Crain's Chicago Business, September 25, 2023

THE RACE FOR EV INVESTMENTS

Across the Midwest, the battle for EV supremacy is still in the beginning stages I PAGE 13

Local architect eyes restart of tallest tower

Adrian Smith & Gordon Gill Architecture designed Jeddah Tower to be the rst kilometer-tall building

in the world

A ve-year construction shutdown appears to be lifting on a tower in Jeddah, Saudi Arabia, designed to be the world’s tallest — good news for its Chicagobased architect and Chicago’s vulnerable supertall building ecosystem.

Adrian Smith & Gordon Gill Architecture designed what is now known as Jeddah Tower to be the rst kilometer-tall building, at more than twice the height of the Willis Tower. Construction began in 2013 but ground to a halt by 2018 about a third of the way up at the 62nd or 63rd story.

Dubai-based Meed this month quoted a source saying the project is “back in full motion.”

e stoppage was blamed on labor shortages and then the COVID-19 pandemic but also coincided with an upheaval in Saudi Arabia politics, as Crown Prince Mohammed bin Salman consolidated power, purging rivals and later being implicated in the murder of journalist Jamal Khashoggi.

e developer, Jeddah Economic, is inviting 14 contractors, with headquarters ranging from the Middle East and Europe to China, to bid on resumption of the tower, a centerpiece of a sprawling proposed development

See TOWER on Page 20

A retail idol stumbles at Foot Locker

After a star turn at Ulta, Mary Dillon struggles to revive the mall-bound footwear chain

Investors cheered when Mary Dillon took the helm at Foot Locker, expecting her to replicate the stellar results she delivered for shareholders during her eight years as CEO of Ulta Beauty.

Nobody’s cheering now. New York-based Foot Locker’s shares

have dropped by half to around $18 apiece since Dillon joined as CEO last September. at’s a sharp reversal from the 20% boost Foot Locker shares got when news broke that she was coming to the oundering company’s rescue.

Dillon earned a reputation as one of the savviest executives in

MADELEINE DOUBEK

Chicago needs people-powered community maps now. PAGE 2

U.S. retailing when she made Bolingbrook-based Ulta a rare brick-and-mortar success story of the past decade. at reputation is on the line as the Chicagobased CEO nds it harder to revive a mall-based athletic shoe chain than it was to rev up a highgrowth beauty products chain.

Sales at Foot Locker stores

HOME PRICES

open at least a year — a key retail performance metric — dropped more than 9% in each of the last two quarters. e company ipped to a loss of $5 million in the second quarter as revenue fell to $1.9 billion, a 10% drop from the year-earlier period.

See FOOT LOCKER on Page 22

Chicago-area home prices are growing at more than twice the speed of the nation’s. PAGE 3

BEN PEARCE

Steven R. Strahler

Jeddah Tower in 2021

Mary Dillon I GETTY IMAGES

Ally Marotti

Portillo’s expansion plans just got even more aggressive

Portillo’s is boosting its growth goals by more than half, aiming to open at least 920 restaurants around the country in about 20 years.

It’s the rst time the Oak Brookbased hot dog and Italian beef chain has updated its growth goals since going public in 2021, when it was targeting 600 restaurants in 25 years. Portillo’s also increased its annual growth target to 12% to 15% annually from 10%.

Of those 920 locations, Portillo’s projects 800 will be full-scale restaurants and 120 will be pickup, walk-up, or some other format. e company announced the updated goals during an investors meeting last week.

“We are accelerating our growth, but we’re doing it in a very disciplined fashion,” CEO Michael Osanloo told investors.

Portillo’s shares were trading at $15.69 late Friday morning, down about 5% from Sept. 19, when the news was announced.

Executives told investors that the company will only open fullservice restaurants that can do $10 million to $12 million in annual sales. Drive-thru restaurants, which are meant to facilitate online orders and delivery drivers, are targeted to do $6 million to $8 million in annual revenue.

e results Portillo’s is seeing with its newer stores are giving the company the con dence to speed up its growth, Osanloo said.

“We have the playbook in place now to start to accelerate,” he said.

“Our site selection is driving attractive results . . . and it means a lot to us, because we’re still cognizant of the fact that we’re putting a lot of capital, a lot of investor money into the dirt.”

Portillo’s executives have spoken in recent years about rising construction costs as the company works to expand. Chief Financial

O cer Michelle Hook told investors that the cost to build a new location has increased to $7 million from $5 million since Portillo’s went public, mostly due to in ation. e company plans to self-fund its growth, Hook said. It has a $100 million revolver facility it can tap into as needed.

Portillo’s share price has struggled since it went public. Investors expressed skepticism over Osanloo’s plan to remain a price laggard amid in ation that hit the chain’s main ingredients — such as beef — hard. Portillo’s did raise prices to o set its rising costs, but it wasn’t enough to help the stock performance. Portillo’s shares recently were down more than 57% since its IPO.

Likewise, second-quarter revenue and earnings per share missed targets, and store tra c was down. Same-store sales, a growth metric, were up, mostly due to price hikes. Revenues have also risen, largely due to price hikes and new store openings.

Portillo’s has 77 restaurants in 10

states. For the past couple of years, it has been expanding in the Chicago area, Florida and Texas. e company said it will also look to open in Nevada, Georgia and Colorado in the near term. It will also retro t about 40 restaurants this year and next, modernizing them with graband-go stands, self-service beverage options and other tweaks.

e company is also designing its restaurants di erently, with a smaller footprint and shorter production line. Such moves can get customers through the line faster, which ultimately results in more sales.

Osanloo told investors earlier this year that the company was eyeing real estate in airports and other locations where Portillo’s has not ventured before.

Chicago needs people-powered community maps now

Some local nonpro t activists organized a 10-mile weekend bike ride recently through the 27th Ward in Chicago.

Equiticity, the NAACP’s Chicago Westside Branch and my organization, Change Illinois, organized and hosted the ride that featured a route pedaling around the Humboldt Park neighborhood, the former Rockwell Gardens public housing site and the Fulton Market area.

e Rockwell Gardens stop had riders gazing at a weed- and grass-covered concrete basketball court that would be tough for any baller to use. at surely stood in stark contrast to the booming and gentri ed Fulton Market. Yet, these communities are all in the same ward, and the people who live there are all ghting for the same attention and resources from Ald. Walter Burnett Jr.

As Change Illinois’ Community Organizing Director DuShaun Branch Pollard put it on Instagram: “ ese communities all look very di erent. ey each have di erent levels of investment or disinvestment.”

Would it have made more sense to group communities with similar characteristics and economic advantages and disadvantages together? Sure, and that’s partly what the model Chicago Advisory Redistricting Commission — which Change Illinois created and supported with community partners — attempted to do two years ago. Of course, grouping together similarly resourced and

Corrections

economically disadvantaged or advantaged communities isn’t always physically possible, but a better job can be done and was, as evidenced by the publicly drawn People’s Map produced by diverse, average Chicagoans.

How people in communities get mapped together into wards, or how neighborhoods get carved up into multiple wards or districts, absolutely a ects their ability to get help for that run-down basketball court or to get resources to help with a crime-riddled corner. e way we’re mapped a ects how easy or hard it is for us to get organized to get policies approved and practical things like the kinds of grocery stores or retail outlets we want and need in our neighborhoods.

e redrawing of wards and other political districts occurs once every 10 years after each census to generally re ect shifts in population, but the work to end gerrymandering and improve redistricting is hardly a one-and-done, once-adecade exercise.

Battles for fairer representation still are being waged over the maps approved after the 2020 census in Ohio, Wisconsin, Alabama, Georgia, South Carolina, Texas and Florida. People ghting in those states understand the battle absolutely is for voting rights and representation, but it’s also about having voices, choices, resources and a government that responds to them.

In California, residents now have seen two cycles of redistricting done by independent, nonpolitical commissions for their state legislative and congressional seats, and it’s been working for them. Certainly, there’s not a perfect map that is everyone’s

In the Sept. 18 Best Places to Work pro le of Mowery & Schoenfeld, Managing Partner Je Mowery’s last name was misspelled.

In the Sept. 18 Best Places to Work pro le of Camelot Illinois, the voluntary turnover rate was misstated; it should be 8%.

In the Sept. 18 Best Places to Work pro le of Ebco, the voluntary turnover rate was misstated; it should be 10%.

ideal solution, but the rst independent commissioners there drew districts that added to the Democratic majority’s numbers and also resulted in nine more opportunities for people of color to select representatives of their choosing.

Now, California lawmakers are working to grow that good experience to more local governments. One law just approved by both chambers, AB 764, prohibits incumbent-protection gerrymandering, strengthens redistricting criteria and procedures, and extends redistricting protections to more local governments. A second law, AB 1248, requires that California county, city and school governments with districts create and use independent redistricting commissions that are politically

independent and diverse. When it comes to independent, people-powered commissions, California is showing the way. How about we get to work on implementing more of those ideas here?

e hundreds of people who wanted to participate in the open process of creating new wards with the commission we created knew that e ort would produce a better democratic result than alderpeople cutting deals in a back room would, and the people who hopped on bikes, toured parts of the 27th Ward and saw it for themselves know it better than ever now.

“Cycling through the neighborhoods just reinforced the inequities that seem of little interest to alders,” one of the riders said afterward. “Really eye-opening.”

Mayor Brandon Johnson and 17 of the 50 council members who won in the last election pledged to community groups to support more independent ward mapping that works for the people. With the mayor leading and joined by that many council members holding rm in their commitment to fair mapping, there’s a core there to start building toward a better way, an independent commission that works to re ect what best serves the people in all the wonderfully diverse communities of Chicago. Let’s work together to make people-powered community maps happen now.

Madeleine Doubek is executive director of Change Illinois, a nonpartisan nonpro t that advocates for ethical and e cient government.

Madeleine Doubek

The hot dog and Italian beef chain says the U.S. market can handle hundreds more locations than it initially set to open

Ally Marotti

CHICAGO-AREA HOME PRICES GROWING AT TWICE THE SPEED OF THE NATION’S

It’s a complete reversal from a year ago I

By Dennis Rodkin

Chicago-area home prices are growing twice as fast as the nation’s, two recent reports show. It’s the exact opposite of what was happening a year ago.

e median price of homes sold in the nine-county Chicago metro area rose to $339,900 in August, up 9.6% from the same time a year ago, according to data released on Sept. 21 by Illinois Realtors. Nationally, the median price increased 3.9% to $407,100, according to a separate report that day from the National Association of Realtors.

See HOME PRICES on Page 22

Cboe CEO’s exit fuels CME merger talk

Steve Daniels

It’s a rare sight when a wellregarded CEO resigns abruptly over a controversy and the stock rises on the news.

But that was the case with the sudden resignation, announced Sept. 19, of Cboe Global Markets Chairman and CEO Edward Tilly, who left after an internal probe that uncovered undisclosed “personal relationships with colleagues.” e stock, which already had climbed more than 20% so far this year as trading volumes keep topping previous highs, rose 2.75% Sept. 19, closing at $155.87 a share. Volume was about 2.8 times its daily average. Cboe shares were trading around $157 on Sept. 22. e appointment of a 68year-old board member, Fredric Tomczyk, as permanent CEO in the 60-year-old Tilly’s place is fueling investor speculation about Cboe’s future. A couple years ago, CME Group, the futures exchange also based in Chicago, was reported to be interested in a merger.

Could the combination, which would create the world’s leading futures and options house, be something 65-year-old CME CEO Terry Du y could pursue to cap o a decades-long career on Chicago’s trading scene?

A CME spokeswoman had no comment.

It was a little over two years ago

that CME categorically denied a report in the Financial Times that it had reached out to Cboe about an all-stock combination. Since that time, Cboe’s stock has risen 29% while CME’s has increased just 5%.

Whatever Du y’s reaction to this surprising news, there’s no question that Cboe’s future is far less certain than it was while Tilly was at the helm. A decade into the role, Tilly had positioned Cboe well through a series of acquisitions that pushed its trading platform into new global markets. e stock has been among the best performers this year among publicly traded exchanges.

“You are seeing an odd response” in the stock market, said Morningstar analyst Michael Miller.

e appointment of Tomczyk, who joined Cboe’s board four years ago after retiring in 2016 as CEO of TD Ameritrade, as permanent CEO fuels speculation that Cboe might be open to a deal given that that he might not be interested in another long chapter as a corporate CEO, Miller says. “It does lend credence to the sense they might be looking for a buyer.”

If so, the lead candidate by far is CME, he says. Two other potential suitors, New Yorkbased Nasdaq and Atlanta-based

See CBOE on Page 20

Under re, Realtors CEO unveils new workplace policies

The National Association of Realtors, which is based in Chicago, has been at the center of a restorm over sexual harassment claims

Dennis Rodkin

Facing sta calls for him to be red in the wake of a sexual harassment scandal, the CEO of the Chicago-based National Association of Realtors unveiled new policies designed to make employees more con dent in the organization’s handling of bad behavior in the workplace.

