Crain's Chicago Business, November 27, 2023

CHICAGOBUSINESS.COM I NOVEMBER 27, 2023

Chicago’s labor market is driving moves to the area Jobs remain a compelling factor in attracting new residents, report says Chicago’s labor market is a compelling pull factor for new residents moving to the city at a time when major metro areas across the country are seeing rates of emigration outpace immigration.

That’s one of the key takeaways from a new Bank of America Institute report looking at regional migration trends and the role new jobs play in Americans’ moving habits. The report analyzed the percentage of direct-deposit customers who moved to a new metro area last quarter and

also had a change in jobs.

Chicago is among the national leaders on that metric with the report finding 13.7% of the city’s newcomers moved for a new job.

The city sits just behind Boston and Portland, Ore., and outpaces other major metros including New York City, San Francisco and Los Angeles when it comes to the percentage of new residents who also shifted employers.

“We wanted to understand which cities attract people because of their job opportunities,” said Anna Zhou, a Bank of America Institute economist and contributor to the report. “When

people move to different places, people always ask, ‘Why are they moving? Are they just retiring, or did they get a new job?’”

Trend differences In Chicago, the answer is more the latter. “Overall, they are still losing population, but the fact that people moving in are coming for jobs does signal that there is potential and that there are certain characteristics that are still attractive for people,” Zhou said.

The report also found workers who moved to Chicago last quarter saw, on average, roughly a 7% increase in their annual salary.

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For established residents of the city who did not move, that number was closer to 2%.

Zhou cautioned that the sample size was limited to Bank of America customers and therefore may not represent the specific numbers writ large, but she does think the report offers a clear look at the relative trend

differences across cities.

“It should be fairly a real-time indicator of where people are moving,” she said. “The relative position across cities is what we focus on here, and we see places like Boston, Portland, Oregon and Chicago are among the places where people are more likely to move there for a job change.”

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CSO nears ticket-sales record, but loses money While some pandemic aftereffects linger, the Chicago Symphony Orchestra recorded its second-highest mark for ticket revenue

By Brandon Dupré

INSIDE: With paid attendance

Bolstered by its first full slate of performances since before COVID-19, the Chicago Symphony Orchestra posted near-record ticket sales, but sank into the red as expenses jumped and government pandemic aid dried up.

The CSO’s latest financial report, released Nov. 13, shows operating revenue at the city’s premier orchestra rose 40% to $29.8 million in the fiscal year ended June 30, thanks largely to rising ticket sales. Revenue from tickets was $22.1 million, up 36% from $16.3 million the previous year, which had 17 fewer paid in-person concerts, and second only to the organization’s record high of $23.3 million in 2018.

Financial support from other sources, such as private donors and government assistance, dropped 4% to $45.8 million, largely due to the end of federal and state aid related to the pandemic, which fell to zero from $10 million in fiscal 2022.

The CSO swung to a $1.4 million operating deficit from an operating income of $1.7 million last year. Driving the red ink was a 15% rise in operating expenses to $77 million, as well as the drying up of pandemic relief funds.

Inflation pushed wages and other costs higher. Chief Financial Officer Stacie Frank also blamed higher operating expenses on the costs of staging more performances, including 81 additional free concerts or events.

The CSO hopes for a continued rise in attendance, which averaged more than 70% of capacity in fiscal 2023.

“We’re in the stage right now where we’re coming back from a pandemic, which is so unusual, but I think we’re coming back really strong and the future’s bright,” said Chicago Symphony Orchestra Association President Jeff Alexander.

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bouncing back, the CSO has reason to toot its horns. PAGE 21

The CSO hopes for a continued rise in attendance, which averaged more than 70% of capacity in fiscal 2023.

Loop office landlord hit with $105M foreclosure lawsuit The 24-story building at 111 W. Jackson Blvd. adds to the deep pool of distressed office properties in the heart of the city

By Danny Ecker

A 24-story building just steps from LaSalle Street has piled onto the heap of downtown office properties in foreclosure as remote work and higher interest rates keep clobbering landlords.

The owner of the building at 111 W. Jackson Blvd. defaulted on its $105 million mortgage tied to the property by failing to make loan payments since May, according to a foreclosure lawsuit filed late last week in Cook County Circuit Court. The 576,774-square-foot building is owned by a venture of New York-based real estate firm Melohn Group, and the complaint was filed by an entity representing bondholders in the loan, which was packaged with other loans and sold off to commercial mortgage-backed securities investors.

It’s another addition to the long list of downtown office buildings poised to be seized by lenders as weak demand for offices and a surge in borrowing costs have pummeled property values. Highprofile towers such as the Civic Opera Building, 161 N. Clark St., the Chicago Board of Trade Building and an array of vintage towers along LaSalle Street are part of a historic wave of distressed properties infecting Chicago’s urban core.

Staring down long odds Led by pain in the office sector, the Chicago area as of the end of September had $7.3 billion worth of distressed commercial real estate, up 71% over the past year, according to data from research firm MSCI Real Assets. That was a much higher jump than the 2 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

44% increase nationally during that span.

Landlords struggling to pay off maturing debt after interest rates spiked over the past year have boosted the Chicago figure. But the Jackson Boulevard building shows that even some owners with loan deadlines several years away are throwing in the towel as they stare down long odds of being able to refinance — especially if it would mean pouring new equity into the property.

The Melohn venture’s $105 million mortgage isn’t due to mature until late 2027, according to Bloomberg data on the loan. But the building has seen its occupancy and bottom line steadily shrink over the past few years.

Equity wipeout When Melohn put the property up for sale in 2019 amid humming demand for downtown offices, the building was 93% leased and had $8.3 million in annual net cash flow, according to Bloomberg loan data. Yet marketing materials at the time showed that about half of the building’s leases were due to expire within five years. The building never sold.

Then came the COVID-19 pandemic and its fallout for the office sector. As of August, the Jackson building was just 65% occupied, loan data shows. The property’s second-largest tenant, investment firm Loop Capital, also executed a termination option last year on its lease and will vacate during the second quarter of 2024, dropping the occupancy to around 60%.

The building’s net cash flow last year was just under $3.4 mil-

lion, well below its pre-pandemic total but still more than Melohn’s roughly $2 million in annual debt service, according to Bloomberg.

A Melohn spokesman did not respond to a request for comment.

A spokesman for LNR Partners, a special servicer overseeing the loan on behalf of bondholders, declined to comment.

Losing the property to its lender

would wipe out a massive chunk of equity for the Melohn venture, which paid $135 million for the building in 2013. The firm spent more than $38 million after that on a lease-up effort and upgrades to the building’s mechanical systems, lobby and amenities, according to the marketing flyer. Melohn then refinanced the property with the $105 million loan in 2017, when it

was appraised at $163 million.

The foreclosure lawsuit comes nearly five months after Melohn President and CEO Alfons Melohn died, according to the Bloomberg loan report. Melohn’s son subsequently took control of the property.

The Real Deal Chicago first reported news of the foreclosure lawsuit involving 111 W. Jackson.

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Rivian lines up $15B bond plan to snag tax break The essentially fictitious sale is necessary as part of one of the largest economic development projects in Georgia’s history

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River City apartments are taken off the market unsold The curvy Bertrand Goldberg building, which went through a contentious condos-to-apartments deconversion, had gone up for sale earlier this year I By Dennis Rodkin

R

iver City, the well-known curving concrete structure on the South Branch of the Chicago River, has been taken off the market by the firm that shepherded it through a contentious deconversion from condos to apartments and an extensive rehab.

A partnership of Marc Realty and Wolcott Group put the 448unit property on the market in April. The building at 800 S. Wells St., designed by the legendary modernist architect Bertrand Goldberg and completed in 1986, is no longer for sale, Ari Golson, a Wolcott principal, confirmed Nov. 14.

After spending about $15 million on rehab and leasing it up to See RIVER CITY on Page 30

“All Chicago got out of this six-plus-year saga was the sacrilegious painting white of a soaring 14-story Brutalist atrium.”

— Dan Pepper, former unit owner

Electric-vehicle maker Rivian Automotive Inc. released what would usually be a startling announcement for the municipalfinance market: A potential $15 billion bond for a Georgia campus, that would in theory be the largest ever muni sale and nearly the size of the company’s market cap.

Except, the bonds aren’t real.

The debt is structured as what’s known as “phantom bonds” that are used by companies to get a property tax break in Georgia, and involve no real financial or accounting impact for the company involved, according to a report by law firm Smith, Gambrell & Russell LLP. In Rivian’s case, it’s a workaround because the state doesn’t have legislation allowing for companies to get abatements that provide such relief.

The massive — yet essentially fictitious — sale is necessary as part of what’s one of the largest economic development projects in Georgia’s history. It’s also indicative of the fierce arms-race states embark on to land massive manufacturing deals that promise high-paying jobs and an economic boon. The company says it will create 7,500 jobs and that once up and running, the facility will eventually produce as much as 400,000 vehicles per year.

The Irvine, California-based Rivian makes electric trucks and sport utility vehicles and is seen as a front-runner chasing market incumbent Tesla Inc. After a blockbuster initial-public-offering in

2021, the company struggled with supply chain challenges and ramping production. It has since managed to accelerate its output from a sole operational plant in Illinois over the course of this year.

The details of the Rivian deal are complicated. The bonds are essentially pseudo-issued through a four-county agency, known as the JDA, located 40 miles from Atlanta, which works to bring economic development to the area.

“The whole concept is set up for a break on the ad-valorem taxes. There’s no cash changing hands, there’s no cash being generated, there’s no movement of money.”

