house for sale in Rolling Meadows—concrete on the outside and swinging ‘70s on the inside—popped up on the Zillow Gone Wild Instagram account in November, Emily O’Brien was one of over 44,000 people who gave it likes, but the only one who wound up buying it.

“I like how it mixes brutalism, midcentury, ‘70s and fun,” said O’Brien, who bought the house on Tall Oaks Lane for $531,000 on Feb. 2.

Built in 1977 and in one family’s hands from 1991 until O’Brien bought it, the house is four concrete cylinders around a square, with more curves inside, including a circular second-story walkaround, an oval fireplace made of brick and wood, and a

spiral staircase. The indoor pool has windows two stories high, there’s a swanky bar wrapped in wood and mirrors, and much of the custom-built furniture has a distinctly 1970s vibe.

The concrete exterior makes it look “like an evil villain’s lair,” O’Brien said, while the interior is more of “a Playgirl party house.”

O’Brien, who sells vintage clothes under the brand name Hello Vintage, said she expects the home to work well as a backdrop for merchandise photo shoots, as well as being a place to live. She lives in Oakland, Calif., now but is moving back to the Midwest where she has roots.

When she saw the Instagram post on a Friday in early November, O’Brien booked a Monday flight and went with her agent, Heather Owino of Keller Williams

HOW TO CONTACT CRAIN’S CHICAGO BUSINESS EDITORIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 312-649-5200 CUSTOMER SERVICE. . . . . . . . . . . . . . . . . . 877-812-1590 ADVERTISING . . . . . . . . . . . . . . . . . . . . . . . . . 312-649-5492

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Success, to see the house, even though the sellers already had some offers. She liked it so much, she put in an offer with an escalation clause, ultimately finishing as the top bidder.

In the primary bedroom, Owino said, is a built-in round bed with cabinets in the headboard. It reminded her of bachelor pads in vintage movies “where you can push buttons” and make cocktails appear, she said.

The round bed was sold with the house, as were the round couches.

O’Brien paid about 1.3% more than the $524,000 asking price, but she said she’s not concerned.

In Oakland, she said, “you can’t get a house for under $800,000 that isn’t a fixer-upper.” This house needs some work, she said, but she has rehabbed other

VHT STUDIOS PHOTOS

‘I like how it mixes brutalism, midcentury, ‘70s and fun,’ she said of the four-bedroom house with a concrete exterior and a swinging 1970s interior

houses, including another 1970s home with a circular element.

The price is not much above what the seller, Anders Stubkjaer, paid for the home in 1991. He bought it then for $510,000, selling this week for 4% more than that. The house was sold in as-is condition.

The four-bedroom, roughly 3,500-square-foot house was built in 1977 on a wooded half-acre.

The name of the architect has not surfaced, said Lou Zucaro, the Baird & Warner agent who represented Stubkjaer.

In 2016, when he was preparing to put the house on the market, Stubkjaer told Crain’s that the concrete walls ensure “that you don’t hear anything from outside,” and the interior curves “aren’t what you see in every other house.”

The house stayed on the market for about nine months in 2017, priced at $579,000. It then came back on the market in July 2021, at $549,000. The price dropped to $524,000 in September, two months before Zillow Gone Wild posted about the house.

Vol. 45, No. 7 – Crain’s Chicago Business (ISSN 0149-6956) is published weekly, except for the first week in July and the last week in December, at 150 N. Michigan Ave., Chicago, IL 60601-3806. $3.50 a copy, $169 a year. Outside the United States, add $50 a year for surface mail. Periodicals postage paid at Chicago, Ill. Postmaster: Send address changes to Crain’s Chicago Business, PO Box 433282, Palm Coast, FL 32143-9688. Four weeks’ notice required for change of address. © Entire contents copyright 2022 by Crain Communications Inc. All rights reserved.

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