Bob Goldberg, one of four top NAR leaders whom sta targeted for ouster early last week, distributed an email Sept. 21 where

he laid out four new policies that he hopes will “promote an environment where everyone feels safe supported and empowered to do their best work,” he wrote in the email.

Goldberg is not accused of sexual harassment, but of allowing an o ce culture to thrive that let former NAR President Kenny Parcell and others engage in harassment. Parcell resigned in late August, after e New York Times published a story detailing a pattern of sexual ha-

rassment attributed to him. Parcell denied the claims.

In the wake of Parcell’s resignation, at least a dozen of NAR’s sta in Chicago and Washington, D.C., called for Goldberg and two other sta leaders of the 1.5 million-member trade association to be red and for Parcell’s replacement as president to resign. In the group’s email, they claimed that upper management knew about and permitted

It’s highly unusual to see a company’s stock price rise after the unexpected departure of a well-regarded chief executive

The National Association of Realtors headquarters building at 430 N. Michigan.

This house on Ashland Avenue in River Forest sold for $860,000 in August.

The Chicago area is outperforming the rest of the U.S. in part because it underperformed during the boom.

COMPASS

Fredric Tomczyk

River Forest yanks permit for long-stalled condos

Dennis Rodkin

River Forest o cials on Sept. 15 revoked the building permit on a heart-of-town condo project that has faced years of delays.

More than ve years after it was proposed with an anticipated move-in date of late 2019, the Sedgwick Properties project at Lake Street and Lathrop Avenue is only partially built. At 4:30 pm on Sept. 15, the village announced it is prohibiting further work on the site.

“We are quite disappointed that this has gotten to this point, that the project has gone on this long and not much has been shown for it,” Jessica Spencer, assistant village administrator, told Crain’s Friday.

e delays have made the site a sore spot for the handsome nearwest suburb. Earlier this month, the Wednesday Journal, a newspaper serving River Forest and Oak Park, called the long-stalled condo project “River Forest’s most thoroughly botched development project ever.”

Marty Paris, Sedgwick’s principal, told Crain’s Monday morning that he is still con dent he’ll complete the project, despite missing the Sept. 15 deadline to set up new nancing for the project, a deadline the village board set up in late August.

“Our focus is getting it recapitalized,” Paris told Crain’s. “We didn’t make it by September 15, but the capital markets are in an unprecedented place.” Bank failures and stagnation in the economy have made it hard for builders to get nancing in 2023.

“I have a high level of condence that we’ll be able to execute recapitalizing and move the project forward,” Paris said.

Control of the property

A previous source of construction nancing left the project, and in 2022, Beverly Bank & Trust, an a liate of Wintrust, approved a $20 million line of credit. Beverly canceled it this year and has sued Paris for return of the $4.2 million he used. Beverly initiated foreclosure in May, according to the Cook County Clerk’s O ce.

e village’s statement said River Forest o cials con rmed last week that the property is now in receivership, indicating Paris no longer has control of the property. at change does not yet appear in the clerk’s records.

In 2016, River Forest approved the site, which at the time held single-story commercial buildings and surface parking, for redevelopment. Sedgwick originally proposed a building with ground- oor retail and 30 con-

dos, with prices from about $600,000 to just under $1.4 million. In subsequent years, it changed to 21 condos.

“ e proof of concept was super-strong,” Paris told Crain’s Sept. 18. He said buyers had put down contracts “on 19 of 21 units, so clearly the market is telling you you have the product.” At least eight previous contracts were canceled by the buyers, he said, but with 12 new contracts in the past year, the number of units spoken for has increased. As of Sept. 18, 16 units are marked as

pending sales on the listings maintained by Midwest Real Estate Data, at asking prices of $630,000 to $1.5 million.

“When we have a fully funded construction loan,” Paris said, “we can complete the project.”

Site conditions

In the meantime, the village’s emailed statement said River Forest o cials “have met with the receiver to discuss the immediate need to improve the condition of the project site,” and that village crews would begin repair-

ing disrupted sidewalks today. An 18-month construction permit issued in February 2022 has expired and o cials are “disheartened that this private development project could not be completed within the 18-month permit time frame,” Cathy Adduci, village president, said in prepared comments that were included in the emailed statement. “We are hopeful that the parties can work out their settlement amicably so that progress can be made in this important area of River Forest.”

BMO to stop making car loans through auto dealerships

BMO is exiting the business of making loans to car buyers through dealerships.

Chicago’s second-largest bank by deposits is phasing out a long-standing business line — and a substantial consumer lending product.

Auto loans have grown dicier for lenders as the prices of both new and used cars rose along with interest rates over the past few years. It’s not uncommon for auto buyers to take out loans with terms as long as eight years.

ere are concerns, too, about growing consumer stress, with more consumers, for example, taking on credit card debt each month rather than paying o monthly balances compared with a year ago.

Toronto-based BMO Financial, parent of the U.S. bank, based in Chicago, is ending car lending through dealers on both sides of the border, the bank said Sept. 18.

It joins several other major U.S. banks that are pulling back.

Cincinnati-based Fifth ird said in July it would reduce lending, mainly in Western states. Providence, R.I.-based Citizens Financial Group announced in June it was pulling out of the business.

“By winding down the indirect retail auto nance business, we have the ability to focus our resources on areas where we believe our competitive positioning is strongest,” a BMO spokesman said in a terse statement.

He declined to say what percentage of the bank’s consumer lending business comes through auto loans via dealers.

Pro and con

For banks like BMO, a disadvantage of lending through dealers is there’s little opportunity to sell other products to those borrowers. e deals tend to be purely transactional.

e advantage, of course, is that arrangements with dealers provide a low-cost means of adding earning assets to the balance sheet.

BMO’s U.S. consumer loan portfolio totaled 58.7 billion Ca-

nadian dollars as of July 31, according to investor disclosures, roughly $44 billion in U.S. currency at today’s exchange rate. At CA$1.3 billion, BMO’s U.S. credit card operation is minuscule. Mortgages account for another CA$24.2 billion. at leaves the majority — CA$33.2 billion — tied up in various types of consumer installment loans, which

include car loans.

For BMO’s U.S. bank, gross impaired consumer loans — credits that are delinquent or at signicant risk of default — soared to CA$343 million as of July 31 from CA$188 million as of Jan. 31. e bank doesn’t delineate which categories of consumer loans are souring.

e BMO spokesman empha-

sized that the bank will continue to make auto loans to its own customers.

He declined to say how many job losses are tied to the decision to halt auto loans through dealers.

“We are working closely with a ected employees to provide support and to ensure they are treated with fairness and respect,” he said in the email.

The developer of a stalled project failed to meet a deadline to line up new nancing

The Sedgwick Properties project at Lake Street and Lathrop Avenue in River Forest CASSANDRA WEST

As Chicago’s second-largest bank by deposits quits the business, what does this say about the economic health of the U.S. consumer?

Steve Daniels

Rita Sola Cook President, Bank of America Chicago

Economic impact study touts bene ts of a new NU stadium

Some Evanston residents and City Council members still aren’t convinced

e city of Evanston on Sept. 15 published its economic study of Northwestern University’s proposal to rebuild Ryan Field, highlighting the overall economic bene t it contends the city stands to gain should the stadium project move forward.

e report echoes similar, though more modest, ndings from another independent impact study published by Northwestern in November.

“It is not often a stadium is offered to a community with virtually no cost to the host community,” begins the report, conducted by Johnson Consulting.

“ e costs borne by the city to have the stadium in the community are believed to pale in comparison to the bene ts received — notably no debt service and no ongoing operating cost liability,” the report later concludes.

e ndings, which look at the stadium’s impact when hosting three and six concerts per year, show an increase in the yearly economic impact for Evanston.

e stadium’s best historical year will generate around $47.2 million

in direct and indirect spending, according to the report. ose gures increase to $66.7 million and $77.8 million, respectively, when three and six concerts are added to the schedule.

e number of Evanston jobs would also increase, from 310 at its current historical best to 440 and 510, respectively.

e study goes on to quantify the overall scal impact the city stands to gain from tax revenue.

e historical best has been around $2.3 million a year in taxes. e report actually shows a decrease with three concerts, to around $2.2 million, with that level increasing to $2.5 million in taxes with six concerts.

“Compared to the other schools in the Big Ten Conference, Ryan Field is the smallest and most outdated,” the report goes on to note. “If the city desires a new source of revenue as well as an improved community asset, the redeveloped stadium would meet those needs, especially with the additional concerts and special events.”

But the proposal to add concerts has been a lightning rod of controversy since Northwestern

unveiled its stadium plans last year, mobilizing the formation of oppositional nonpro ts and bringing residents out in force to public meetings.

e school has felt the pressure, reducing its initial proposal of 12 concerts a year down to six, all while maintaining the concerts are necessary to pay for the operational costs of the stadium in perpetuity.

Line in the sand

At a recent Land Use Commission meeting in Evanston, the school drew a line in the sand, saying if it did not get approval for its proposed six concerts, then its stadium rebuild would not be able to move forward.

Still, despite the rosy economic outlook in today’s report, not all residents are convinced of the project’s value.

“ e stadium is not going to help any taxpayers at all, anywhere in the city, according to the study,” said David DeCarlo, an Evanston resident and co-founder of a nonpro t that opposes the new stadium. “Part of Northwestern’s argument has been there’s going to be all this kind of trickledown revenue for the city. is study proves that it’s negligible.”

Evanston Ald. omas Su redin, 6th, contends that the report fails to take into account the immediate burden felt by residents neighboring the stadium from effects like increased tra c and noise pollution.

“My obligation is to represent my residents and not to ll hotel rooms in Wheeling or Glenview,” he said, alluding to where most football teams stay when playing Northwestern. “ e report doesn’t take these things into account.”

e report notes “there are a number of questions that remain unanswered in the transportation analysis,” recommending the university supply a revised transportation analysis with more detailed operations plans “to provide condence that the attendees can be accommodated successfully.”

In an email to Crain’s, the university said today’s report “conrmed what we have said since day one and what thousands of supporters have championed: that this is an incredible investment that will bene t the entire community at no cost to taxpayers.”

e Land Use Commission’s next public meeting on the new stadium proposal is scheduled to take place Sept. 27. e commission will then deliver its recommendations to the Evanston City Council, which will have nal approval over the stadium proposal.

Samsung teams up with U of I for chip talent

Samsung is providing $5 million in scholarships to students at the University of Illinois UrbanaChampaign over the next several years in a sign of growing demand for semiconductor talent.

U of I’s Grainger School of Engineering, which ranks in the Top 10 by U.S. News & World Report, has long been a favorite source of talent for chip makers. The school’s faculty include one of the co-inventors of the transistor, the foundation of computer chips, and the inventor of the LED.

The Samsung partnership comes as U of I is launching a semiconductor minor to provide industry-specific education to students majoring in electrical and computer engineering, materials science and physics.

The semiconductor industry is poised to explode. Demand is surging for chips needed for artificial-intelligence applications such as ChatGPT. President Joe Biden also is unleashing more than $50 billion to increase U.S. semiconductor manufacturing as well as research and development.

Samsung has a large semiconductor-manufacturing operation in Austin, Texas, with about

10,000 employees and contractors. The South Korean company is in the midst of building a $17 billion facility north of Austin that will double the headcount.

“Advancing a STEM-ready workforce is a priority for the semiconductor ecosystem in the United States,” Bonyoung Koo, president of Samsung Austin Semiconductor, said in a statement. “We look forward to investing in a top-ranked engineering school and establishing our new relationship with UIUC.”

e company will provide $1 million annually to U of I through 2027.

Samsung isn’t the only chip company that’s experiencing massive growth. Intel is spending $20 billion to build two factories in Columbus, Ohio, that will employ at least 3,000 workers.

“All these companies are expecting to benefit from the CHIPS Act and to bring semiconductor manufacturing back to the U.S.,” says Rashid Bashir, dean of the Grainger College of Engineering. “They are going to need more engineers in their fabs and throughout the supply chain. We’re seeing a rapid increase in interest from companies to hire our students.”

John Pletz

Brandon Dupré

Ryan Field in Evanston. A proposal to add concerts at a rebuilt stadium has been a lightning rod of controversy. JOSHUA SUKOFF/UNSPLASH

How the UAW came to represent so many non-autoworkers

The union’s members include California grad students, Virginia peanut packagers and loofah bath scrub makers in Ohio

Clad in union red with signs reading “UAW on strike,” members of the United Auto Workers union picketing across Michigan recently could have been mistaken for autoworkers on strike at Ford, General Motors or Stellantis.

In fact, they hadn’t walked o the job at an automotive plant, but instead at the state’s largest providers of health care insurance.

More than 1,000 UAW members employed by Blue Cross Blue Shield of Michigan went on strike Sept. 15, demanding wage increases, expanded health care bene ts and an end to outsourcing jobs.

Employees at the health insurer giant are among tens of thousands of non-automotive and nonmanufacturing workers who organize with the UAW. e Detroitbased union’s members include graduate students in California, peanut packagers in Virginia, loofah bath scrub makers in Ohio and sta at the Museum of Modern Art

in New York City.