— John Shakarjian, Rivian associate general counsel Under the agreement, the JDA issues the bonds to get a legal title for the project, which it will rent back to Rivian. Then, over the next 25 years, the company will make payments to local governments instead of the full property tax amount, though the payments do take into account local tax rates.

“The whole concept is set up for a break on the ad-valorem See RIVIAN on Page 30

Tax climate in Illinois given its worst grade in a decade

By Jack Grieve

A conservative-leaning think tank that assesses the tax climate in each state is docking its grade for Illinois.

The Tax Foundation, a Washington, D.C.-based nonprofit policy group, released its annual State Business Tax Climate Index report last month. Rather than focusing strictly on how much states levy, the report aims to evaluate how well tax systems are structured.

To compare the vastly different tax codes across states, the report assigns each system an index score based on more than 120 variables that shape its corporate taxes, individual income taxes, sales taxes, unemployment insurance taxes and property taxes.

The criteria favors business-friendly models that minimize tax burdens for individuals and corporations. It emphasizes simplicity, transparency, neutrality and stability.

“The states that rank better on

the index are generally states where businesses are more attracted for investment purposes,” said Tax Foundation Senior Policy Analyst Katherine Loughead.

“They generally treat businesses more favorably.”

This year, Illinois received its lowest index score in the last 10 years. It dropped to No. 37 in the national rankings — down one slot from last year and a far cry from the No. 25 position it held in See TAX CLIMATE on Page 30

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A Washington, D.C.-based conservative-leaning think tank is docking the state’s rating. But there’s one bright spot.

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Crate & Barrel opens NYC flagship The new store in the Flatiron District is designed for the evolving role of brick-and-mortar amid the rise of online shopping

By Ally Marotti

Crate & Barrel opened a new flagship store in New York City’s Flatiron District Nov. 16, hoping to draw shoppers in with exclusive products and experiences.

The new shop comes about eight years after the Northbrookbased retailer shuttered its previous New York flagship on Madison Avenue, and almost six years after it closed its four-story outpost on Chicago’s Michigan Avenue. Offering access to designers and other in-store features — such as a botanical shop, monogramming services, and a Crate & Kids shop-within-a-shop — Crate & Barrel is attempting to draw online shoppers into the store.

CEO Janet Hayes said in a news release that the store represents the future of Crate & Barrel’s brand.

“This flagship store embodies our commitment to inspiring and supporting customers at every step of their home shopping journey,” she said in the release.

“As we continue to invest in our customer experience, we know the ability to experience our brand and services is essential to creating a home with purpose.”

The way consumers shop has changed since the pandemic.

Though online shopping was popular pre-2020, COVID shutdowns pushed more people toward websites and forced retailers to adapt. Many built out their supply chains and added shipping options, such as allowing consumers to buy online and

pick up in store. Brick-andmortar locations have become places where consumers can discover a brand and interact with its products, often scoping out items in store and going home to buy them online. In essence, physical locations in many cases have become marketing vessels.

Other brand locations Retail corridors have shifted as well. More customers shop in their neighborhoods, as opposed to once-bustling downtown strips. In Chicago, for example, Michigan Avenue has seen vacancy rates climb in the past few years as traditional retailers leave the strip. In contrast, neighborhood retail zones such as Damen Avenue in Bucktown or Armitage Avenue in Lincoln Park, have maintained healthy vacancy rates as they attract digital-first retailers or service tenants.

Crate & Barrel’s new location at 881 Broadway is a two-level, 23,000-square-foot store that the retailer’s in-house architecture and design team renovated. They tried to preserve the history of the 1868 building, which was once home to a large department store, according to a news release from the company.

The store’s design desk offers free design and trade services, staffed by up to 30 designers, according to the release. The Crate & Kids shop will be the largest such location yet, with a selection of kids and baby products curated for city parents. The store will also offer one-day delivery.

Crate & Barrel is also launch-

ing a virtual store that is an interactive replica of the new Flatiron location, hoping to reach customers globally.

Though Germany-based Otto Group has owned the company since 1998, Crate & Barrel was founded in Chicago’s Old Town neighborhood in 1962. The company operates 78 Crate & Barrel stores, including seven in the Chicago area. The new Flatiron District store is its only New York City location.

The company also operates brands called CB2 and Hudson Grace. It has 24 CB2 locations and 10 Hudson Grace locations.

It also has 16 outlet stores, bringing the company’s total U.S. store footprint to 126. That count has changed just slightly since 2015, when Crain’s reported the company had 128 Crate & Barrel, CB2 and Land of Nod stores.

Crate & Barrel has shuttered brick-and-mortar stores in recent years, including a San Francisco location that closed in early 2022 due to an expired lease, according to SFGate.

A company representative did not immediately respond to a question about whether Crate & Barrel plans to open another Chicago flagship store.

Retail reinvention Retailers must be willing to reset store strategies if they want to capitalize on growth opportunities, Jill Standish, global lead of the retail industry practice at consulting firm Accenture, said in an email.

“We are seeing increasing ex-

Crate & Barrel’s new flagship store in New York

amples of retailers thinking creatively and innovatively about what the future retail store can be, seeing it not just as a place to purchase products but a multipurpose destination that offers a range of different experiences,” she said. “This reinvention of stores is also about combining online and offline channels into a seamless shopping experience for customers.”

The store is launching just as holiday shopping season kicks into gear. Consumers are expected to spend about 5% less on holiday shopping this year than last year, according to a recent Accenture survey. Many will be looking for ways to stretch their budgets and will be willing to compromise on convenience to do so, such as picking up items in store to save on shipping costs.

Lincoln Park condo tower hits the market The Hampden Green Condominium Association is seeking a buyer to potentially turn the high-rise building into rental units

By Rachel Herzog

A high-rise condo building in Lincoln Park is poised to become apartments, presenting a rare opportunity for multifamily investors that would increase rental stock in one of Chicago’s most desirable neighborhoods.

The condominium board for Hampden Green, a 206-unit property at 2728 N. Hampden Court, has hired Kiser Group to sell the entire property. The condo building is being pitched to investors who would complete what’s known as a deconversion by turning it into rental units.

If the sale closes successfully, it will be the latest in a wave of condos-to-apartment deals that began several years ago and includes the sale of the 28-story Granville Tower in July as well as the 115-unit Barry Quad complex in Lakeview in 2021, both of which topped $30 million. Amid 4 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

an anemic condo market and strong rental demand in Chicago, it’s a trend that appears to be here to stay.

“I’ve come to realize it’s never going to go away,” Kiser Group Senior Director Andy Friedman, who shares the listing with Kiser Group Director Jake Parker, told Crain’s.

Friedman said he expects the property to sell for $200,000 per unit at “the bare minimum,” or at least $41 million, though he and Parker expect final offers to be higher. The deal would be a winwin for both sides, he said: Condo owners would get a higher payout than if they sold their units individually, and investors have the chance to acquire a large building in Lincoln Park, where assets of that size don’t often trade.

The property, built in 1970, is also being marketed as an opportunity for so-called value-add in-

vestors to update the interiors and attract more discerning tenants, Parker said in a written statement.

Marketing appeal The offering could appeal to existing North Side landlords who want to add scale to their portfolio, or to local value-add syndicators or international investors looking for the higher yield that multifamily properties in Chicago offer compared to other areas of the country, Friedman said. While Chicago’s apartment market has cooled down this year, the Windy City remains one of the top metropolitan areas in the country for rent growth.

Pulling off a deconversion can be tricky — the iconic 448-unit River City was recently taken off the market after a pricey rehab, and an investor’s $190 million takeover of a River North highrise, which would have been

2728 N. Hampden Court I KISER GROUP

the city’s biggest condos-toapartments deal, fell apart over the summer.

Under a city ordinance passed in 2019, an investor can only take over an entire Chicago condo building if owners of 85% of the property approve of the sale.

About 40% of the units were owner-occupied, while the other 60% were owned by investors who were renting them out, mak-

ing the building a good candidate for deconversion, Friedman said. The board opted to hire a broker after receiving an unsolicited offer a few months ago, deciding it would be better to solicit offers from the whole market, he said.

“There is a willingness to do it, otherwise we wouldn’t be going through this process,” Friedman said.

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challenges,’ Duly Health names 3 execs

After the hiring of a new CEO, executive departures, layoffs and other cutbacks, Chicago’s largest physicians group adds fresh leaders

By Katherine Davis

Following the appointment of a new CEO and a slew of executive departures, Duly Health & Care, the Chicago area’s largest independent multispecialty physician group, is adding three new members to its leadership team.

Ryan West has been named president of Duly’s Chicago-area operations after serving in the role on an interim basis since July; Dana Rye has joined as Duly’s chief value-based care officer; and Charleen Philips joined as chief accounting officer, the company announced in a statement on Nov. 15.

The executive hires are just the latest changes being made among top leadership at the Downers Grove-based company. CEO Dan Greenleaf joined the company in June as the organization’s third new leader in the past four years.

Soon after, several longtime top executives, including Duly’s chief financial officer and chief operations officer, departed the organization during a C-suite shake-up in August.

Private-equity-backed Duly operates more than 150 locations in Illinois and Indiana. It serves approximately 2.5 million patients, and employs 7,000 people, about 1,000 of whom are doctors.

Broader financial headwinds

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The leadership transitions over the past several months come as Duly faces financial challenges that are afflicting health care providers everywhere. Duly previously told Crain’s that it was battling inflation and elevated patient care costs, which led, at least in part, to the organization needing to institute rounds of layoffs and other cost-cutting measures this year.

Greenleaf declined an interview request from Crain’s but said in the statement that the three new executives will help position Duly for success amid obstacles.