Over the years, the union has also represented its fair share of members in Illinois, including workers at John Deere — where a 2021 strike took some 10,000 workers o the job for just over a month — Caterpillar, Boeing, Illinois Tool Works and more.

The UAW name remains almost synonymous with U.S. auto manufacturing. But just as the auto industry has declined, so, too, has its dominance within the UAW. With fewer auto workers to represent, the union has sought to diversify its membership portfolio.

“As their membership fell, they have looked for opportunities in other industries,” said Marick Masters, a professor of management at the Wayne State University Mike Ilitch School of Business in Detroit. “They’ve really taken a broader look and realized that the auto industry is a smaller part of the landscape in the country. If they wanted to have a wider impact, they need -

ed to look at expanding their membership base.”

Shift beyond manufacturing

e UAW has long had its hands in non-automotive manufacturing. In fact, “United Auto Workers” is not even the union’s o cial name: It’s the International Union, United Automobile, Aerospace & Agricultural Implement Workers of America.

But the UAW’s shift beyond manufacturing accelerated in the 1970s and 1980s. Just as increased globalization had pushed automotive jobs overseas, white-collar workers were looking to organize. It was in both sides’ best interest to join forces, and so they did.

District 65, for example, was a New York-based union representing nearly 40,000 employees in technical, o ce and professional elds. e group entered into an informal a liation agreement with the UAW in 1979 and became a full member eight years later.

‘’We can use their in uence, their nancial strength and their political

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clout,’’ the District 65 leader said at the time, ‘’and they can use our expertise in the white-collar area.’’ Expansion beyond autoworkers has given the UAW something of a lifeline in recent decades.

“As an organization, if you’re the UAW and you’re looking at your future, you see that you need to look at some other groups or workers to organize,” said Michelle Kaminski, an associate professor at Michigan State University’s School of Human Resources and Labor Relations. “ e manufacturing unions have had to do this as a way to survive.”

In particular, UAW has sought expansion in new and growing in-

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dustries within Michigan. at includes workers at all three Detroit casinos, which opened in the late 1990s and early 2000s.

Non-automotive workers are poised to play an even bigger role in the UAW in the coming years.

“ e UAW is not going to go back to having a million members building cars,” said Erik Gordon, a professor at the University of Michigan Ross School of Business. “It used to be that any car made in the U.S. was made in a UAW plant. at’s not true anymore, and that’s not going to change.” e reality, Gordon said, is that “big growth for the UAW is not going to be in the car business.”

Paul Ainsworth , Cozzini Bros; Lori Altman , Central Baptist Village; Darin Aprat i , Ros e Paving; Boaz Blumovitz , Jewish United Fund; Le Monte Booker , Field Museum of Natural H istory; Jason Bormann , Metropolitan Pier and Exposition Authority; Jeff Brown , Navy Pier ; Matthew Brown , SEKO Logistics; Jennife r Dunleavy , Accreditation Council for Continuing Medical Education; Gary Gordon , Shedd Aquarium; Emma Hershey , Clearbrook; Michelle Hook , Portillo's Hot Dogs; Joel Jorgensen , B2B Industrial Packaging; John Kelly , Huron Consulting Group; Lindy L oyet , Elevate Energy; Wayne Magdziar z , L oyola University of Chicago; Dave Marberger , Conagra Brands; Joel Pomerenk , Car a Collective; Sarah Rigsbee , Farmer's Fridge; Maribel Rodriguez , City Colleges of Chicago; Marcia Rubi n , Music Institute of Chicago; I van Samstei n , University of Chicago Health System; Sue Sel l , Snapsheet; Michael Shapiro , Option Care Health; Lori Sherwood , Parts Town; Patricia Steeves O'Nei l , Rush University ; Nathan Winter s , Zebra Technologies Corporation; Tim Young , NexTerra Wine Co.

Jack Grieve

Tens of thousands of non-auto and non-manufacturing workers organize with the UAW.

BLOOMBERG

West Loop apartment landlord looks to cash out

The offering gives investors another option to own in-demand rental units in the city, but higher interest rates and tight lending are holding back buyers

It’s a tough time to be trying to sell an apartment building in downtown Chicago as high interest rates and a tight lending environment keep buyers on the sidelines. But a West Loop landlord is joining the herd of owners trying anyway.

A venture of Boston-based real estate rm AEW Capital Management has hired brokerage Newmark to sell the Je Jack Apartments at 601 W. Jackson Blvd., according to a marketing yer. e 190-unit property, which was completed in 2015 at the southwest corner of Jackson Boulevard and Je erson Street, was sold for about $82 million — around $432,000 per unit — shortly after it opened.

AEW is testing whether investors think it’s worth that much today, though recent transactions suggest its value may have dropped. ere is no asking price listed for the 15-story property, but sources familiar with the building’s nancial data estimated it could fetch bids of between $60 million and $70 million, based on the roughly $3.7 million in net operating income that marketing materials project it would gener-

ate during a buyer’s rst year of ownership.

It’s not lack of demand that would weigh it down. e building is 94% occupied with an average leased rent that has increased by 4% over the past 12 months, according to the Newmark yer. JeffJack is in the heart of the West Loop, where a run of companies opening o ces has helped fuel a surge in demand from renters. Downtown apartments rents have also never been higher, and an expected slowdown in new supply over the next couple years makes it a compelling time to own apartments in the heart of the city.

But higher borrowing costs could make it di cult for AEW to complete a sale, as buyers and sellers remain far apart on price. at’s a key reason why apartment sales nationwide year to date through July were down 67% from the same period in 2022 to just under $65 billion, according to data from research rm MSCI Real Assets.

More than a dozen prominent apartment buildings downtown have been sitting on the market for months, while a couple that changed hands earlier this year in the Loop and Streeterville fetched

prices that were well below their pre-pandemic values.

Adding to the headwinds has been a reputation problem for Chicago, where rising property taxes and a new mayor pushing for new taxes on real estate and business — such as the proposed hike to the real estate transfer tax — aren’t helping whet investors’ appetites for deals.

e West Loop is also rife with emerging competition for tenants. e submarket has more than 2,000 new units expected to deliver next year, more than all other downtown submarkets combined, according to appraisal and research rm Integra Realty Resources.

More promising data

e West Loop apartment market, however, recently got a more promising data point: e real estate arm of Spanish billionaire Amancio Ortega last month paid nearly $232 million — around $471,000 per unit — for the 45story apartment building at 727 W. Madison St., according to Cook County property records. at was the highest price paid for a downtown apartment building since before the COVID-19 pandemic.

It’s unclear why AEW is putting the Je Jack Apartments up for sale, and a spokeswoman for the company did not respond to a request for comment.

It’s also unclear how much AEW paid to acquire the building. AEW in 2020 took control of the venture that owned the property from Chicago-based LaSalle Investment Management, according to real estate information company CoStar Group. LaSalle, the investment arm of Chicago-based real estate services giant Jones Lang LaSalle, had acquired the building in the 2015 transaction from its developer, a joint venture between developer omas Roszak and technology executive Dan Moceri.

A spokesman for LaSalle Investment Management did not re-

spond to a request for comment.

Newmark is playing up the Je Jack Apartments’ 17,000-plus square feet of amenities. Among other features, the building includes an indoor pool with retractable glass walls, the yer said. e building includes a mix of unit types with an average apartment size of 718 square feet and average rent of $2,548 per month, according to Newmark.

AEW owns a number of other properties in the Chicago area, including a 16-story o ce building it bought in 2015 at 525 W. Van Buren St., a few blocks from the Je Jack Apartments.

Newmark’s Chuck Johanns, Liz Gagliardi and Susan Lawson are marketing the Je Jack Apartments on behalf of AEW.

Lender seizing Palmer House retail space

A sheriff’s sale of the State Street property last week showed the decimation of retail real estate values in the wake of the COVID pandemic

As a massive foreclosure lawsuit against the owner of the Palmer House enters its fourth year, the hotel’s State Street retail space is poised to be seized by a lender.

Miami Beach, Fla.-based special servicer LNR Partners submitted the high bid of $29.5 million last week in a sheri ’s sale of the Palmer House retail shops along the 100 south block of State Street, according to Cook County court records. e court-ordered sale came more than two-and-a-half years after Wilmington, Del.based lender Wilmington Trust led a foreclosure complaint alleging the retail property’s owner defaulted on its $62 million loan tied to the space. Wilmington Trust is a trustee representing bondholders in the loan, which was packaged with other mortgages and sold to commercial mortgage-backed securities investors.

Pending court approval, the bid will allow LNR to take title to the retail property, which includes 60,000 square feet of retail shops and a parking garage. LNR oversees the loan on behalf of CMBS investors.

e bid price shows how far the property’s value has fallen in the

wake of the COVID-19 pandemic. Decimated daily foot tra c downtown has hammered business for retailers in the Loop, forcing many to close up shop. Old Navy, Urban Out tters, DSW and other State Street stores that closed during the pandemic pushed the corridor’s storefront vacancy rate to almost 28% last year, up from 15.3% before the crisis, according to data from Stone Real Estate. Beyond the lack of shoppers, higher interest rates over the past year have whittled retail property values even more.

New York-based real estate rm or Equities, which bought the Palmer House hotel in 2005, renanced the retail portion in 2015 with the $62 million loan. e retail property at the time was appraised at nearly $93 million, according to Bloomberg data tied to the CMBS mortgage. e property was 98% leased in 2019 with net cash ow of more than $4 million, Bloomberg data shows.

But the public health crisis hit it hard. By October 2020, the retail property’s appraised value had plummeted below $36 million, according to CMBS loan data. Several tenants have moved out since then, bringing occupancy down below 55% as of the end of July, according to court records. Current tenants

include the Sugar Bliss bakery, Starbucks, Kay Jewelers and Lids, and the retail property generated a net operating loss of $227,653 during the rst seven months of the year, court records show.

A spokeswoman for or did not respond to a request for comment, and a spokesman for LNR declined to comment.

e pending Palmer House retail shops seizure comes as or battles a $338 million foreclosure lawsuit involving the 1,635-room hotel itself, one of the largest local foreclosure cases in years when it was led in August 2020.

Annex property lawsuit

A Cook County court issued a judgment of foreclosure against or roughly 14 months ago, teeing up what the lender expected to be a sheri ’s sale of the city’s second-largest hotel a month later. But that auction has been delayed as or and the property’s court-appointed receiver have sought to settle a related squabble detailed in a separate lawsuit.

At issue in the complaint, which was led in July, is the use of a socalled “annex” property attached to the hotel that houses equipment controlling the hotel’s air conditioning and telecommunica-

tions services, among other operations. After or originally acquired the hotel, it separated the hotel, retail and annex into separate ownership entities, and set up a licensing agreement in which or’s hotel venture paid a fee to its annex venture for use of the equipment.

Terms of that agreement stated that it expired in 2018, according to the complaint, but or last year demanded payment of nearly $900,000 from the hotel entity — which is now controlled by the receiver — for its use of the annex over the past few years. or threatened to cripple the hotel’s operations by removing equipment from the annex, the lawsuit alleged. e receiver is asking a Cook County judge to rule that the

licensing agreement has not only expired, but that it does not supersede a reciprocal easement agreement that governs the hotel’s use of the annex.

It’s likely the annex matter will have to be resolved before the hotel will be scheduled for a sheri ’s sale. or’s Chicago focus over the past several years has been in the Fulton Market District, where it developed a new headquarters for snack maker Mondelez International at 905 W. Fulton St. e rm sold that property in 2020 to a German investor for a record-high price per square foot for a Chicago o ce building. or also developed a 450,000-square-foot o ce building at 800 W. Fulton St. that is anchored by dental practice services company Aspen Dental.

Danny Ecker

Danny Ecker

The JeffJack Apartments at 601 W. Jackson Blvd. I COSTAR GROUP

The Palmer House retail shops I GOOGLE

Sterling Bay looks to sell building near Lincoln Yards

A month after selling off one property close to the stalled $6 billion megaproject, the developer is looking to part with another one

A month after selling a property near Lincoln Yards, Sterling Bay has put another one on the market along the edge of its stalled North Side megaproject.

e Chicago developer has hired brokerage Jones Lang LaSalle to sell a vacant 23,677-squarefoot industrial building at 1860 N. Elston Ave., according to a marketing yer. e property is across the street from the western edge of Sterling Bay’s planned $6 billion Lincoln Yards mixed-use campus. It’s also just steps from a 122,000-square-foot industrial property at 1854 N. Besly Ct. that the developer sold last month.

e move puts Sterling Bay in position to unload another small interest in the area around the 53acre development it envisions along the Chicago River between the Lincoln Park and Bucktown neighborhoods. In addition to spending hundreds of millions of dollars over the past decade acquiring land for what could one day become Lincoln Yards, Sterling Bay bought several properties surrounding it. Controlling those properties helps prevent unwanted uses adjacent to its megaproject and would allow the developer to realize gains in nearby property value once Lincoln Yards is built.

It’s unclear why Sterling Bay listed the Elston property for sale, and a spokeswoman for the company declined to comment. e developer bought the building in 2018 for $5.5 million, according to Cook County property records.

Fierce headwinds

It’s a di cult time to sell any commercial property as higher interest rates keep many buyers on the sidelines, but the listing also comes as the developer battles a severe nancial storm at Lincoln Yards. Sterling Bay’s two primary backers have lost patience with

the lack of progress at the development and are seeking to walk away from the project, sending the developer on the hunt for a new capital partner to nance it. Like many real estate rms, Sterling Bay is also facing erce headwinds with its portfolio of o ce buildings as it grapples with the remote work movement.

e Elston property o ering will test investors’ con dence in the future of Lincoln Yards. JLL is playing up the Elston property as an opportunity for a buyer to control a prime redevelopment site next to the city’s next “It” neighborhood. e building at the southwest corner of Elston Avenue and Cortland Street is close to the Clybourn Metra station, which Sterling Bay aims to replace with a multimodal transit hub. It’s also along the path where Sterling Bay plans to eventually extend e 606 elevated trail to connect it to Lincoln Yards.

More proposals

e property, which housed a music venue for years before it was converted into an industrial building, could potentially be redeveloped with a project as large as 130,780 square feet if a buyer wanted to seek the maximum allowed density on the site, according to the yer.

While Sterling Bay sells o property along Lincoln Yards’ western edge, it is planning to hold and develop sites along the megaproject’s eastern border, which is adjacent to the a uent Lincoln Park neighborhood. e developer has proposed a series of large apartment buildings along Kingsbury Avenue, Southport Avenue and Marcey Street that would bring nearly 1,100 new residential units to the neighborhood.

JLL investment sales brokers

Dan Reynolds, Jack Hubbard and Anna Richardson are marketing 1860 N. Elston for Sterling Bay.

Danny Ecker

1860 N. Elston Ave. (center) JLL

Closing the health equity gap requires collaboration and commitment

Chicago, like many other big cities, is the scene of grim and persistent health disparities, with outcomes ranging from diabetes rates, hypertension, heart disease, and cancer ravaging Black and Brown communities, significantly undercutting life expectancies compared to majority-white neighborhoods sometimes just blocks away.

In fact, the contrasts cut across race, income and region of the city. The latest data from the Chicago Department of Public Health shows that as all residents’ life expectancies dropped following the first year of the COVID-19 pandemic, Chicago saw steeper declines among Black, Latino, Asian and Pacific Islander residents.

Black Chicagoans fare the worst, though. As Crain’s health care reporter Katherine Davis has noted in her coverage, the figures show that as of 2020, life expectancy for Black Chicagoans fell below 70 years for the first time to 69 years, with the gap between Black and white Chicagoans widening to 10 years.

Though the contrast between communities has grown more stark and imbalanced in recent years, the phenomenon of health inequity itself is not new. The burden of disease, injury and violence experienced by disadvantaged populations is directly tied to their social or economic status, geographic location and environment.

We also know what’s led to this problem: structural racism, poverty, neighborhood disinvestment, and poor access to insurance and health care providers.

So why is it that a problem that’s so well documented and, frankly, unjust persists in Chicago and around the nation? And what can be done to move the needle toward fairness and equity?

Those were some of the key questions explored when Crain’s gathered a roomful of community health experts, hospital administrators, care providers and activists together as part of our ongoing Equity live-event series.

A panel that included Sinai Chicago CEO Ngozi Ezike, Advocate National Center for Health Equity President Cristy Garcia-Thomas, West Side United Executive Director Ayesha Jaco, and Chica -

go Hispanic Health Coalition Executive Director Esther Sciammarella tackled these questions and more in a panel discussion moderated by Davis. One of the biggest takeaways from the discussion was the need for even more collaboration with some of the city’s largest and, frankly, best-funded hospitals which can improve the quality of the care they provide within their own facilities by helping smaller, neighborhood-level

health care organizations support disadvantaged Chicagoans’ quality of life before they ever set foot in a hospital door.

Another key point: Sometimes improving health involves more than providing examination and pharmaceuticals. It means being sure patients have a stable place to live, transportation to get them to and from appointments with care providers, and even access to decent food. Ezike pointed to an e ort underway to build low-income housing adjacent to Sinai’s West Side campus as a well to help the hospital’s most vulnerable patients have the safety and stability they need to stay on their meds, get healthful rest, and care for themselves and their families. Sciammarella of the Hispanic Health Coalition spoke of low access to high-quality groceries as a key barrier to health in many neighborhoods of the city.

And while collaboration is a hallmark of the community health work described by the panel and reinforced during the event’s networking session, another theme emerged: There are many organizations doing excellent work, trying to raise up the level of care in neighborhoods throughout Chicago. But, unfortunately, they aren’t always aware of one another’s presence and, therefore, miss opportunities to join forces.

That’s where government has a role to play — to identify which organizations, advocates and practitioners are already on the ground in these neighborhoods, fighting the good fight, and help connect them to one another to better serve the people who need it most.

The entire city has a stake in making this happen. As the Johnson administration gets its bearings, this roomful of health care leaders expressed hope that City Hall can be a strong partner in the fight to make Chicago healthier for all.

Curbing air pollution is a shared mission that resonates with all of us in Illinois. e trucking industry has been playing its part, making signicant strides toward a cleaner and more sustainable future. anks to collaborative e orts with the Environmental Protection Agency, today’s trucks have become not only more fuel-e cient but also remarkably cleaner compared to their predecessors. In fact, the emissions of a single truck from 1988 would now be

equivalent to those of 60 modern trucks. While we’ve made commendable progress, there is still work to be done, particularly in replacing our aging fleet with the latest cleaner and safer models, including electric and hybrid trucks. However, a major roadblock stands in our way: the federal excise tax. Originating in World War I to fund military mobilization, the tax has quadrupled over the decades, now holding the ignominious title of being the largest excise tax on

any product in the country.

Imagine going to the dealership to purchase a new car and being forced to pay a 12% tax on top of the purchase price. at is the reality for business owners, who typically pay an additional $25,000 for a new truck because of the federal excise tax. For a new, low-emission truck, the additional cost skyrockets to nearly $50,000. is is a deal-breaker for most owners when you consider that 90% of U.S. motor carriers are small businesses

that operate six or fewer trucks.

Illinois residents are also paying the price. Because the price tag of newer trucks is out of reach for so many operators, older trucks are kept in service on the roads much longer, and our trucking eet continues to age. Combined with deteriorating infrastructure, more and more vehicles are idling in tra c backups and producing emissions that are contributing to

See TAX on Page 11

NATIONAL CANCER INSTITUTE UNSPLASH

The burden of disease, injury and violence experienced by disadvantaged populations is directly tied to their social or economic status, geographic location and environment.

Repealing this ancient tax will put modern, cleaner and safer trucks on Illinois highways

Historic Bronzeville church up for sale at $800,000

Corli Jay

e historic Tabernacle Missionary Baptist Church, which neighbors and former parishioners have been ghting to preserve, has been put up for sale.

According to the online listing, the 26,000-square-foot building in Bronzeville was listed this month for $800,000. e listing describes the church as “a leader in the local area, not just in the religious community” and further describes the property as creating “a history of service and community development as well over the years.”

e sale of the property includes the vacant lot that sits adjacent to the church at 4130 S. Indiana Ave. that “can be used to build or for additional parking,” according to the

PERSONAL VIEW TAX

From Page 10 our air pollution.

Everyone in Illinois has a stake in seeing the federal excise tax eliminated once and for all. One big win would be for the environment. If pre-2010 trucks were replaced with today’s trucks, emissions would decrease by 83% overnight.

en there’s highway safety. e newest models of trucks include safety features such as automatic braking, stability control, lane departure warning, blind spot monitoring, rear-view cameras, fatigue alert systems and many other capabilities, all proven to prevent accidents and save lives.

Repealing the federal excise tax would be a shot in the arm for the local economy, as well. Truck manufacturers based in Illinois, including Navistar and Lion, would see a rise in orders for new trucks, bene ting many highskilled workers and the suppliers and local businesses that support them. It will also boost an industry that employs more than 350,000 people, which amounts to 1 in every 14 jobs in Illinois.

e Modern, Clean & Safe Trucks Act of 2023 would nally reform the tax code by repealing the outdated federal excise tax, and it is receiving growing bipartisan support in Washington. We hope that Sens. Dick Durbin and Tammy Duckworth will sign on, as well, to reinforce their strong track records on the environment, highway safety and jobs.

More than 70% of Illinois communities depend exclusively on trucks to deliver the things that are essential to them. We are committed to transporting the food, fuel, medicine and other goods that our residents need with the cleanest and safest vehicles available.

But we shouldn’t be penalized with a heavy-handed tax for doing the right thing. Repealing the federal excise tax will help the trucking industry invest in the future with the latest clean and safe vehicles as we commit to cleaner air in Illinois while meeting the high demands of interstate commerce.

Matt Hart is executive director of the Illinois Trucking Association.

listing. Listing agent Emiko Pope of Keller Williams Realty con rmed that the property is being sold by California-based nonpro t Eagle Ledge Foundation, which acquired it in a Cook County sheri ’s sale last year, according to property records.

Two weeks ago, Preservation Chicago presented its suggestion for the property to be designated a landmark to the program committee of the Commission on Chicago Landmarks, said Ward Miller, executive director of Preservation Chicago.

According to Miller, the committee does not disclose when it will make a decision. e process can often “take months or longer,” he said.

Mary Lou Seidel, director of community engagement at Preservation Chicago, has

been working with the church’s congregation to provide documents for the Illinois attorney general to show that the church was acquired by Eagle Ledge illegally as it is not licensed to do business in the state, she said.

“We’re trying to help (the church members) get all the materials scanned and ready for (their) attorney to just see if they can make a case to the attorney general,” said Seidel.

Last month, the Coalition of Black House Museums teamed up with Preservation Chicago in hopes of getting the building landmarked after the church’s doors were boarded up, stoking fears of demolition among neighbors.

At an event outside the church in August, parishioners reminisced about their place of worship and its place in Chicago history,

highlighting gures that visited the church such as Martin Luther King Jr., former President Jimmy Carter and Grammy-winning singer Lou Rawls, who grew up in the church and was the adopted son of its founder, the Rev. Louis Rawls.

"We've had several people that have been successful, really successful, come out of this church," the Rev. John Wesley Moore, a former associate minister at the church, said during the event outside the church.

“( e church is) listed, and (the listing) says it would make a great new church, or a really nice high-rise condo building,” Seidel said. “So they’re marketing it for whoever. ey’re not saying save the church; they’re saying you could tear it down. And that’s an immediate threat.”

ARCHITECTURE / DESIGN

Kahler Slater, Chicago / Milwaukee

Kahler Slater is pleased to announce Julia Jude has joined as Principal and Pediatric Practice Leader for our healthcare market. Julia will lead the continued growth and evolution of pediatric healthcare design and strategy, while fostering client relationships across the United States. She has nearly two decades of experience partnering with children’s hospitals across the country to develop state-of-the-art pediatric strategies which support advanced care models and reduce patient anxiety.

BANKING

Wintrust Commercial Real Estate, Rosemont

Wintrust Commercial Real Estate is pleased to welcome Chris Metcalf as Senior Vice PresidentCommercial Real Estate Lending to our team. Chris brings nearly 20 years of banking experience, working with local real estate developers and owners on various projects, including multi-family, industrial, retail, and of ce properties. Previously with Inland Bank, he has held roles in credit administration and lending, most recently as head of commercial real estate lending.

CONSTRUCTION

Bulley & Andrews, Chicago

Bulley & Andrews is pleased to announce the promotion of Dana Erdman to Vice President, Technology & Innovation. Highly regarded for her visionary approach, Erdman leverages technology tailored to each building assignment. Her talents ensure the technology B&A implements supports well-informed decisionmaking and helps clients achieve clearer visions of their projects.

Sloan Watson has been named Vice President, Marketing. Watson has 25+ years of marketing and client relations experience and leads the rm’s brand positioning efforts with an emphasis on the people behind the projects. Her experience is invaluable in developing winning proposals, amplifying the rm’s expertise and crafting effective messaging.

ENGINEERING

Ardmore Roderick, Chicago

Ardmore Roderick welcomes Shon Yates as Executive Vice President of Energy and Utilities! Shon brings over two decades of expertise in the energy and utility sector, having held key leadership positions in energy trading, procurement and supply chain management, mergers and acquisitions, project development, corporate strategy, and fuel supply and logistics. Shon’s team motivation and transformative abilities support Ardmore Roderick’s growth strategy in the Energy and Utility markets.

HEALTH CARE

City of Hope Chicago, Zion Tulio Rodriguez, M.D., has joined City of Hope Chicago as a hematologic oncologist and Hematology, Bone Marrow Transplant and Cellular Therapy Program director. Board certi ed in hematologic oncology, Dr. Rodriguez brings over 20 years of experience in blood cancer treatment and bone marrow transplantation in the Chicagoland area. He has been widely recognized for his research, including the Leukemia Research Foundation’s Hero of Hope Award. Visit cancercenter.com for more.