“Our leadership appointments come at a time when our industry and the delivery of healthcare services face unprecedented challenges,” he said. “I have confidence that Ryan’s promotion and the strategic additions of Dana and Char to our team will position us to continue to navigate these challenges and allow us to emerge stronger and more resilient than before to best serve the needs of our patients.

“Duly remains steadfast in our commitment to meeting the evolving needs of our patients,” Greenleaf continued. “With these additions to our leadership team, we are equipped to deliver the very best in health and care.”

Operational duties As president of Chicago-area operations, West will oversee the day-to-day activities at Duly’s more than 120 clinical sites in suburban Chicago. Before taking on this role on an interim basis, West had been Duly’s vice president of operations since 2021.

Prior to joining Duly, West held several leadership roles at other local health systems, such as Ascension and SSM Health Care.

In her new role as chief valuebased care officer, Rye will manage Duly’s value-based care strategy and programs. Valuebased care is a model in which providers are paid for helping patients improve their health, rather than the typical fee-forservice model in which providers are paid based on the amount of services they deliver.

Duly spokeswoman Maria McGowan said the company has been focused on value-based care since 2010, a strategy that allows it to lower care costs.

Rye comes to Duly from U.S. Renal Care, a nationwide dialysis firm, where she was the senior vice president of valuebased care. Prior to that, Rye held leadership roles at OneOncology, McKinsey and Credit Suisse Securities.

Philips, Duly’s new chief accounting officer, comes from HealthComp, a private-equitybacked third-party health benefits administrator, where she was the senior vice president of accounting. She previously was also the vice president and controller at Milwaukee-based Advicent.

Duly’s net revenue last year climbed 41% to $1.98 billion, according to data the company provided to Crain’s. Duly has attributed the growth to acquisitions of medical groups in South Bend, Ind., and downstate Quincy.

McGowan declined to share revenue projections for this year but said that “Duly continues to be well-positioned as a leader in the delivery of health and care services.

“These additions to our team align with our long-term strategic plan and will allow us to maximize our potential,” McGowan said.

How Lurie tripled use of its electronic patient portal The children’s hospital targeted unconscious bias

By Jon Asplund

While trying to find ways to eliminate barriers to parents using its MyChart patient portal, Lurie Children’s Hospital employees discovered that they “had to get out of our own way, first,” says a digital health executive at the Streeterville hospital.

Ravi Patel, vice president of digital health at Ann & Robert H. Lurie Children’s Hospital of Chicago, said the hospital began a digital transformation three years ago, trying to improve, among other things, long waits in the emergency department and an average 40-minute call time for patients, or their parents, to complete calls for appointments.

“That kind of thing leads to limited options and delayed care,” he said. “We had to find a way to be ‘omnichannel,’ to let people access services where they were at, through phone calls, but also the web, through texting, through the portal, wherever.”

But opening up technology to “everyone” proved to be difficult, largely because of the unconscious bias in the organization that stood in the way, Patel says.

One way of getting parents who actually wanted to get off the phone

and onto other more self-scheduling options was simply enrolling them in the MyChart patient portal, developed by electronic health records giant Epic.

The percentage of patients who were using the portal in July 2020, when Patel joined the hospital, stood at about 27%, although it had been available for three years at that time.

Lurie undertook a systemic approach to reduce the effect of unconscious bias in its rollout of the portal, Patel said, which has resulted in 82% of patients, or their parents or guardians, now using the portal.

The first implicit bias Lurie employees had in offering up portal access was limiting who would be encouraged to use it, based on assumptions of who had access to technology, he said.

Closing the gap Instead of thinking a patient’s family might not have technological knowhow or access to things like high-speed internet, wifi or smartphones, “we had to have no judgments, no assumptions. We moved to: Everyone has a chance to use this. Every patient, every time they came to us, we began to send out codes for signing up. That

Ann & Robert H. Lurie Children’s Hospital of Chicago I WIKIMEDIA COMMONS

alone closed the gap dramatically.”

Access to technology, particularly for underserved populations, is a problem, Patel said, but “it wasn’t the biggest problem.”

“Then, we looked at other things, like language barriers,” he said.

“Our expectation of a patient’s family’s ‘preferred language’ is often verbal. However, people’s comfort and ability with written language can be completely different.”

Because it did not offer a Spanish-

language version of MyChart, often Spanish-speaking families were not invited to use the portal, Patel said.

But once everyone was invited to participate, every time, Lurie doubled the number of Spanish speakers on the portal despite not having a Spanish portal, he said.

“We learned that the way to most effectively identify the best way for a patient to interact with us was to simply put it into the patient’s hands,” he said.

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In addition to increasing portal uptake, Patel said, call times, including discussion of the medical issue, scheduling with the proper provider and verifying insurance, now take under 15 minutes.

“We went from the bottom 10% of portal use among Epic clients to the top 10%, just by moving past our own barriers,” he said. “We just had to stop standing in the way of the technology because we were making other judgment calls.”

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@PROPERTIES CHRISTIE’S INTERNATIONAL REAL ESTATE

Naperville home sells for $8 million, setting two records It’s both the highest-priced home sale on record in DuPage County and the highest-priced home sold through an auction, instead of conventionally, in the Chicago metro area I By Dennis Rodkin

A

giant house in Naperville sold for just over $8 million, setting dual records as both the highest home price in DuPage County and the highest price commanded by a home auction in the Chicago metro area.

The house, 15,450 square feet on a little more than half an acre on Van Buren Avenue on the western edge of downtown Naperville, went up for auction in October. The winning bidder closed the deal Nov. 13, paying $8.076 million.

Katie Minott, the @properties Christie’s International Real Estate agent who represented the house along with Kim Marino of the same firm, said there were three bidders in the auction, held online Oct. 16 by New York firm Concierge Auctions.

The sale comes a little over two years after Jane Brooks put the property up for sale conventionally, with an asking price of $15 million. At the time, Brooks told Crain’s that she and her late husband, Don Brooks, “built this house to do kingdom work, for the kingdom of God.” It

was intended, she said, as both a home for the couple and a place for events, fundraisers and overnight stays by visiting pastors or other religious figures, Brooks said.

Crain’s could not reach Jane Brooks for comment on Nov. 14. The buyers are not yet identified in public records. They got a bargain, Minott said, because “it took all of that $15 million to build.”

The next highest recorded amount anyone has paid for a house in Naperville is $4.95 million, a record set 15 years ago, in December 2008. The closest a Naperville transaction has come in recent years is a $4.75 million sale in June 2020.

For DuPage County, the Naperville sale trumps even Hinsdale’s record price. In early 2021, buyers paid just under $7.7 million for a mansion there.

Bucking the trend The sale price is also the highest on record for a single-family residential auction anywhere in the six-county Chicago metro area, where mega-bucks auctions have

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Learn why industry leaders partner with Genesys Works Call our Executive Director, Kim Nicholas at (312) 525-9995 180 N. Wabash Ave., Suite 600, Chicago, IL 60601 | genesysworks.org/chicago 8 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

often fizzled. Most recently, the July auction of a 17,600-square-foot mansion on more than eight acres failed to get the house sold and it went back on the market.

Concierge Auctions, the firm that managed the Naperville sale, had two big flops in the Chicago market during the 2010s, the auctions of Michael Jordan’s Highland Park mansion and a palatial Winnetka home. Jordan’s is still for sale a decade after the unsuccessful auction, and the Winnetka mansion sold conventionally for $8.75 million nine years after the failed auction.

In Naperville, the Van Buren Avenue house, on a little more than half an acre, was designed by Chicagobased Cook Architectural Design Studio, with interiors by Tracy Hickman, also based in Chicago, done in the relaxed, sand-toned look known as Coastal style. It has a facade of stone and stucco, with multiple steeply pitched slate roofs and metal window caps, suggesting an older European home writ large.

The evocation of old times carries inside with white oak floors, some stone walls and fireplaces, roughhewn ceiling beams and white plaster walls. The home also has a gym and a studio that Jane Brooks has

used for making handmade soap.

In the backyard are a swimming pool, an outdoor kitchen, terraces

both under the roof and open to the sky, and a fire pit area with built-in stone benches.

Lonely Planet dubs the Midwest the year’s best travel value Chicago figures prominently in a ranking that’s not just about dollars and cents

By Laura Bianchi

Travel gurus from the popular Lonely Planet guide book, which turns 50 next year, recently anointed the Midwest as “Best Value” on its Best Travel 2024 list, one of two new categories included in its 50th anniversary list. (Sustainability is the second.)

The honor is particularly significant now, says Nitya Chambers, senior vice president of content and executive editor of the Fort Mill, S.C.-based travel guides.

“People are traveling more than ever, spending more than ever, and that is forecast to increase in the coming decade,” she said. “People like to mix and match big expensive trips with more affordable outings so they can travel more.”

The “Best Value” honor is not just about dollars and cents.

“It’s about how much you can take in for the experience you have,” she said. “Chicago and the Midwest really deliver.”

Among their discoveries, Chambers and her team loved Chicago’s hidden gems.

“Chicago is the perfect blend of cool, creative, urban and bustling,

but it also has a quintessential hometown feeling from the neighborhoods — local food, local cheap food, regional and ethnic cuisine,” she said. “You can mix and match experiences so much in Chicago to make your visit your own.”

More than iconic freebies such as Navy Pier, Millennium Park, the architecture and lakefront, Chicago is about “the places you stumble across and the feelings the city evokes,” said Chambers.

Last summer, she took an “amazing” walking tour of graffiti in Pilsen with a local artist, followed by dinner at the neighborhood’s S.K.Y restaurant. “There is so much history and culture tucked away in a 10-block radius. It was exciting and powerful,” she said.