NON-PROFIT

Chicago Baseball and Educational Academy, Chicago

Chris Winston has joined the CBEA as Executive Director. Founded by UIC graduate and MLB veteran, Curtis Granderson, the CBEA is dedicated to giving high quality baseball education and mentoring programs to Chicago inner-city youth who may otherwise not have the access. Chris will manage operations and relationships with CBEA partners. Chris provides 25+ years of for-pro t and non-pro t senior leadership experience in the Chicago marketing, sales, professional development, and media arenas.

NON-PROFIT

Uniting Voices, Chicago

Ellen-Blair Chube has been elected Chair of the Uniting Voices Board of Directors. With over two decades of strategic leadership across government and the private sector, Ellen-Blair is a nance executive currently serving as a Partner and Client Service Of cer for the Investment Bank at William Blair. Ellen-Blair shaped profound evolutions in organizational fundraising that helped secure Uniting Voices’ long-term growth and sustainability. Ellen-Blair has served on the Board since 2017.

FULL-SERVICE REAL ESTATE

Baum Realty Group, Chicago

Deena Zimmerman, an award-winning broker with nearly 20 years of industry experience, has joined Baum Realty as a Principal. Deena will focus on national business development and commercial brokerage. Previously with SVN Chicago Commercial, Deena is sought after by brands nationwide for site-selection roll-outs across both Chicagoland and the entire country.

Deena is regarded nationally for her business development efforts and her ability to broker deals across commercial asset classes.

HEALTH CARE

Vivent Health, Chicago / Milwaukee

Vivent Health, a national leader in HIV care and prevention, has named Brandon Hill, PhD as President and CEO. Dr. Hill has been at the forefront of innovation in healthcare delivery for people living with and at elevated risk for HIV throughout his career. In this role, he is focused on ensuring high-quality, inclusive and integrated HIV care and treatment reaches people challenged by adverse social determinants of health to help them live their best lives.

COMPANIES ON THE MOVE

To

HEALTH CARE

American Health Information Management Association (AHIMA), Chicago

Breian Meakens, MPA, MBA, has been promoted to CFO at AHIMA. In this role, she oversees nance, HR, IT, administration, and certi cations. Her career highlights include roles as COO at the Accreditation Association of Ambulatory Health Care, CFO at Christopher House, and VP of Finance at the American Hospital Association. Under her leadership, AHA earned the prestigious Malcolm L. Baldrige Award for Performance Excellence, a testament to her outstanding leadership and commitment to excellence.

LEGAL

Benesch, Chicago

Thomas Hughes has joined Benesch as a Partner in the Firm’s Corporate & Securities and Benesch Healthcare+ Practice Groups. Tom represents public and private companies, private equity rms, portfolio companies and family of ces on a variety of U.S. and cross-border transactions, including negotiated and contested acquisitions, divestitures, leveraged buyouts, joint ventures, strategic investments and key commercial relationships.

HONORS / AWARDS

COMPANY LAUNCHES SHARE

Strategic Change Solutions

Chicago, IL (312) 279-9985 strategicchangesolutions.com

Strategic Change Solutions has been awarded the 2023 Best of Chicago Award in the Business Management Consultant category by the Chicago Award Program. The professional services rm delivers organizational change, wide-scale transformation, and enterprise capability-building solutions to clients across the public, private, and social sectors. “We are honored to receive this award and very grateful to our clients who entrust us to help them create better futures for the institutions and communities they serve,” said Angela Kenyatta, Founder and Chief Executive. Each year, the Chicago Award Program honors exceptional local companies that use their best practices and implemented programs to generate competitive advantages and long-term value.

For

Erdman Watson

STATES PULL OUT ALL THE STOPS IN RACE FOR EV INVESTMENTS

e electric vehicle arms race is on, and it’s still anybody’s game.

Southern U.S. states have captured the lion’s share of more than $100 billion in North American EV investments announced by automakers in the past three years, data from the Ann Arborbased Center for Automotive Research shows. At the same time, Midwestern states have regained some ground.

Michigan went on a spending spree to get back in the mix. Ohio

and most recently Illinois also opened up their pocketbooks to claim a piece of the automotive future. Even Canada, once predicted to be left behind in the EV transition, is holding its own thanks to a federally funded leveling of the playing eld.

In short, the battle for EV supremacy is still in the beginning stages, said Mark Barrott, head of South eld, Mich.-based Plante Moran’s automotive practice.

“We’re probably at the end of the rst quarter,” Barrott said.

“We will need two to three times more battery capacity than what

we have or what’s been announced if we are to meet the projected North American demand.”

That means more than a dozen mega projects (each at least $1 billion in capital expenditures and $75 million in annual payroll) are still on the table, according to a number of economic development officials around the U.S. and Canada who were interviewed for this story and say they are watching those projects like hawks.

Michigan leads states in automaker announced EV and battery-related investment since 2018 with more than $23 billion. Ohio is in the top 5 with nearly $9 billion, while Illinois has only $200 million.

Announced automaker EV and battery-related investments by year

SPONSORS

Kurt Nagl

Some are more desperate to land them than others, and not all projects are created equal. While the strategies and prizes may vary, incentives packages in the hundreds of millions of dollars have become table stakes.

Subsidies, incentives and more

Here’s why: To compete with China and the rest of the world on EVs, the U.S. flooded the domestic market with subsidies, from the Inflation Reduction Act’s $370 billion for clean energy — including a consumer credit up to $7,500 for eligible vehicles — to tens of billions of dollars in grants and loans from the U.S. Department of Energy. The incentives-fueled, win-atall-costs attitude is contagious, it seems.

The industry’s more than $500 billion transition to battery power over the next few years — as research firm AlixPartners estimates the investment to be — sparked a bidding war across North America for factories representing the future of manufacturing and economic security. Skeptics, though, have criticized the massive taxpayer subsidies and questioned the ROI of the projects, which remains to be seen.

It all started in 2021, or at least that’s when many states were put on alert. at year, Ford Motor Co. announced $11 billion of investment in Tennessee and Kentucky, which sent shockwaves through the Dearborn, Mich.based automaker’s home state and made it clear: the Rust Belt wouldn’t simply be entitled to the spoils of resurgent domestic manufacturing.

“It was a game changer and a state changer for us. It’s the largest project ever in our history, even if you account for inflation,” Kentucky Gov. Andy Beshear said in an interview with Crain’s. The same could be said for Tennessee.

Ford’s electri cation overhaul, like those of other automakers, revealed how much states are willing to pay for a project. e $5.8 billion BlueOval SK Battery Park some 50 miles south of Louisville, Ky., is expected to launch in 2025 and create 5,000 new jobs with starting annual pay of $55,000. e twin battery factories are being subsidized by $250 million in taxpayer cash, plus $27 million worth of land provided at no cost.

e cost per job works out to $50,000 when factoring in just state cash incentives. e cost of losing the project, though, would have been immeasurable, as Beshear sees it. “For us, this battle wasn’t just about having the new jobs of the future. It was about making sure we didn’t have displaced workers. … To land these facilities means we will not go through the displacement that we

saw in the energy sector.”

What’s at stake

Losing that Ford project was a major blow to Michigan, and it paid a premium to make sure it didn’t happen again. e state approved an incentives package valued at $1.7 billion — the largest subsidy approved by any state this year — to land the Ford-CATL bat-

rate subsidies. That works out to $3.4 million worth of subsidies per job. In Ohio, the new $3.5 billion Honda-LG plant being constructed east of Dayton is in line for more than $2 million of all-in subsidies for each of 2,200 jobs promised.

projects, frankly, when we were not,” Hundt said.

Illinois incentives

Rivian to take over a shuttered Mitsubishi assembly plant in Normal for about $50 million.

e EV battery race began in earnest a couple of years ago with the rst tranche of investments from Ford, General Motors Co., Stellantis NV and other foreign and startup automakers looking to cash in on North American incentives. Even if unwittingly, Southern states had a head start before battery electric cars in the mainstream were even a consideration.

Southern states were decades ahead in site readiness, but other factors including market dynamics and business climate have inuenced the auto migration south, Barrott said. It’s become more important for automakers to produce batteries and vehicles nearer to where they sell them, for one. Cheaper labor, as plants are largely nonunionized, lower energy costs and taxes, faster permitting, and the lack of United Auto Workers in uence are all major bonuses in the South, too.

tery plant in Marshall, about 100 miles west of Detroit.

Slated to launch in 2026, the $3.5 billion plant promises 2,500 new jobs with starting annual pay of $45,000. at comes out to $384,000 per job when including just cash in the deal.

Factor in federal incentives, and the math is even more staggering. Ford’s plant in Michigan will be eligible for about $6.7 billion in federal tax credits, according to an analysis by Good Jobs First, which tracks corpo -

ose price tags invite plenty of criticism. “ ese deals are less about business and more like giant publicly funded campaign advertisements,” said John Mozena, president of the Center for Economic Accountability, a Michigan-based think tank. Companies are far more concerned with other factors such as labor availability, energy costs, infrastructure and tax structure than subsidies, he argues.

Josh Hundt, executive vice president and chief projects officer for the Michigan Economic Development Corp., said the state had to inject so much cash into the deal because of how far behind it was in prepping mega sites for development. The subsidy included $750 million for building out infrastructure and utilities on the farmland.

“It was necessary for us to be more competitive with these other states that were securing these

After coming up short in a bid to win Chinese battery manufacturer Gotion Inc.’s rst plant, which went to Michigan, Illinois followed its neighbor’s lead and created a $400 million deal-closing fund to go along with legislation that added new tools to the state’s economic-development program speci cally tailored to EV and battery projects.

Among the incentives are tax credits of up to 75% of payroll taxes for new or retained jobs for up to 30 years; and 10% to 25% of employee-training costs. Other incentives include tax credits on 0.5% of a company’s property investment; income taxes connected to construction wages; exemptions from sales taxes on building materials as well as electricity and natural gas.

e e orts paid o . Armed with more than a half-billion in assorted tax breaks, including $125 million from the deal-closing fund, Gov. J.B. Pritzker beat out Ohio and Alabama to land a Gotion battery-assembly plant announced earlier this month.

It’s not quite the bargain deal that Illinois got several years earlier when it lured startup EV maker

“ e art of economic development was really perfected in the Sun Belt, the Southeast primarily, to lure industry away from the Rust Belt and the Northeast,” said John Boyd, principal of e Boyd Co. Inc., a Florida-based rm that consults on site selection for companies including Honda, Boeing and Dell. “We call economic development in 2023 the second war between the states.”

It’s a war the South was winning handily on the EV front before the Rust Belt started making moves. It’s been a costly one for both sides.

Since 2021, southern states have captured nearly 70 percent of automaker EV investment in the U.S., with Georgia leading the way at $20 billion, according to CAR data. Michigan had the second-largest chunk of $14.7 billion. Deal ow peaked in 2022 with nearly $50 billion committed in the states. Less than half that amount has been announced this year.

e southern states that have won the most EV projects in the past three years — Georgia, North Carolina and Tennessee — have netted $38 billion of investment and shelled out $6.7 billion worth of incentives to close those deals.

e winningest states in the Midwest — Michigan, Indiana and Ohio — have secured $28.6 billion of EV investment, greased by $5.6 billion in subsidies.

e level of incentives is unlike anything in the 120-year history of the automotive industry, Barrott said. “It’s not really coming with many strings. If the OEMs and the supply base weren’t driving toward an electric future, it would be a problem, but the OEMs are doing this anyway. What the federal government is doing is speeding it up.”

States like Tennessee were regularly investing in the infrastructure of sites they hoped would eventually house some sort of transformational manufacturing project.

“Tennessee has been in a position to attract these types of projects for reasons that date back decades,” Stuart McWhorter, commissioner of the state’s depart-

“These deals are less about business and more like giant publicly funded campaign advertisements.”

John Mozena, president of the Center for Economic Accountability

Kentucky Gov. Andy Beshear speaks during a Ford Motor Co. event in Frankfort, Ky., in 2021. Ford announced a BlueOval SK Battery Park to be built in Kentucky. | BLOOMBERG

BlueOval City electric vehicle battery manufacturing facility is under construction in Stanton, Tenn. Tennessee is among the Southern states that have won the most EV projects in the past three years thanks to government incentives. | BLOOMBERG

ment of economic and community development, said of the $8 billion of recent EV-related investments in that state. “It’s organically happening. We’ve created a business environment that is attractive not only to the automotive industry but a lot of industries.”

Tennessee did approve $884 million of incentives for Ford’s $5.6 billion, 6,000 job EV investment announced in tandem with its Kentucky plant, but the prize was more valuable than just a battery plant. In addition to battery manufacturing, the project includes an assembly plant and supplier park, making for a far larger job multiplier and economic impact. “What that has meant to that community is generational,” McWhorter said. “It’ll impact families for generations.”

More to come

For now, the industry is calm before another wave of investment, Barrott said. “We always projected a bit of a lull at this point in future announcements of battery facilities,” he said. “Just like any manufacturing operation, you have to build your facility in advance of the actual demand.”

About 850 gigawatt hours of capacity has been announced, is under construction or is in operation, which is enough to ful ll the market through 2029, by Plante Mo-

ran’s estimation. If automakers are to meet ambitious EV sales goals — half of all new car sales in the U.S. could be electric by 2035, according to an S&P Global Mobility projection — they will need to build at least twice as many plants. us, the break in announcements is crunch time for economic developers eyeing those projects still out for bid.

In Indiana, site readiness is also top of mind for economic develop-

ers. e state lured a $2.5 billion Stellantis-Samsung SDI battery plant last year but is on the prowl for more. “ e incentives are still key and king, but the type of incentive is ipped,” said Brock Herr, senior vice president of business development for the Indiana Economic Development Corp. “No longer is nancial incentive the rst priority. Speed is the new best incentive.”

e same goes for Ohio, whose automotive manufacturing prow-

ess is second only to the Motor City state. JobsOhio, the state’s business attraction arm, has more than doubled annual spending on business attraction and expansion in the past three years. e state has also dedicated $750 million for site readiness, with an eye on EVs, said J.P. Nauseef, president and CEO of JobsOhio. “It’s one of our highest priorities,” he said. “We’re sourcing these deals all over the world.”

Like Michigan, Ohio’s exposure to manufacturing raises the stakes of the EV transition, said Jonathan Bridges, managing director, automotive at JobsOhio. “Being the largest producer of engines and second largest producer of transmissions, particularly as we talk about how the industry is in transition, that puts us at risk. We’re actively supporting the transition by diversifying away from ICE (internal combustion engine) technology as well as supporting those investments that are still in that space.”

U.S. states are also feeling pressure from their neighbor to the north. Canada has won about $20 billion of EV investment in the past three years, or more than 14 percent of overall investment. The incentive-rich Inflation Reduction Act legislation blindsided Canada and forced the government to open its cof-

fers to stay competitive, said Vic Fedeli, Ontario’s minister of economic development, job creation and trade.

“It certainly was not in the spirit of the free trade agreement (USMCA), so the IRA would have certainly come as a complete surprise to everyone else in North America,” Fedeli said. “Our federal government announced that we would develop a tax structure that was competitive to the IRA.” at was only after Stellantis forced its hand. In May, the automaker halted construction of its Nextstar battery plant with LG Energy in Ontario, demanding an incentive package as lucrative as those o ered up by the U.S. After a monthslong stando , the Canadian federal government conceded by approving $7.5 billion in tax incentives to match the provincial government’s $3.7 billion.

Fedeli said Canada plans to keep beefed-up tax breaks to win future projects. “ is is our goforward strategy,” he said. “We don’t think you can make an o er that is competitive without it.”

Kurt Nagl writes for Crain’s Detroit Business. John Pletz of Crain’s Chicago Business and Jay Miller of Crain’s Cleveland Business contributed.

Working to advance racial equity and economic mobility for the ne xt generation inthe Great Lakes region.

Ford Motor Co. Executive Chairman Bill Ford in February announced a $3.5 billion investment plan for a lithium iron phosphate battery plant in Marshall, Mich. FORD

Auto industry has a moral responsibility to workers

Igrew up within an hour drive of the auto assembly plants in Tole do, Ohio, and Wayne, Mich., that went on strike earlier this month for fair wages, the elimination of an unjust tier system and a union-built electric vehicle future. For families and communities like mine — as is true throughout Michigan, Ohio and much of the country — the out comes of the strike and UAW’s contract negotiations matter on two levels: they impact my community directly and materially, and they are a bellwether for how the clean economy will look for the workers who comprise it.

e auto industry isn’t new to transformative innovations — it’s built on it. e shift to EVs is no di erent. New technologies to reduce emissions, improve fuel economy, protect drivers and make production lines safer and more ecient are constantly rolling out and transforming auto production. Innovation after innovation, autoworkers take it all in stride. Now, to meet the climate moment, they are ready to build EVs.

at’s part of the reason the United Auto Workers union has gone on strike. e members believe, rightly, that the shift to EVs must not incite a race to the bottom for the quality of auto jobs in the United States.

ere is no good reason that EVs cannot be made in the United States by union workers who are paid family-supporting wages.

Auto workers and climate advocates agree: e transition to EVs is a crucial part of e orts to drive down emissions from transportation and meet climate goals.

at’s why the Biden administration put the force of the In ation Reduction Act behind it. e law includes incentives for automakers to build EVs and their parts here. It also provides billions in grants and loans to keep at-risk or recently closed facilities running, by transforming production lines that were building internal combustion engine vehi-

cles and their parts into production lines building the clean vehicles of the future. ose funds could be used at recently closed facilities like those in Belvidere, Ill., Lordstown, Ohio, and Romeo, Mich.

ese federal investments are working to boost other investments and create jobs. Demand for EVs is exploding and they are selling at record high rates, while investment in EV manufacturing domestically is skyrocketing as well. Since the In ation Reduction Act was signed into law last August, there has been approximately $66 billion of investments announced supporting 60,000 EV manufacturing jobs in 117 facilities around the country. Many of those announcements and jobs are popping up here in the Midwest. In fact, historically, Michigan ranks second for both the total number of announced EV jobs and amount of EV investment, and it leads the nation by a large margin for state and local subsidies supporting EV manufacturing.

It’s a good time to be in the automaking business. But is it a good time to be an autoworker? When it comes to job quality — fair wages and bene ts, job security, predictable hours, a safe work environment, and the free and fair choice to join a union — there is certainly room to improve. ese are the people creating the record pro ts that auto manufacturers are enjoying, and they should be treated with dignity and get their fair share; that is what the UAW is ghting for.

Simply put, we cannot take advantage of the technologies of the future at the expense of the workers today. We all have a moral responsibility to workers and the communities they work and live in. e times and technology may be changing, but what must stay the same is our expectation that opportunities for working families come before executives’ pro ts.

Frank Houston is the Michigan regional program manager for BlueGreen Alliance.

United Auto Workers members (top) picket Sept. 18 outside the Stellantis NV Toledo Assembly Complex in Toledo, Ohio.

UAW members and supporters (above) hold signs and chant during a Sept. 15 rally in Detroit.

A United Auto Workers member on a picket line (left) Sept. 15 outside the Ford Motor Co. Michigan Assembly plant in Wayne, Mich. BLOOMBERG PHOTOS

Illinois in a position to lead this revolution

Throughout our nation’s history, Illinois manufacturers played a key role in nearly every historical and innovation change from the advent of the assembly line, creation of the cell phone, Industry 4.0 and now the electric vehicle revolution. Our state’s rich and historic legacy in manufacturing innovation, along with our amazing attributes, leave us well positioned to lead not only the Midwest, but the entire nation, in this growing sector.

The signs are all around us, with Rivian’s tremendous growth in downstate Normal, Lion’s Electric’s new plant in Joliet that is producing electric school buses and trucks and the recent announcement that Gotion will build a battery factory in Manteno. Smaller suppliers like TCCI, Wiegel and Manner Polymers are expanding.

In Illinois, we risk falling behind unless we take the steps to remain on the forefront of the EV revolution. Fortunately, Gov. J.B. Pritzker and lawmakers are keeping their eye squarely on the ball to ensure we are competitive in this new EV arms race. ree years ago, Illinois struggled to keep up with the competition, but today we are in nearly every discussion because of policy changes.

Competition among states is erce, spurred by billions of dollars in federal money designed to reinvigorate American manufacturing and supply chains in the clean-energy space. e In ation Reduction Act and Bipartisan Infrastructure Law have spawned a new race to attract large factories and their supply chains.

e Illinois Manufacturers’ Association worked with the governor to pass, and later update, the Reimagining Energy & Vehicles Act (REVEDGE), which is showing success, and the Manufacturing Illinois Chips for Real Opportunity Act (MICRO) that focuses on semiconductors and microchips. With workforce challenges facing the industrial sector, the IMA helped create brand-new, state-of-the-art manufacturing academies to train the next generation of workers, including an EV Academy at Heartland Community College. TCCI, a manufacturer of compressors for the EV automotive market, and Richland Community College are partnering with the University of Illinois and Northern Illinois University on a novel EV Workforce Training Academy that will be onsite in the manufacturing facility. Our partners at the Illinois Manufacturing Excellence Center created some of the very rst EV apprenticeship programs in the U.S.

We cannot rest or we risk losing out on

Road to EVs is paved with environmental hazards

Routinely being hit by a waft of fumes that smell of paint upon opening a door or window at home would concern any reasonable person. For Robert Shobe, a longtime resident of Beniteau Street on Detroit’s East side, exposure to potentially hazardous pollutants makes him more than concerned.

He is genuinely afraid.

Having already fought cancer to remission once, Shobe’s health status makes him particularly vulnerable to the adverse impacts of environmental contaminants. As he takes a breath and his burning throat kicks o a persistent cough, he isn’t thinking much about the type of vehicles rolling through Stellantis’ paint booths a mere 300 feet from his back door. He just wants to be able to breathe.

ere is no question that, over their lifetime of use, most EVs emit far less in greenhouse gases than internal combustion vehicles. Sadly, at all levels of government, those long-term bene ts are being pursued at the expense of plant-side communities already bearing the disproportionate burden of our societal pollution. Communities much like Shobe’s. at’s because the production of an electric vehicle emits far more pollution than

a comparable fossil fuel vehicle.

First, the major sources of emissions that exist during the manufacturing of gas-powered vehicles remain unchanged for EVs. For example, the painting process is the same no matter how the vehicle is fueled — the paint booth alone accounts for nearly all volatile organic compound emissions at a plant and 65% of its CO2 emissions.

Similarly, the steel composition of EVs is generally comparable to traditional internal combustion vehicles. Primary steel production in U.S. plants remains reliant on coal and its byproducts, making them some of the worst sources of toxic heavy metal air pollution in the United States. ose industry impacts are not equally shared. Communities supporting steel facilities are among the country’s most socioeconomically and environmentally disadvantaged. en there are the batteries. Lithium-ion battery production requires enormous amounts of energy and resources. Materials like lithium, nickel and cobalt are also in limited supply. at means more emissions from diesel trucks traveling through lowincome neighborhoods and communities of color already exposed to nearly 30%

this revolution. Companies are making decisions now about where they will operate for decades. e IMA is pushing for more worldclass manufacturing academies while embarking on a manufacturing jobs campaign to attract workers to the innovative.

Manufacturers are the largest users of energy, consuming one-third of all energy produced in the U.S. We have lost our competitive advantage during the energy transition, and we need to get it back by investing in the grid along with technologies like nuclear and hydrogen. Illinois needs to streamline its permitting process because companies want to get their shovels in the

ground as soon as possible.

Illinois is positioned to lead the EV revolution and build on our proud auto manufacturing legacy because of its central location, comprehensive infrastructure, excellent colleges and universities, access to water, a global city and airport and highly skilled workforce. e University of Illinois graduates more engineers than the next three schools (Cal Tech, MIT and Stanford) combined, and we have two national laboratories.

Our world is changing before us, opportunities abound, and Illinois is ready to lead.

more diesel pollution than higher-income majority-white neighborhoods.

Suppose manufacturers and our policymakers genuinely care about reducing both the long-term impacts of greenhouse gas emissions and the health of plant-side communities. If that is the case, they must combine the necessity to eliminate tailpipe emissions with a commitment to reducing both the number of vehicles on our roads and the impact of their production on plantside communities. at demands prioritizing investment in mass transit systems, focusing consumer incentives on the least resource-intensive electri ed vehicles and requiring manufacturers to use cleaner ma-

terials, like carbon-free steel and low VOC coatings.

Across the United States, a person’s race is the best predictor of whether they are exposed to elevated levels of industrial pollution. Unchanged, the drive to replace every car on the road with an EV of comparable size will further expand the already enormous discriminatory chasms in health and environmental outcomes in communities already overburdened by pollution.

If we don’t address this now, policymakers and manufacturers will further entrench current inequalities. Sadly, that seems to be the route we’re headed, but it’s not too late for us to do this right.

Mark Denzler is president and CEO of the Illinois Manufacturers’ Association.

Workers build an Amazon delivery truck at the Rivian electric vehicle plant in Normal, Ill. | GETTY MAGES

Three years ago, Illinois struggled to keep up with the competition, but today we are in nearly every discussion because of policy changes.

Andrew Bashi is a sta attorney at the Great Lakes Environmental Law Center.

Steel production plants are some of the worst sources of toxic heavy metal air pollution. BLOOMBERG

Manteno battery plant is rst coup in Illinois EV ambitions

Pritzker sees Gotion win as a springboard to attracting other auto and battery makers to put a stake in the state

Illinois’ success in landing an electric vehicle battery plant came from defeat.

Nearly a year before China’s Gotion Hi-Tech chose Manteno for a $2 billion battery assembly plant, it picked Michigan for a similar factory. Gov. J.B. Pritzker set about persuading lawmakers to authorize a $400 million deal-closing fund and extend the state’s incentives, primarily payroll-tax credits, to last as long as 30 years. e legislation passed in December and January.

e auto industry is set to make a massive and abrupt shift to battery-powered vehicles over the next decade. Any state with a piece of the auto industry has to make that shift, too. In the past two years, companies have announced plans to invest roughly $140 billion in EV and battery plants, compared with $20 billion in the previous two years, estimates Dave Gohlke, an energy and environmental analyst at Argonne National Laboratory in Lemont.