Lake Michigan figured prominently in Lonely Planet’s evaluation. Compared to other cities, Chicago is unique in the way it “cradles the lake, that waterside experience that is instant nature,” said Chambers, who even called out our frigid winters.

“My best friend from childhood lives in Chicago and I love to visit her in January,” she said. “There is a cold in your bones that you can’t

feel in other places. You can duck into a restaurant and eat something decadent and warm, and then go back out for another blast of cold.”

Chicago’s proximity to worthy destinations for a day trip or weekender impressed the Lonely Planet team, too.

“It is a launching pad with potential to go where the horizon meets the road,” including Wisconsin, Michigan and the upper peninsula, Chambers said.

Lonely Planet starts its review process in January, taking nominations from its contributor pool of 700 people around the world.

Chambers and her team debate those and create lists that are “inspirational, actionable and surprising.”

For Chicago, spirit is a major part of its “Best Value.”

“People have so much pride in being from Chicago,” says Chambers, “which results in a warmth that you can’t replicate. It helps you connect to the city.”

This story appears in the ChicagoGlobal newsletter, a joint project of Crain’s Chicago Business and the Chicago Council on Global Affairs.

We hear you.

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All through 2023, we listened — to our clients, teammates and the many communities we serve.

And truly hearing what they would like the power to do helped us strengthen our partnerships — and welcome new ones along the way. From couples just starting out to entrepreneurs looking to launch a business, together we accomplished a lot. We can’t wait to see what 2024 has in store.

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T EDITORIAL

Big Ten responds differently to Northwestern, Michigan scandals

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llegations of wrongdoing tarnish the reputation of a respected university’s athletic department.

Headlines blare the news. Sports talk radio erupts. And a key governing body empowered to oversee the doings and deeds of member sports programs — the Big Ten — takes swift action to investigate the allegations and discipline the coach responsible.

If you followed the hazing scandal that flared up within Northwestern University’s athletic department earlier this year, you might think the scenario above involves the Evanston campus. But no, we’re talking about the much more recent dustup over allegations of sign-stealing by the University of Michigan’s football program, claims that led the Big Ten Conference to suspend Wolverines coach Jim Harbaugh for the remainder of the season.

The accusations against the Wolverines, if true, would amount to a serious breach of the conference’s rules. As The Wall Street Journal reported, the Big Ten on Nov. 10 said it was penalizing the team and its coach “for conducting an impermissible, in-person scouting operation over multiple years, resulting in an unfair competitive advantage that compromised the integrity of competition.” After promising to fight the suspension in court, Harbaugh later agreed to accept it, and the Big Ten then closed its investigation of the matter — though a probe by the NCAA is ongoing.

Big Ten Commissioner Tony Petitti

College football fans will likely argue for years about whether Harbaugh and the team were actually guilty of improperly visiting rival campuses in an effort to steal signs — or whether these were merely the kind of sour-grapes accusations that losing teams tend to make when an opponent is as consistently dominant as the Wolverines have proved to be this year.

And no doubt there will also be bickering over the punishment meted out by the Big Ten: Was it just, or was it overkill?

Let’s set all that aside for a moment, though, and wonder at the proportionality of the Big Ten’s response to the Michigan sign-stealing scandal versus the tales told by student athletes past and present at Northwestern. In a string of lawsuits, former students detail a disturbing pattern of sexualized violence, physical and emotional abuse within several of the school’s athletic programs, and a culture that allegedly turned a blind eye to it for years.

Some of the legal filings make for difficult

reading. The details, if you can stomach them, are there to be read in the multiple complaints filed against the university.

After the initial flurry of complaints arose over the summer, the football season began and the hazing scandal that centered largely on the football program seemed to recede into the background, replaced by the usual scrutiny of the team’s on-field play and further eclipsed by the political clash over the university’s plans to builder a newer, flashier stadium in Evanston. But the lawsuits, laden with multiple distressing allegations, are still there, trundling along through the court system. And many of the coaches who supervised the football program for years — including Dave Braun, who replaced Pat Fitzgerald as head coach after the university cut him loose — are still there as well.

And yet, beyond some mild statements of concern, Big Ten Commissioner Tony Petitti seemed satisfied to allow Northwestern to conduct its own investigation into the hazing allegations and to stay out of the way. Not much outrage beyond that seemed to emanate from the Big Ten’s Rosemont headquarters — certainly nothing on par with the conference’s rapid response to the charges against Michigan.

No doubt the reactions of other conference members had something to do with the divergence in intensity and magnitude. Sexual abuse is one thing, apparently — but sign-stealing is another entirely, and one which evidently cannot be tolerated.

PERSONAL VIEW

How Chicago can become the country’s innovation hub

C

break ground on the $250 million hicago is on a winning Chan Zuckerberg Biohub Chicastreak, as its flagship civic go, a new biomedical research institutions embrace new center that brings together Chipartnerships. cago-area innovators to solve Coming out of the pandemic, major scientific challenges on a the world has a better apprecia10-plus-year horizon. Chicago tion for the importance of won this hub over 58 other nascience-based innovations and tional applicants. how they are needed to tackle soThat same day, at the Chicago ciety’s biggest problems, from cli- Samir Mayekar Venture Summit, more than 800 mate change to public health to is managing clean-energy leaders participated responsible artificial intelligence. director of the in the launch of the Chicagoland With two national laboratories, Polsky Center Climate Investment Alliance, foworld-class research institutions, for Innovation cused on strengthening the recapital and entrepreneurs, Chi- & Entreprecago has the right variables to neurship at the gion’s ecosystem to attract federal funding and support entrepretake on these challenges while University of neurs in technology commercialcompeting for talent and invest- Chicago. ization. The alliance will be locatment globally. And we’re seeing the wins, which are the direct result of col- ed next door to the Chan Zuckerberg laboration between the unique assets the Biohub at Fulton Labs, one of the emerging centers of gravity for science-based inChicago region can offer the world.

Among these, civic and university lead- novation.

Also in October, President Joe Biden ers last month joined Dr. Priscilla Chan to

awarded the Midwest a $1 billion hydrogen hub — with Chicago at the center of the bid — focused on using a spectrum of energy sources to produce hydrogen for a range of industries, from steel production to sustainable aviation fuel. Earlier in the fall, a consortium of Northwestern University and the University of Chicago won $50 million from the National Science Foundation and the Simons Foundation to create the National Institute for Theory & Mathematics in Biology that will be headquartered downtown.

Our infrastructure is also keeping pace with our ambition. If you travel from Hyde Park through the West Loop and north to Evanston, you will see a string of lab facilities that are newly open or well under construction, ready to house the next generation of innovators.

The fall of 2023 has been an inflection point for science-based innovation in our communities. It is a season that should be recognized as a pivotal moment in the his-

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Chicago Business, 130 E. Randolph St., Suite 3200, Chicago, IL 60601, or email us at letters@chicagobusiness.com. Please include your full name, the city from which you’re writing and a phone number for fact-checking purposes.

10 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

tory of Chicago during which our innovation community embraced collaboration and chalked up major wins that position our city, our region and our country to be the hub of scientific breakthroughs that will help the world.

However, to build on this momentum, flagship institutions in Chicago must continue to collaborate. We are only at the tip of the iceberg.

Biden’s 2024 budget proposes a large investment in the nation’s future, including more than $200 billion for federal R&D, of which approximately $18 billion is set aside for R&D in key agencies implementing the CHIPS Act, from the Departments of Commerce and Energy to the National Science Foundation.

We are living in an era of transformative public investment in research and industrial policy that can further position Chicago as our country’s hub for scientific breakthroughs. So let’s keep going — together.

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

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PERSONAL VIEW

Teachers unions win, but kids are hurt in the process

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he Illinois General Assembly’s fall 2023 legislative session is over. And with it go the scholarships low-income families rely on to give their kids desperately needed educational choices.

It’s all because the more than 9,600 kids who were prospering through the state’s tax-credit scholarship program were an existential threat to teachers unions’ monopoly on education — so the teachers unions killed it.

The Invest in Kids tax-credit scholarship program was Illinois’ only school-choice program. It allowed private donors to receive Mailee Smith a tax credit for funding scholaris the staff ships for lowattorney and income children. senior director It was enacted as of labor policy a pilot program at the Illinois Policy Institute. in 2017 but was set to expire at the end of 2023 unless extended.

By all political metrics, the pilot program was a raging success. At least 40,940 scholarships had been awarded since the program launched for the 2018-19 school year. In the 2022-23 school year alone, 9,656 students received Invest in Kids scholarships to attend schools that best fit their needs. As of March, at least 24,000 were on the waiting list for this school year.

In the meantime, funding for Illinois’ public schools has still gone up — by nearly $2 billion since Invest in Kids started in 2018, despite teachers unions’ claims. The tax credits provided through the Invest in Kids program are a drop in the bucket compared to the $10 billion a year going to public schools. And that nearly $2 billion funding boost came despite a more than 6% drop in enrollment statewide since the 2018-19 school year. Public schools are getting more money to educate fewer kids.

In fact, the scholarship program saved the state and school districts money. The revenue lost to the state through the tax credit doesn’t come near the amount schools would have spent, saving more than $12,000 per recipient when government doesn’t have to spend an average of $18,000 to educate each child.

What’s more, the program was wildly popular with voters. A June poll found voters supported the program 3-1, with at least 60% support from each main political party.

Another poll found 71% of Black voters and 81% of Hispanic voters backed it. Still another poll, one conducted by a research firm popular among Democrats, showed all voters, but especially minority and low-income voters, strongly supported the program.