Electric vehicles have far fewer parts, which means many of the manufacturing jobs will involve making batteries. Until Gotion selected Manteno, Illinois was on the outside looking in as other states, such as Michigan and Tennessee, racked up multiple wins.

“Illinois is late to the game,” says Edgar Faler, managing director of the Center for Automotive Research in Ann Arbor, Mich. “ e good news is the game will continue to play out for several years.”

e Gotion factory is the largest economic development project in Illinois since Mitsubishi and Chrysler decided to build an auto plant in Bloomington-Normal in 1985.

Pritzker’s goal is to use the Gotion win as a springboard to persuade others — including automakers with a longtime presence in the state, Stellantis and Ford — to make commitments to build EVs and batteries. Economic-development o cials say there are at least a half-dozen projects that various communities around the state are pursuing.

“Success begets success,” says Pritzker, whose team pursued Gotion for two years. “ is is a signal to other rms in the EV space.”

rough July, Illinois ranked 11th in EV-related investments announced since 2020, according to the Book of Deals published by the Center for Automotive Research.

e Gotion deal likely would put Illinois in the Top 10 but still far behind Michigan, Ohio and Indiana.

“ is is a big win,” John Boyd Jr., a principal with e Boyd Co., an economic-development consultant in Boca Raton, Fla., says of the Gotion announcement. “Attracting this type of battery project puts you in the mix. Pritzker gets credit for revamping the state’s incentives.”

e key was the deal-closing fund, those involved with the negotiations say. It wasn’t necessarily the amount of the check, which came out to about $125 million, signi cantly less than the $175 million Michigan spent to land its Go-

tion plant north of Grand Rapids.

“To have that tool in the toolbox was a game-changer for the state,” says Andy Manar, the state’s deputy governor for budget and economy.

e challenge is to make sure you’re not giving away too much.

“Pieces of the law set up protections for the taxpayers,” Manar says. “ e wage requirement, supplier diversity.”

Tax incentives

e bulk of the Illinois incentives are payroll-tax credits going to Gotion requiring the company to hire 2,600 workers at 120% of the average wage in the Kankakee area, or roughly $55,000 a year.

“When we looked around, other states were just throwing money,” says state Rep. Dave Vella, a Democrat from Loves Park, who was chief sponsor of the state’s EV incentives bill.

His district, in the Rockford area, includes the Stellantis plant in Belvidere, which is idled. State and local o cials are trying to persuade the automaker to commit to making EVs and batteries.

“I think we’re doing it right,” Vella says.

State incentives are only part of the equation. Gotion sought a complete rebate on property taxes, like it received in Michigan, but Manteno Mayor Tim Nugent said no. Gotion is buying a 1.5 millionsquare-foot former Kmart warehouse and 150 acres of land that currently produce about $970,000 in property taxes.

Nugent o ered a compromise.

Manteno will instead cap the tax bill at $2 million a year, which would make it the largest single property-tax payer, Nugent says. At the level of investment contemplated by Gotion, the value of the tax break could be in the tens of millions over the deal’s 30-year life.

“We’re only giving away something we don’t have,” Nugent says. “If they don’t come here, it doesn’t generate any more money than we have today.”

Gotion is a valuable piece of an economic-development puzzle that includes EV assembly, as well as research and development, from homegrown startups to the state’s universities and national laboratories.

“ e ecosystem is there: We’ve got to make the right moves,” says Francis Wang, CEO of Nanograf, a Chicago-based battery startup that hopes to eventually serve the

EV market.

For now, the biggest players are startup EV makers Rivian, which employs 8,000 at the site of the former Mitsubishi factory in Normal, and Lion Electric, which opened an electric-bus plant outside Joliet that expects to eventually have 1,400 workers.

“ ere’s still a way to go for Illinois to become a hub for EVs,” says P.S. Sriraj, director of the Urban Transportation Center at the University of Illinois at Chicago, who has studied the industry supply chain. “You need to have many things come together to make us a power player: having battery manufacturers, having Ford or Stellantis with a presence, working with the electric utility providers on the availability and pricing of electric charging — all that needs to improve.”

Greg Hinz contributed.

John Pletz

China-based Gotion plans to convert a former Kmart facility on a 153-acre site in Manteno into an electric vehicle battery plant. I COSTAR GROUP

Gov. J.B. Pritzker

BLOOMBERG

Illinois has a ways to go to reach its goal of 1 million EVs on the road

Cost is a major barrier to consumers’ adoption, along with concerns about driving range and charging convenience

Illinois has work to do if it wants to meet its goal of having 1 million electric vehicles on our roads by 2030. Local and national consumers are interested in electric vehicles — whether they are hybrids like Toyota’s Prius or those with fully electric batteries, such as Tesla’s line of cars — but signi cant barriers remain to their widespread adoption, according to the Harris Poll’s exclusive AutoTECHCAST survey.

e interest is there. Eight in 10 Americans said they were at least somewhat likely to buy a hybrid (80%) or battery-powered (63%) vehicle, and local attitudes fall largely along the same lines. What’s spurring that interest? Aside from Americans’ love of shiny new technology, a very practical consideration drives U.S. auto-purchases: price.

at was the top response when we asked what vehicle characteristics are most important to consumers: 34% cited it, followed by reliability (29%) and then fuel economy (23%) — with Midwesterners slightly more often than average Americans prioritizing cost (38%) and fuel economy (27%), with reliability clocking in at 28%. How many miles the vehicle gets for the gallon also re ects price concerns: More distance between ll-ups means less paid at the pump.

is priority is both a boon and a problem for EVs. e bene t is

clear: Whether you’re behind the wheel of a hybrid or a fully electric car, you’re going to pay less each month for gas. Electric cars also bene t from federal tax breaks enacted in the 2022 In ation Reduction Act. In fact, the fuel savings and tax breaks were second and third, respectively, among the biggest bene ts consumers identi ed in our poll regarding having electric vehicles.

Americans are aware of EVs’ more ephemeral bene ts, but they don’t prioritize them as much. Environmental impact was 17th on the list of characteristics car buyers looked for, just behind roominess and acceleration, for instance. Improving fuel economy topped the list of technological improvements in which consumers are most interested. Making the vehicle more environmentally friendly came in 18th on that list. But neither type of EV is cheap. Most Americans (61%) plan to spend less than $50,000 on their next car. e gure is almost iden-

tical locally. One problem: e average fully electric vehicle costs more than that. And while hybrid cars start well below that mark, they can cost as much as 20% more than their gas-powered equivalents. Indeed, the biggest obstacles Midwestern consumers identi ed to buying hybrid EVs related to money: ey cited the initial cost as the top reason not to buy hybrid (44%), versus only 20% for fully electric vehicles. e cost of servicing the cars (39% for hybrid, 17% for electric) and whether consumers would save enough to make up the higher price tag (25% for hybrids and 8% for electrics) also are high on the list of concerns for prospective hybrid purchasers.

While those barriers are lower for fully electric vehicles, that class faces additional infrastructurerelated barriers. One in four Midwestern consumers expressed concern about how far such a car can drive on a single charge (25%), how long it takes to recharge (24%) and needing to install a charging station at home (22%).

Americans understand the advantages of EVs, in other words, but remain very practically focused on the bottom line. To the extent that Illinois (and the U.S.) can nd ways to rein in the cost of these vehicles, the state will go a long way toward meeting its million-car mark. But a long road remains ahead of us.

Harris Poll: Purchase likelihood

For your next vehicle purchase, how likely would you be to buy a battery electric or hybrid electric?

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Harris Poll: Purchase considerations

When selecting your next vehicle to buy or lease, what charcteristics of it are more important in making your decision? P lease select up to three characteristics.

William Johnson is CEO of e Harris Poll, a global public opinion polling, market research and strategy rm.

near the Red Sea port city. e winner would succeed the Saudi Binladin Group, whose chairman was among scores of royals, ministers and business people detained for several weeks in a corruption crackdown.

If the mixed-use project incorporating o ce, residential and hotel space goes forward, Adrian Smith & Gordon Gill would negotiate a new contract and put people on the assignment again. So would subcontractors with Chicago-area presences like Environmental Systems Design, engineering rm ornton Tomasetti and life-safety rm Jensen Hughes.

“It’s going to generate a lot of work for those guys, (and) it will be a long time before they can finish,” says Chicago architect Jim Goettsch, who isn’t involved in the tower but whose firm Goettsch Partners has designed other projects in the kingdom, including one temporarily interrupted.

An Adrian Smith & Gordon Gill spokeswoman said the rm wasn’t prepared to comment pending client approval. While he was with Skidmore Owings & Merrill, Adrian Smith was the architect of the Burj Khalifa in Dubai, currently the reigning world’s tallest building, and of Chicago’s Trump International Hotel & Tower. Before the pandemic, Adrian Smith & Gordon Gill also oated a design for a tower o North Michigan Avenue that would have been nearly as tall as the Willis Tower.

Teams with expertise

Many supertall building experts in Chicago from the glory days and after have retired, including Thornton Tomasetti’s Chicago-based lead person on the Jeddah Tower, according to a firm spokesman. “I wouldn’t say the expertise is waning; it’s redirecting,” says the spokesman, James Kent. “Typically, we source projects across multiple offices.”

Adrian Smith Gill & Gordon Gill would have to reassemble an internal team dedicated to the project, according to a person with knowledge of the situation.

Much of that design work has moved overseas from Chicago, the town that invented the skyscraper, and fostered architectural and engineering communities to support high-rise construction. With Chicago’s tallest building having topped out half a century ago, the Middle East and Asia have taken the lead in putting up tall towers, borrowing — and maybe cloning for later — the know-how needed to do it. ose regions are less sensitive to investor sentiment that drives commercial construction in the U.S., though the Jeddah Tower is privatelynanced.

From Page 3

harassment but “did nothing to protect sta ” from the toxic culture that the Times documented.

Now Goldberg has taken steps, along with the organization’s executive committee, to change the workplace culture. About 200 of NAR’s roughly 350 employees work in its Chicago headquarters on Michigan Avenue.

In his email, which an NAR spokesman provided to Crain’s, Goldberg outlined four initiatives. A task force of NAR members will work with a group from D.C.based law rm ArentFox Schi to assess NAR’s policies and procedures around inappropriate behavior and recommend changes that will “promote an environment of transparency and accountability.”

Any claims of harassment, dis-

Environmental Systems Design, which was doing mechanical, electrical and plumbing work on Jeddah Tower, also will get a chance to come up to speed again but under a new owner. In June, ESD was sold to Edmonton, Alberta-based Stantec, with the companies arguing that the deal will reinforce, not dilute, the impact of ESD’s 300-strong Chicago o ce.

“That capability is certainly very much present in Chicago, just looking for the opportunity. It probably won’t be in the U.S.,” agrees Goettsch. Someday, though, overseas opportunities could come under pressure as well for Chicago’s supertall building resources. No U.S. construction company, for example, was invited to bid on

crimination or other misconduct will be investigated by a task force made up of NAR members and people from Evanston law rm Salvatore Prescott Porter & Porter, which has a background in employment law and related matters. NAR sta ers who have complaints about a member’s behavior will go straight to the same Evanston law rm. (Parcell, a Utah real estate broker who became NAR’s president through the volunteer ranks, was a member, not sta .) Details are not yet nalized on new processes for reporting and investigating sta complaints about fellow sta .

ree task forces will investigate NAR’s working climate and report their ndings in November at a national real estate conference called NAR NXT. ree di erent groups will each have a task force: members, sta of state and local realtor organizations, and sta of the national group.

Jeddah Tower’s restart.

Dramatic plans

When his rm was selected as the tower’s architect, Smith likened the “three-petal” design to a “bundle of leaves shooting up from the ground” and “inspired by the folded fronds of young desert plant growth.” Plans called for 167 occupied floors and, counting the spire, 252 stories in total.

Goettsch says, “At the time, it was probably the most dramatic in the kingdom.” But time moves on.

“Now there are several other

“NAR’s leadership is committed to taking concrete actions to strengthen our organization,” spokesman Mantill Williams, vice president of communications, wrote in an emailed statement.

Goldberg’s email did not address the sta call for him, Senior Vice President of Talent Development Donna Gland and General Counsel Katie Johnson to be red and President Tracy Kasper to resign.

Goldberg, who has been at NAR since 1995, is scheduled to retire at the end of 2024.

e sta members’ con dential letter, a copy of which Crain’s received, says, “ e buck has to stop somewhere.” It was delivered to NAR’s executive committee on Sept. 18.

New York Times reporting

e New York Times reported in late August that three women who work in NAR’s Chicago o ce

Intercontinental Exchange, are integrating other big deals and presumably have plenty to do right now without dealing for Cboe.

CME under Du y hasn’t been nearly as acquisitive as other peers, but “realistically they could do an acquisition of Cboe,” Miller says. CME’s market capitalization of $74.4 billion dwarfs Cboe’s $16.7 billion.

A Cboe spokeswoman declines to comment, and the company didn’t make Tomczyk available for an interview. Whenever he speaks before analysts, whether in some near-term special meeting or after third-quarter earnings are reported, he surely will be asked whether Cboe is open to a deal or, conversely, how long he’s committed to remaining in the top job.

Global market leader

A combination of the two surely would result in some job losses but also would cement Chicago’s place as the leading global center for derivatives trading. CME holds a practical monopoly over futures trading in the U.S. Cboe deals with more competition but holds the exclusive rights for trading of Standard & Poor’s 500 Index options and the Cboe Volatility Index options, the VIX, better known on Wall Street as the “fear index.”

major projects with more comprehensive objectives,” he says, such as the King Abdullah Financial District outside Riyadh, Saudi Arabia, which Goettsch likens to a Noah’s Ark of highrise buildings — though with just one of each species.

There is even talk of Norman Foster, the architect of London’s “Gherkin” and the Reichstag’s redo in Berlin, having a twokilometer building on the drawing board. That would top even Frank Lloyd Wright’s midcentury proposal for a mile-high skyscraper. That skyscraper was supposed to be in Chicago.

said Parcell harassed them in different ways. e 16 incidents involving Parcell that the Times investigated included retaliating against one woman after a consensual relationship ended by questioning her authority over her workplace team, sticking his hands down his pants in front of another and texting a picture of his crotch to a third. Parcell denied the report but resigned the next day. e Times article had sources saying harassment is ingrained in NAR’s culture and protected by a tight group of NAR sta .

Goldberg at rst told the Times when asked about alleged sexual harassment at NAR that “I would not characterize it as a problem,” but then followed up with an email through a spokesman that said, “We operate in a society where, unfortunately, inappropriate conduct can occur. Like any organization, we are not im-

Between the two, they would have something of a stranglehold over derivatives for indexed equities — a big market. That could well pique the interest of Biden administration antitrust regulators, but the lack of product overlap between the two companies would offer a defense.

Cboe long has been viewed as an eventual seller in the consolidating and increasingly global world of exchanges. Tilly’s dynamism in the job and acquisitive ways put much of that speculation to rest after the 2021 kerfuffle over whether CME was making a play for the options house.

mune to these challenges, and any single allegation concerns me.”

On Sept. 14, the California rm Great Places to Work decerti ed NAR as a Great Place to Work, a certi cation NAR has had every year since at least 2020. A spokesperson for Great Places to Work did not respond to Crain’s recent query about how far back that designation goes, or how common it is for an employer to be decerti ed.

e letter calling for rings says its writers, who are not identi ed on the copy Crain’s received, “represent all levels of management, in both D.C. and Chicago. We are men and women, some tenured and some new to NAR.” A source told Crain’s there are at least dozen signers to the letter.

“Our leadership has failed us,” the letter says. “We are tired of watching our talented teammates walk out the door.”

The original rendering of Jeddah Tower. I ADRIAN SMITH GILL & GORDON GILL ARCHITECTURE

With Chicago’s tallest building having topped out half a century ago, the Middle East and Asia have taken the lead in putting up tall towers.

Here’s how much Rishi Shah spent on his defense

The Outcome Health co-founder says he should get a new trial because he didn’t have millions more to pay for the lawyers he wanted

Outcome Health co-founder Rishi Shah spent more than $6 million on defense attorneys to ght federal fraud charges, but he wanted to spend much more.

at’s why he deserves a new trial, he says in a new court ling. It’s a curious, convoluted argu ment that underscores how far the millionaire startup founder is go ing to hang onto his money and his freedom for as long as he can.

Here’s how it goes:

Before Shah was convicted in April on more than a dozen charges of fraud, the government froze about $31 million in assets he had received when his company raised more than a half-billion dollars from lenders and venture capitalists in 2016 and 2017.

By the time he was indicted in 2019, much of the money had been invested in his own venturecapital fund as well as other investment funds. But Shah’s attorneys showed that the government improperly froze some investments that had been made prior to the fraud but now are worth about $5 million.

Shah, along with Outcome Health co-founder and codefendant Shradha Agarwal, had attempted to get some of those assets unfrozen several years before trial. ey claimed they didn’t have enough money for the estimated $14 million that their attorneys at the time estimated it would cost to defend them in a monthlong criminal trial.

U.S. District Judge omas Durkin denied their request at the time, and the assets remained frozen; Shah and Agarwal hired di erent attorneys.

Shah claims that not having that untainted money available then to hire the attorneys he wanted violated his Sixth Amendment right to counsel. His new attorney says the fraud charges should be dismissed or he should be granted a new trial.

“Mr. Shah has not only spent millions on substitute counsel, but that counsel also made an unfathomable number of strategic decisions that steered Mr. Shah’s case to where it is today,” Shah’s new attorney, Richard Finneran, said in a ling last week.

“Witnesses have been examined at trial, documents have been produced and defenses have been raised (or abandoned). Whether Mr. Shah’s counsel of choice would have made the same choices is unknowable — and in any event, those bells can-

not be unrung. Dismissal is, no doubt, a drastic remedy. But that is what the law requires.”

Not surprisingly, prosecutors disagree. ey argue that Shah had evidence of what had been seized prior to trial, and he should have challenged it before he was convicted. ey also say he had other funds available that would have allowed him to hire the rm he originally chose.

Agarwal also is seeking a dismissal or new trial on the same grounds. Her court lings indicate she spent more than $2.2 million in attorney fees. It’s not clear how much money might have been improperly frozen, but she and Shah had many of the same investments.

Long shot

eir requests are a long shot, and Durkin likely will rule on them before sentencing hearings, which tentatively are set for next month. eir requests are not formal appeals, but routine posttrial motions led with the trial judge.

Shah, Agarwal and fellow former executive Brad Purdy face up to 30 years in prison for their roles in defrauding investors, lenders and pharmaceutical companies that paid Outcome Health to advertise on its network of TVs and tablets in doctors’ o ces.

e company charged those customers for advertising it did not deliver, which in ated itsnancials that lenders and investors relied upon. Outcome Health was valued at more than $5 billion when the fraud was exposed by e Wall Street Journal nearly six years ago. e company never fully recovered and merged two years ago with rival PatientPoint. Investors, such as Google and Goldman Sachs, testi ed at trial that the value of their investments has been largely written o or completely wiped out.

John Pletz

Former Outcome Health CEO Rishi Shah

FOOT LOCKER

From Page 1

Alarmingly for investors, Foot Locker has twice reduced its fullyear earnings forecast and recently paused dividend payments, a move that will shore up shrinking cash reserves.

“ at will give you a declining stock price, unfortunately,” said David Swartz, senior equity analyst at Morningstar. “It makes the management look really bad. . . . ey underestimated the weakness in their own business, but also the industry conditions.”

Dillon took over a company badly in need of a turnaround. She was tasked with moving Foot Locker away from its shopping mall roots and diversifying inventory at a company largely dependent on Nike. On top of that, Foot Locker faced industrywide headwinds as consumers pulled back spending amid an athletic wear glut.

Some experts hypothesized at the time that the size of the challenge was exactly why Dillon took the job. Her success at Ulta — where annual revenue surged 230% and share price tripled under her watch — appeared to create limitless opportunities for her next act. She was a rumored contender for the top job at Starbucks and was considered a likely candidate for CEO posts at other topshelf companies. Instead, she risked her reputation on a Foot

HOME PRICES

From Page 3

is is a complete reversal from a year earlier, when prices nationwide were up 7.7% and Chicagoarea prices were up only 3.3%.

e Chicago-area price increase is the biggest since July 2021, when prices were up 12.3%, the last double-digit monthly increase in a run that lasted 12 months.

City prices also rose in August, climbing 4.8% from a year earlier to a median of $330,000. At this time last year, the median sale price in the city was at with the previous August. e increase is the biggest since November 2021, when prices were up 10.8%.

e Chicago area is outperforming the nation now in part because it underperformed during the

Locker turnaround.

Dillon o ered some signs of progress on the company’s second-quarter earnings call last month. She reported that brand mix diversity beyond Nike increased to 36% from 31% last year; new, o -mall store formats now represent 12% of Foot Locker’s global square footage, up from 9%; and the company is rolling out upgraded technology to its stores.

“While we’re early in our multiyear journey, we’re con dent we’ll evolve Foot Locker to be a competitive omnichannel retailer and drive sustainable and pro table long-term growth and shareholder value creation,” Dillon said during the call.

Representatives from Foot Locker did not respond to requests for comment.

Getting up to speed

Typically, it takes time for a new CEO to get up to speed, particularly when that person has come from outside of the company, said Harry Kraemer, former CEO of Baxter International and a professor at Northwestern University’s Kellogg School of Management. New CEOs often install new managers, who also must learn the company and reassess its strategy.

“It can easily take a year to really get your arms around it,” he said. “Particularly if the company has had issues before (the new CEO) got there.”

Beyond the challenges Foot Locker faces with its business

boom, when prices here rose by much less than in some parts of the country that in ated like a balloon. As they have zzled, Chicago keeps on keeping on.

Lack of supply

Despite the wide gap between local and national price growth, it’s all the result of one thing: the extreme dearth of homes for sale at a time when buyers are still active. What’s holding back the supply is that the great majority of homeowners have older, sub4% mortgages. Many are reluctant to sell because they’d have to buy their next house with a mortgage interest rate in the 7% range, jacking up the cost of ownership.

“Supply would have to essentially double to moderate home price gains,” Lawrence Yun,

model, Dillon also took over during a di cult time for the athletic apparel sector. e market surged in 2021, as consumers stopped traveling during the pandemic, took up athletic hobbies and spent stimulus money on sports gear. en supply chain problems caused merchandise shipments to stall. By late 2022, shipping problems had largely abated, but inventory problems had taken their place. Retailers were swimming in several seasons’ worth of delayed products that had nally arrived. A glut of athletic shoes and apparel triggered excessive discounting as spending on footwear slowed.

New brands also have risen to prominence in recent years, and the historically Nike-dependent Foot Locker must adapt. Dillon has added hot brands, but unlike at Ulta, where the main competition came from Sephora and declining department stores, Foot Locker faces rivals on all sides.

Retailers like Nordstrom sell the same brands as Foot Locker, and competitors with more product diversity are performing better. Dick’s Sporting Goods’ share price is up about 4.2% since early last September. It all adds up to an ongoing challenge for Dillon.

“Maybe she felt like she had enough success at Ulta that . . . she could go into a retailer that’s struggling and turn it around,” Swartz said. “I think she’s realizing now it’s going to be a much harder road than she anticipated.”

NAR’s chief economist, said in the national report.

Predictably, the inventory shortage weighed heavily on sales volumes. In the metro area, 9,103 homes sold in August, down 15.1% from the same time a year ago. It’s the smallest number of homes sold in August since 2011.

In the city, 2,189 homes sold in August, down 7% from a year ago and the lowest August total since 2011.

Nationwide, sales were down 15.3%. The NAR report does not provide data for historical comparisons.

e Illinois Realtors data uses the U.S. Census Bureau de nition of the Chicago metro area, which comprises Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will counties.

Mary Dillon took over a company badly in need of a turnaround. She was tasked with moving Foot Locker away from its shopping mall roots and diversifying inventory at a company largely dependent on Nike. FOOT LOCKER

At this Bucktown house, the third time’s a charmer

It was designed by an edgy architecture rm, with two reworkings reaf rming its work I

The color panels give the replace wall in this Bucktown house a warm, distinctive character. It didn’t start out this way.

When the house on Wolcott Avenue was built in 1992, the panels were bare birch wood, part of the architects’ use of straightforward, non-precious nishes for a new house in a changing neighborhood. Around a decade later, a round of rehab covered the birch in white paint, part of an updating to make the house feel more grown-up, like the neighborhood.

Another decade passed, and new owners Gale and Gordon Meyer craved color. eir update took the replace panel back to birch and added shades of blue on others. is iteration looks sharp and continues the original architects’ emphasis on the rectilinear geometry imposed throughout the house by the use of another non-precious material, concrete block, for the walls.

e third time’s a charm in this house, rst designed by edgy

By Dennis Rodkin

architecture rm Brininstool + Lynch, reworked in the early 2000s by interior designer and architect Patrizio Fradiani of Studio F and redone once again for the Meyers by Michael Syrjanen Design. All three are Chicago rms.

Now retired — she was in the medical device industry, and he was an instructional designer for Apple — the Meyers are moving to Las Vegas. ey put the four-bedroom, approximately 3,000-square-foot house on the market Sept. 21. It’s priced at just under $1.35 million and represented by Ivona Kutermankiewicz of Berkshire Hathaway HomeServices Chicago.

“ e house is very modern in terms of bringing the outside in,” Gordon Meyer says. ree stories of windows and doors open to a backyard that feels surprisingly secluded, given that the house is only a few doors north of alwaysactive North Avenue restaurants, retailers and bars.

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