It should have been a political winner. People love it. Money to public schools increased. Low-income families could put their kids in schools that best fit their needs. It’s not every day lawmakers are handed the opportunity to be a part of

something so universally popular.

But one powerful special interest stood in the way: teachers unions.

Threatened by the loss of their monopoly on education posed by the 9,600 low-income students benefiting from the program, teachers unions from around the state and nation poured money and lobbying power into killing the program “for good,” as the Chicago Teachers Union phrased it.

Teachers unions funneled nearly $1.5 million into current lawmakers’ political committees between June 1 and the end of

October, according to records with the Illinois State Board of Elections. That’s a lot of money for unions to spend to kill a relatively small program for the state.

Most of that came from the National Education Association, which contributed $1.1 million since June 1. The Chicago Teachers Union, which came under fire earlier this year for its use of member dues for political purposes, contributed at least $40,500 to lawmakers since June 1. Overall, current lawmakers have received more than $21.5 million from

teachers unions since Jan. 1, 2010.

Apparently money — and re-election with the help of teachers unions — is more important than kids’ needs.

So long as lawmakers keep kowtowing to teachers unions, the needs of students will continue to be forgotten. Teachers unions don’t have the best interest of students at heart. If they did, they would support educational options that benefit low-income students, even if that means putting those kids in private schools — much like CTU President Stacy

Davis Gates and Illinois Education Association chief lobbyist Sean Denney have done with their own children.

Proponents of educational choice must remain relentless in fighting for equitable educational options. Low-income kids deserve the alternatives that fit them best, just like the kids of rich union officers.

Teachers unions may have won this political battle, but we cannot allow them to win a war in which our children’s educations are the casualties.

NOVEMBER 27, 2023 | CRAIN’S CHICAGO BUSINESS | 11

Inside Illinois’ youth lockups, children go without basic services and face ‘excessive’ punishments State audits point to troubling conditions in juvenile detention centers, but no agency has strong enough oversight to bring about change

By Molly Parker, Capitol News Illinois

This article was produced for ProPublica’s Local Reporting Network in partnership with Capitol News Illinois.

In late December, a teenage boy with a broken arm was left to suffer alone in his cell at a youth lockup in rural southern Illinois. Staff were aware he’d been seriously injured; he told them he was in pain and asked to see a doctor. Two hours passed before staff took him to the hospital, during which they cooked and served dinner and took a group of kids for recreation, he claimed.

Almost everything had gone wrong that day, at a place where things went wrong a lot. Four months earlier, a state audit had called the Franklin County Juvenile Detention Center in rural Benton a “facility in crisis” because it was routinely keeping kids locked up for upwards of 24 hours at a time, a “significant violation” of state standards. It had failed to offer them much in the way of mental health or educational services, the audit said. An overwhelmed and undertrained staff routinely called on the sheriff’s department to help keep the youth in line, even for seemingly minor behavioral disruptions, according to additional law enforcement records obtained by Capitol News Illinois

for them, the lawsuit claims, the facility subjected them to “inhumane conditions” known to cause lasting harm.

Melissa Morgan, chief judge of the 2nd Judicial Circuit Court of Illinois, whose office is ultimately charged with running the facility, did not return phone calls seeking comment, though an assistant confirmed she had received the messages. In a court filing last week, Illinois Attorney General Kwame Raoul, who is representing the chief judge and other senior facility staff sued in federal court, denied the allegations of poor care leveled against the facility. The attorney general’s office declined further comment. In a separate filing on Monday, Franklin County, which was also named in the lawsuit, denied the allegations as well.

Youth at the facility said in signed statements taken under oath that the deputies took the boy to the ground, breaking his arm in the process, a claim that is backed up by law enforcement records obtained by Capitol News Illinois and ProPublica.

“The officer asked me about my arm and I said ‘You know it’s broken. You heard it snap,’” the youth who was injured, identified only by his initials, A.B., said in his signed statement. A.B. is not a plaintiff in the suit, though his statement was

Poor conditions in juvenile lockups across the country have recently made headlines, bringing renewed calls for reform. What makes Illinois different from many of its state peers is that no independent agency licenses or certifies the youth detention centers.

All of that was evident on this particular day, when the residents were told they’d get a rare treat, an hour or so inside the facility’s gymnasium.

But once in the gym, the boy got into a shouting match with another youth and staff ordered him back to his room. Devastated to lose his rare gym time, he refused to go. Deputies from the sheriff’s office across the street rushed in — several men who were much bigger than the teen, according to sworn statements that several youth provided for a federal lawsuit the American Civil Liberties Union of Illinois filed against the detention center this summer.

The lawsuit alleges widespread failures, namely that the detention center had violated youths’ constitutional rights by subjecting them to excessive forms of restraint and seclusion while denying them adequate education and mental health services. The children who are confined there are “uniquely vulnerable, many having already suffered harrowing abuse and trauma” — and instead of caring

included as evidence of the poor conditions alleged by the ACLU. The ACLU is seeking class-action status for the case, and that request is pending before a federal judge.

A month after the incident, the Illinois Department of Juvenile Justice returned to the detention center to see whether the “facility in crisis” had corrected any of the deficiencies cited in the August audit. It had made “some improvements” but “several” deficiencies remained and new ones were identified, the auditor wrote in a report on the visit. He also made note of the broken arm, saying that he could find no proof that anyone at the facility had conducted a review to determine whether staff or the deputies had acted appropriately. Franklin County Sheriff Kyle Bacon, who was among the law enforcement officers who restrained the youth that day, defended his department’s actions but said he could not speak to whether the facility had conducted an internal review because the sheriff’s office is not involved in its administra-

tion. Nearly a year later, a spokesperson for IDJJ said the detention center has yet to provide one.

A new analysis by Capitol News Illinois and ProPublica suggests those failures were not unusual. A review of hundreds of pages of state audits, law enforcement records, a federal lawsuit, and reports by oversight and advocacy bodies point to troubling conditions inside many of the state’s 16 juvenile detention centers, which operate much like adult jails, detaining court-involved youth with open cases when a judge determines they are at risk of fleeing or reoffending. The facilities combined can house upwards of 1,200 youth as young as age 10, though they are rarely at capacity.

The records show that youth have been Tased, pepper sprayed and roughed up by staff and law enforcement officers; forced into isolation for days at a time; denied access to their psychotropic medications and mental health treatment; and received little or no schooling, despite state and federal laws mandating that the youth receive educational services while incarcerated. Nearly two-thirds of those who are detained are Black teens.

Poor conditions in juvenile lockups across the country have recently made headlines, bringing renewed calls for reform. What makes Illinois different from many of its state peers is that no independent agency licenses or certifies the youth detention centers. Even in some states that have been heavily scrutinized for problematic conditions inside their youth facilities, such as Louisiana, Tennessee, Michigan and Pennsylvania, a licensing process is in place that allows for sanctions up to closure.

Under state law, the Illinois Department of Juvenile Justice sets standards for county detention facilities that hold youth in custody and conducts audits of them. While the department has repeatedly cited several centers for failing to meet its standards, under state law, IDJJ cannot mandate corrective action plans, issue fines or shut down detention centers found in repeated violation of the rules. Instead, the IDJJ reports are sent back to the county detention facilities’ staff and to the chief judges of each judicial circuit, under whose authority they operate. Neither the staff nor the judges are obligated to respond.

IDJJ shares oversight of the youth detention centers with the Illinois Supreme Court. The high court’s administrative arm implemented its own set of standards for facilities in 2022 and started conducting reviews later that year. In its initial review of the detention centers, the court found that about a third did not meet its standards, and action plans were developed with them to address deficiencies. Christopher

Bonjean, a spokesperson for the Illinois Supreme Court, declined to provide the full reviews or any of the ongoing progress reports for facilities requiring action plans, saying that only its initial summary reports are made public. The judicial branch is not subject to the Illinois Freedom of Information Act. Juvenile justice experts and advocates for incarcerated youth in Illinois say the weak oversight of these facilities needs the attention of lawmakers and policy experts.

And it’s the latest example the news organizations have revealed about the failures of Illinois officials to put an end to the poor treatment of vulnerable populations held in facilities, even when problems are well documented.

Capitol News Illinois spoke with six experts in the field of juvenile justice and youth development who said facilities that detain children should have robust oversight structures. This spring, Equip for Equality, Illinois’ federally designated legal aid organization for people with disabilities, called on policymakers to reform the oversight system “given the longstanding, serious and pervasive problems” inside facilities statewide.

“Would you want nursing homes operated without any oversight? I don’t want nursing homes operated without oversight. So to think we don’t have any kind of oversight and quality improvement for kids that are in custody in a facility, I don’t understand,” said Hunter Hurst, director of the National Center for Juvenile Justice, the research arm of the National Council of Juvenile and Family Court Judges.

IDJJ Director Heidi Mueller said in an interview that she agrees that the agency is limited in what it can do if a county’s chief judge can’t or won’t enforce compliance.

“I think a lot of folks would say that that oversight mechanism isn’t what you would call best practice,” Mueller said. Only the Illinois General Assembly has the authority to change the oversight structure, she said. Mueller stopped short of making a call for lawmakers to do so, saying that’s not her role as an agency leader.“

Widespread Problems Oversight entities have identified numerous problems in facilities across the state. In a March report, Equip for Equality found widespread problems at Chicago’s youth lockup — the state’s largest — including that it had utilized “unjust and excessive use of physical restraints and seclusion, often as punishment, with a wanton disregard of state law.”

In a letter addressed to Equip for Equality, Leonard Dixon, superintendent of the Chicago facility, rebutted the findings, saying that the youth facility follows state and federal laws and that the advocacy group’s claims about unlawful restraints were “unsupported” and that physical restraints are “never used as punishment.”

Dixon noted to the news organizations in a statement that recent state audits found the facility to be in compliance with restraint standards.

Concerns about excessive use of force extended beyond Chicago.

In April, a youth at the Mary Davis Home in Galesburg, in central Illinois, told an IDJJ auditor of a troubling physical restraint from the day before. After watching a video of the incident, the inspector was so alarmed that he reported it to the state’s child abuse hotline, although ultimately the Department of Children and Family Services did not designate this as a case of abuse or neglect. No other governmental body is charged with reviewing whether administrative policies were properly followed in specific situations. The IDJJ audit noted that one of the staff members involved had not received the training the facility utilizes to teach staff proper restraint techniques.

Wendi Steck, superintendent of the Mary Davis Home, said the employee involved in the restraint incident no longer works there, but she declined to say whether his departure was related to this incident. “Any incidents of abuse of our clients are not tolerated and are dealt with swiftly,” she said.

“All staff are trained in Handle with Care restraint and cannot be involved in any restraints until successfully trained.”

Perhaps nowhere are concerns as extensive as those documented at the 32-bed youth lockup in Benton, the only one that IDJJ labeled “in crisis.” The facility is the state’s southernmost detention center and houses youth from across 26 counties — the lower quarter of the state.

Among IDJJ’s findings in its August 2022 audit: Youth were confined to their rooms for upwards of 24 hours for behavioral infractions, though state standards limit the use of seclusion to four hours and allow it only if youths are at risk of harming themselves or others. In fact, because the facility was so short-staffed that IDJJ described the issue as “critical and unsustainable,” youth were kept in their rooms for most of their days there, even if they had not acted out. The facility has a gym and outdoor recreation area, but youth had not utilized either area for two years. The facility had no process for assessing youth to determine if they were at risk of sexual assault or of sexually assaulting a peer, a requirement of the federal Prison Rape Elimination Act. Mental health services were “minimal” and “there was an obvious lack of training” among the staff.

Staff at the Benton facility told the IDJJ auditor that at one time, it had utilized the Crisis Prevention Institute to train staff on how to try to calm situations before they escalate and how to properly use physical restraints if it can’t be avoided. But a supervisor acknowl-

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A 2022 state audit identified the Franklin County Juvenile Detention Center in downstate Benton as a “facility in crisis.”

edged to the IDJJ inspector that such training had not been conducted in several years and that some newer employees may have never received it. “This poses a high risk for potential liability for the county,” IDJJ wrote in the audit.

Joseph A. Cervantez, the state’s attorney in Jackson County, one of the counties from which youth go to the Benton facility, said he was so alarmed when he read the report that he immediately stopped sending youth there. Without better services, he said, “I might as well just keep them out on the street.”

When IDJJ followed up in January, it found that many problems had not been corrected in the intervening five months. It also criticized the facility’s handling of the broken arm incident. Detention center staff told the auditor that its video system was faulty and didn’t record what happened. A senior official told the auditors that an internal review had been conducted but could produce no written record of it. While the standards do not stipulate the use of video cameras inside the facilities, any use of restraint or seclusion requires a full written report.

Bacon, the sheriff, said his office conducted an internal review consisting of a conversation between him and the chief deputy about what had transpired. “I was present and I was familiar with what was happening and the actions that we took, and there were no issues with those actions,” he said.

While IDJJ’s reports cited extensive problems, claims made by five youth who provided statements for evidence as part of the ACLU’s lawsuit, filed in July, suggested even more dire conditions. The youth said they were locked inside “very small concrete boxes” covered in black mold and that they were forced to eat their meals alone in their cells next to their toilets and sleep on wet mattresses because the windows leaked. One youth said he was experiencing a mental health crisis and cut his arm with a broken colored pencil.

“Instead of getting me any mental health treatment, they just gave me a paper towel to clean up the blood,” he said.

The presence of law enforcement officers inside the facility is common, several of them said.

“The crazy thing is the police don’t even just come in for fights or big things, they come in just when a kid doesn’t want to move and they do things that the staff should be doing,” said another youth.

Law enforcement records obtained by Capitol News Illinois showed that staff called on sheriff’s deputies 21 times between September 2021 and August 2023.

Some of the calls were for seemingly minor incidents. For instance, on Aug. 1, staff requested backup because a youth had “stuffed snacks down his pants and won’t give them back.”

In some cases, the arrival of deputies resulted in more aggressive restraint techniques than are typical for — or allowed in — juvenile detention centers. In October 2022, detention center staff called for backup because a different youth had refused to return to his cell. When the deputies tried to force him back to his room, the youth assumed a fighting position, the responding deputy wrote in a report, so the deputy fired his Taser.

Staff in juvenile lockups are not allowed to use stun guns on youth, according to IDJJ. Bacon said he believes the staff call on the sheriff’s deputies because of their ability to utilize tools, such as stun guns, that the facility staff cannot.

He said that he and his staff are trained in deescalation techniques and use force only when necessary. “There are youth that can cause harm to you,” Bacon said.

“And we want to use the least amount of force necessary, but at the same time we have to protect ourselves from being injured as well as the youth. That’s not our intention to hurt anyone.” He also said that as he understands the law, his office is not bound by IDJJ standards, even when officers are responding to an incident inside a facility that is under those rules.

In a statement, IDJJ said it does not consider calling for outside law enforcement alone to be a violation of any standards, though “the standards would apply to

how force, if any, is used.”

The agency said it had not been aware of the stun gun incident until they were alerted to it when they returned for an audit in late September. That audit is not complete and has not yet been made public.

Oversight Breakdown Two years ago, IDJJ updated its standards for the operation of juvenile detention centers, incorporating language that emphasizes youths’ education and mental health and stresses appropriate use of restraint and seclusion. Its reports, available online, became more robust. But while they have helped bring problems to light, said

Rachel Shapiro, a managing attorney with Equip for Equality, her agency is still identifying some “horrific” conditions that never appear in IDJJ audits.

And although it can document problems it has identified, IDJJ’s authority to ensure they are fixed is limited.

The law does allow the state agency to petition a court to order a facility into compliance if it hasn’t fixed deficiencies within six months of receiving notice from IDJJ. But IDJJ said the agency is “not aware of any instances’’ of agency staff initiating such a process, in part because it would have to petition the very courts that run them.

The Illinois Supreme Court is also limited in what it can do. Its standards say that the court “shall” withhold 10% of the salary reimbursements it provides to any facility that remains out of compliance 90 days after receiving notice, and another 10% monthly thereafter. But it has not financially sanctioned any facilities.

Instead, Bonjean said, a special unit within the Administrative Office of the Illinois Courts is closely monitoring any facilities that are still working through their corrective action plans.

The court spokesperson declined to provide the news organizations with the court’s full review of the Benton facility, its action plans or its progress reports. He confirmed that it remains out of compliance 14 months after the review but said that it is “making progress.” The county has approved funds for needed repairs and improvements to the facility, he said, but they will “take some time.” Reducing funding, he said, “could be problematic and could hinder the progress we

are trying to achieve.”

John Albright, IDJJ’s chief of performance and innovation, who conducts the audits for the agency, said he also tries to work closely with facility staff to help them understand the standards and how to meet them.

“Some facilities have been working very hard to make changes, and others maybe not as much,” he said.

When the oversight entities don’t compel action, the only option remaining for those who feel they were harmed by the system is a lawsuit, advocates say. Kevin Fee, an attorney with the ACLU of Illinois, said his organization is concerned about conditions across facilities. But those found in Benton were “far and away” the most troubling, he said.

“The Franklin County reports were pretty scathing, and we would have expected more action in response to those reports,” Fee said of the IDJJ audits. “But we didn’t see any, which is why we felt the need to bring the lawsuit.”

Jennifer Vollen-Katz, executive director of the John Howard Association of Illinois, an independent watchdog organization, agreed that even with the improved standards, there are still shortcomings with “system transparency and concerns about the treatment and conditions youth experience while in detention.”

The weak enforcement mechanisms are “a real deficiency in the state of Illinois,” she said. “We have work to do so that we’re not just inspecting these facilities and reporting on the issues. There has to be some way of holding the detention centers accountable and responsible for the treatment of youth in their custody short of litigation.”

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CRAIN’S CHICAGO’S CULTURAL LIFE

MICHAEL WARAKSA

S

SHRINKING AUDIENCES

FORCE A RECKONING Chicago cultural organizations struggle to bounce back in a changed world and economic climate I By Judith Crown

C

hicago arts and cultural organizations emerged from COVID-19 lockdowns, virtual performances and fully masked audiences to slow-to-return patrons, reduced ticket sales and scaled-backed productions. A decline in subscription rates, shockingly higher costs, and donations that haven’t kept pace with inflation have thrown some arts organizations off balance and spiraled others into crisis.

Museums, music and dance venues have bounced back faster. Theaters

struggled, perhaps, due to the expense and complexity of producing and staging plays.

During the summer, Lookingglass Theatre stunned the local arts world with its decision to pause programming until spring 2024, if not longer. Steppenwolf announced layoffs amid a drop in subscriptions and single-ticket sales.

Shuttered Victory Gardens Theater plans to transition to a foundation. The League of Chicago Theaters membership has fallen to 202 theaters from 250

before the pandemic.

“There’s tension in the way our patrons feel coming out of COVID,” says Lou Raizin, president of Broadway in Chicago.

“You couldn’t plan too far in advance.

Don’t talk to me about next fall.”

One widespread explanation: People are still holed up at home in their pandemic pajamas binge-watching “The Bear” and “Ted Lasso.” Or they’re amusing themselves with YouTube videos. On See RECKONING on Page 16

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NOVEMBER 27, 2023 | CRAIN’S CHICAGO BUSINESS | 15

CRAIN’S

CHICAGO’S CULTURAL LIFE

RECKONING the other hand, music fans will pay thousands to see a Taylor Swift extravaganza.

Even when audiences show up, they’re buying tickets at the last minute. That makes for a white-knuckled ride for theater planners. And with theater-goers forgoing subscriptions, there’s less money upfront as a cushion.

In the long run, that could make planners less inclined to take a risk on a controversial or innovative work.

“People want what they want when they want it,” says Roche Schulfer, the longtime Goodman Theatre executive director. “They will pay anything for what they want to see. And they don’t want to be forced to see something they won’t want to see.”

Most of the performing arts in Chicago are housed in nonprofit organizations that depend on the generosity of individual donors, corporations and foundations. Yet in the pandemic years following the murder of George Floyd, companies shifted dollars to social justice causes, arts executives say. Others have focused on the environment and sustainability. The money coming in isn’t keeping pace with inflation.

“Our philanthropy is just getting back to 2019 levels,” says David McDermott, executive director of Hubbard Street Dance Chicago. “The problem is that everything is 20% to 30% more expensive.” That applies not only for salaries, but costumes, plane tickets and catered events.

The retrenchment has taken a toll on theater workers, including actors, directors and crew members. During the pandemic, some left the field while others moved away. Most have other jobs to make ends meet.

“I’m still going, because as an actor and a director, there are two lanes I can work in,” says Manny Buckley, an ensemble member of American Blues Theater. When he’s not in rehearsal or performances, he delivers food for Uber Eats and DoorDash.

New avenues are being studied. One path lies in more collaboration between nonprofit and commercial theater, following the recent success of TimeLine Theatre’s production of the Tony Award-winning “Lehman Trilogy,” in partnership with Broadway in Chicago. And executives are exploring whether there could be more federal funding for the arts following the Small Business Administration’s Shuttered Venue Operators Grant, which provided emergency funding during the pandemic.

Managers say they are encouraged by stronger attendance this fall, although the challenges of fundraising and higher costs will take longer to resolve. “The performing arts will return and be more vibrant,” McDermott says.

GEOFFREY BLACK

From Page 15

Lori Dimun, CEO of the Harris Theater

COVID-19 pandemic’s toll Performing arts venues presenting plays, dance and music experienced a nearly 60% drop in average in-person attendance from 2019 to 2022. Total attendance saw a gain thanks to online programming.

Performing arts (143 organizations counted) Total in-person attendance

Total attendance: in-person and virtual

103,131

100,000 80,000 60,000 40,000

32,019

13,104

42,462

2019

2022

2019

20,000 0 2022

Source: SMU DataArts

“But this isn’t going to happen immediately. It will take a number of years.”

Buying last-minute tickets Budget cuts during the pandemic naturally resulted in fewer productions, exhibitions and other events. A recent study for the Chicago Department of Cultural Affairs & Special Events, or DCASE, by the arts research organization SMU DataArts found there were nearly two-thirds fewer programs in 2022 as compared to 2019.

Of course, 2022 was still a pandemic year with venues requiring masks and proof of vaccination. The federal government didn’t declare an end to the public health emergency until this past May. Arts executives interviewed say conditions have improved this year, but data collected on U.S. arts organizations by the research firm TRG Arts in Colorado Springs, Colo., show a mixed picture. Ticket sales started the year strong with gains over 2022 levels through the first

16 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

four months of the year, according to TRG Arts. But since May, ticket sales have only matched or lagged behind last year’s levels.

TRG Arts’ survey covers theater, dance and classical music.

Giving also has slightly lagged 2022 levels, TRG data shows. Arts executives hope the discouraging trends will galvanize support from funders and maybe even from the public sector.

Between 2019 and 2022, average in-person attendance at performing arts events plunged 59% to 13,104, with theaters being the hardest hit, according to the DCASE study. “We were the first to close and the last to reopen,” says PJ Powers, artistic director at TimeLine Theatre. “You can’t just flip on the lights and you’re back.”

In contrast, in-person attendance at museums, according to the DCASE study, fell only 14% to an average of 39,190. Visitors can come and go at their convenience, and it’s easy to keep a distance from others. The Museum of Science & Industry, or

MSI, has 1.3 million square feet of space for attendees to stretch out.

Attendance at MSI is back at pre-pandemic levels, says Chevy Humphrey, the museum’s CEO. Last year, attendance hovered at 77% of the levels before COVID. Membership hasn’t rebounded in the same way, but Humphrey expects that to rebound as the museum opens new exhibitions and programs, including an immersive exhibit on how the brain responds to music.

The DCASE study found that Chicago museums suffered a 29% loss in members, reflecting a national trend. Attendance at the 11 Museums In the Park fell 22% between 2019 and 2022, according to the consortium. Data for 2023 wasn’t available.

For performances, attendance has rebounded this year, but ticket buyers aren’t planning ahead. “Sometimes, it’s two hours before the performance,” says Lori Dimun, CEO of the Harris Theater, which presents music and dance programs. “It’s

all over the place and unpredictable.”

Before the pandemic, a chamber music program would draw 550 to 600 people, Dimun says.

Now, there’s more variability, a range of 375 to 700. “It depends on the familiarity of the work,” she says. Yet, advance tickets for Black Grace, a contemporary dance company from New Zealand, are selling well for their March performance. “It’s the first time they’ve been in Chicago, and there’s curiosity about it,” Dimun says. “We’re trying to figure out what sparks curiosity.”

Particularly troubling for performing arts organizations is the decline in subscriptions — down 26% between 2019 and 2022, according to the DCASE study.

Subscription revenue is money in the bank at the beginning of the season — revenue the theater can count on, notes the Goodman’s Schulfer. Without that cushion, a theater has to boost marketing to sell single tickets. In the long run, dependence on single-ticket sales is likely to make artistic directors more risk averse, he adds.

Theater and opera goer Thomas Oprzedek says he dropped his Goodman and Lyric Opera of Chicago subscriptions after the pandemic. “There aren’t enough shows I’m interested in seeing,” says Oprzedek, a Chicago professional hair stylist. “I still go to the Goodman and Lyric, but I pick and choose one or two shows each season.”

Taking the safer bet One theater that has maintained a loyal following is the Paramount Theatre in Aurora.

Paramount boasts of having the largest subscription base in the country at 37,000. That’s down from a pre-pandemic high of 41,000, but up from a COVID low of 26,000, says CEO Tim Rater.

“As long as we don’t overprice tickets, we’ll continued to increase our base,” he says. “That’s key because it’s incredibly hard to sell a show unless you have ‘Hamilton.’ ” Paramount licenses crowdpleasing musicals and stages its own productions. “Charlie and the Chocolate Factory” is running through the holidays. On tap for the spring are “Billy Elliot” and the Carole King musical, “Beautiful.”

Accessible prices make it easy to subscribe to the Aurora theater. It offers promotional packages, such as “buy two shows, get two shows free,” and the most expensive ticket for a subscriber is $39.50, Rater says. That can compare favorably to a suburbanite contemplating an outlay of hundreds of dollars for downtown Chicago tickets and parking.

Coming out of the pandemic, patrons could be looking for the lighter touch, or at least some serious plays that offer some hopefulness, managers say. If theater goers have a choice between See RECKONING on Page 18

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CHICAGO’S CULTURAL LIFE

CRAIN’S

Smaller theater companies got box-office boosts Pandemic lifelines gave arts organizations helmed by people of color a needed lift

By Judith Crown

The opening nights of the Destinos theater festival at Steppenwolf Theatre, which included a spoof of a popular Latino TV show, were virtual sellouts.

The annual festival, produced by the Chicago Latino Theater Alliance, or CLATA, showcases Latino artists and companies from Chicago, the U.S. and Latin America. Its recent triumphs suggest that theater showcasing people of color is on an upswing, says CLATA Executive Director Jorge Valdivia.

Although the COVID-19 pandemic was devastating for all arts organizations, non-majority-run organizations received a lifeline in the form of government funding.

Before COVID, these organizations had a difficult time attracting private funding, says Marissa Lynn Jones, executive director of the League of Chicago Theatres. When government funding became available during the health emergency, it was distributed in a more equitable process, she says. These

theater companies, many of which are small storefront operations, were able to add staff and produce more work. The question, Jones says, is whether these groups will be able to sustain their momentum.

More funding, more staff Arts organizations helmed by people of color enjoyed a nearly threefold increase in government support between 2019 and 2022, according to a recent study for the Chicago Department of Cultural Affairs & Special Events by the arts research organization SMU DataArts. Adjusted for inflation, the gain was 129%. Such groups also garnered more support from individuals, up 46%, adjusted for inflation.

That funding enabled the small theaters to add full-time staff and part-time employees.

Those organizations stood out in their commitment to hiring artists, increasing their artistic fold by more than 80%, the study found, although the groups started from a

“La Jom Atenda.” I REPERTORIO LATINO THEATRE COMPANY

relatively small base.

A number of theaters headed by people of color provided free seats to their communities or simply asked attendees to pay what they could afford, Jones says.

Providing access is key, says Carlos Tortolero, president and founder of the National Museum of Mexican Art in Pilsen, which produces performances and outdoor concerts. It doesn’t charge

for admission.

“People ask me, ‘How can you be free?’ ” says Tortolero, who plans to retire at the end of the year. “We believe in being free.

You have to budget to make sure you can be free.”

Returning attendance Attendance this year has returned to pre-pandemic levels, he says. Last year, his museum

hosted 120,359 visitors, close to the 2019 levels of 133,113, according to Museums in the Park, which reports data on the city’s 11 largest museums. In 2021, the National Museum of Mexican Art received an $8 million donation from billionaire philanthropist Mackenzie Scott, its largest gift.

The museum also has received funding from the Ford Foundation, the MacArthur Foundation and the Chicago Park District.

While the museum has been successful in fundraising, Tortolero notes that it’s a struggle for small Latino arts groups. Corporations habitually fund large, well-known institutions, even as the Hispanic population becomes ascendent in large cities and public school systems.

Larger organizations can learn from small theaters founded by people of color, executives say.

They pay attention to their audience, says Roche Schulfer, executive director of the Goodman Theatre, which presented one of the Destinos plays, “Lucha Teotl,” in partnership with CLATA. “They’re connected with their audience in a way that some companies are not.”

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CRAIN’S

CHICAGO’S CULTURAL LIFE

RECKONING seeing a new work or something that’s commercially proven, they are taking the safer bet, DCASE Commissioner Erin Harkey said during a recent webinar.

Theater Wit is shifting to plays that promise joy and healing, says Producing Artistic Director Jeremy Wechsler. “What kind of redemption is possible?” On the other hand, he notes, Arthur Miller’s dark play, “A View From the Bridge,” did very well at Theater Wit. “That it’s a tragedy didn’t affect sales,” he says.

One longtime theater goer who hasn’t lost her enthusiasm is Chicago attorney Virginia Kim, who has kept her subscriptions at Steppenwolf, Court Theatre and Theater Wit. “If it’s not on my calendar, I forget to buy tickets,” she says. Lately, she’s seen fuller theaters, although she notes it doesn’t take many people to fill a small venue. If the reviews are good and people are recommending a play by word of mouth, the seats are mostly full, she adds.

Even as attendance improves, fundraising weighs on arts managers. Donations may be closer to pre-pandemic levels, but they aren’t keeping pace with higher costs. Whether it’s $100 or $10,000, donors get used to writing checks for the same amount, but the value of the contribution is greatly diminished, managers say.

One thousand dollars is an incredible gift, but it’s a different gift from what it was five or 10 years ago, says Dimun of Harris Theater. “One of our board members said he was including an inflationary bonus in his gift, which was manna from heaven,” she adds.

Indeed, trustees in the arts stepped up dramatically during the pandemic. Average support nearly tripled in 2021 to $251,789, according to the DCASE study.

Adjusted for inflation, trustees boosted giving by 12% over the past four years. But individual and foundation support, adjusted for inflation, fell 15% and 21%, respectively.

Schulfer of the Goodman Theatre says he’s seen institutions curb funding of the arts and divert dollars to other causes. “There’s an undercurrent feeling that the arts aren’t essential,” he says.

Managers acknowledge the need to put more manpower behind fundraising but are just climbing back to pre-pandemic staffing levels. Small and midsize theaters have few full- and parttime staff members and depend on freelance actors, directors and technicians.

Those independent contributors are used to the uncertainty of the theater business but have to be nimbler to make ends meet.

Even Buckley, with a long list of acting and directing credits — recently in American Blues Theater’s “Fences” and in its annual production of “It’s a Wonderful

GEOFFREY BLACK

From Page 16

Manny Buckley, an ensemble member of American Blues Theater

Museums recovering On-site attendance at the 11 Museums in the Park, including the four largest, rebounded in 2022 but has yet to return to pre-pandemic levels.

2,000,000 1,500,000 1,000,000 500,000 0 2,000,000 1,500,000 1,000,000 500,000 0

Shedd Aquarium

1,773,185

Museum of Science & Industry

1,133,567

Art Institute of Chicago

1,062,689

Field Museum

1,017,875

2022

2018

2018

2019

2020

2021

2019

2020

2021

2022

Total combined on-site attendance at the 11 Museums in the Park 6,102,238 8,000,000 6,000,000 4,000,000 2,000,000 0 2018

2019

2020

2021

2022

Source: Museums in the Park

Life: Live in Chicago!”— has a list of backup gigs. Besides delivering restaurant orders, he auditions for voiceovers and has trained lawyers by playing the role of witnesses in mock depositions. “While I want to believe that the beating heart of theater is still there, it looks like a lot of people are struggling,” he says.

The uncertainty of funding puts theaters in a vulnerable position, especially small and midsize organizations without an endowment or financial cushion. “For non-

18 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

profit theaters, there’s a fine line between success and failure,” says Raizin of Broadway in Chicago.

“They walk right to the edge all the time.”

It’s just one audience One potentially lucrative route for nonprofit theaters is to team with the commercial sector — especially for proven hits. TimeLine Theatre reaped a bonus by teaming with Broadway in Chicago for its fall production of “Lehman Trilogy,” the story of

the family behind the Lehman Brothers investment bank that collapsed in the 2008 recession.

Under the arrangement, TimeLine rented the Broadway Playhouse at Water Tower Place from Broadway in Chicago and paid fees for staff and marketing support. “At the Broadway Playhouse, it’s an exponentially larger audience,” says TimeLine Artistic Director Powers. “Lehman will play to 35,000 people during its extended run. At our home on Wellington (Avenue), it

would take us a year and half to reach that number.” The Wellington Avenue theater seats 99 compared to 549 at the Broadway Playhouse.

Nonprofit theaters also benefit from pre-Broadway runs, such as the summer production of “Tommy” that was a hit at the Goodman Theatre. The revival of the classic rock opera is slated to open at New York’s Nederlander Theater in March. Unfortunately, the Goodman was unable to reap benefits by extending the run.

“We would have to pay people considerably more for their time and the (profit) margin would be smaller,” Schulfer says. “We’re not in business to do one show and run it forever. We’re in business to do a season of plays and do new work, a wide variety of work for a wide range of audiences.”

Schulfer says he hopes that the success of the Shuttered Venue Operators Grant program prompts discussions about future funding levels for the arts.

“It would be great to see advocacy happen on a national level between commercial and nonprofits theater worlds,” he says.

“How that would manifest itself remains to be seen. Right now, (it’s) just informal conversations among people in the business.”

There’s a misconception that government support is significant in theater operations and it’s not, he adds. Government support (outside of pandemic aid from the SBA program) is less than 1% of the Goodman’s budget. “If it were 10% of our budget — or about $2 million of a $24 million budget — that would have a huge impact,” he says.

Arts groups, including Arts Alliance Illinois, had lobbied for DCASE to receive more dollars from the city’s corporate fund. Although that was turned down, the department is slated to receive a greater share of hotel occupancy tax revenue, says DCASE spokeswoman Madeline Long. The department will prioritize direct support to artists and general operating grants to nonprofit arts organizations, she says, and will work across government and with philanthropic organizations to provide additional support.

Managers acknowledge that they also must look inward to make sure they are producing shows that will sell and getting the word out to established and new audiences. Raizin of Broadway in Chicago says many of the nonprofit theaters have a proprietary sense of what they are and who the patrons are. “The reality is they are all the same patrons,” he says. “If we all think about a collective audience, we all come out better for that.”

Performing arts organizations sail in the same ocean, just in different boats, says Dimun of Harris Theater. They can learn from one another as they adjust to a new era. In the end, she says, “if we keep putting out exceptional work, people are going to come back.”

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CRAIN’S

Increased public safety could draw more local tourists to Chicago attractions

By William Johnson

“Our tourism industry is back, and it’s booming,” Gov. J.B. Pritzker declared over the summer.

His optimistic analysis does not reflect Chicagoans’ perception of local tourism: Seven in 10 Cook County residents believe that Chicago’s tourism industry is still recovering from the COVID-19 pandemic, according to a recent Harris Poll survey.

COVID effectively shuttered Chicago for more than a year.

With local attractions closed, and quarantine requirements hindering out-of-state travelers, the tourist flow slowed to a trickle. And tourism has largely remained below pre-pandemic levels even after the city lifted its mitigation measures.

A booming summer travel season raised hopes that Chicago’s tourism and entertainment industries are back on track for a full recovery. Chicago hotel revenue hit a record-breaking $1.12 billion in the first half of the year, up 109% from 2019. Data from Chicago’s tourism department, Choose Chicago, also showed that international travel to Chicago was up 13% from 2022.

The lineup of popular cultural attractions downtown this summer, including Lollapalooza, NASCAR, Ed Sheeran and Taylor Swift, undoubtedly bolstered the travel spike. The weekend that Swift performed at Soldier Field, Chicago set a record for weekend hotel occupancy — with an average rate of 96.8%.

The summer’s strong hospital-

William Johnson is CEO of The Harris Poll, a global public opinion polling, market research and strategy firm. ity numbers are a significant win for the Windy City, but Chicago’s COVID tourism slump is not entirely behind us. The city lagged many others in lifting COVID-era restrictions. During this period of strict COVID policies, many event organizers booked their future conferences and events outside Chicago, in states that were fully open. These decisions will limit the number of visitors who will spend money at Chicago hotels, restaurants and other entertainment options at least through the mid-to-late 2020s.

Wariness of crime Beyond its COVID policies, Chicago’s crime crisis has also challenged the city’s ability to attract tourists. Even residents are wary of the city’s ongoing crime surge. Barely half (53%) of Cook County residents feel safe spending time in downtown Chicago.

If locals feel unsafe in their own city, how can we expect out-oftown visitors to feel comfortable?

If Chicago wants to attract more visitors downtown, city officials must effectively increase their feeling of security. Seven in 10 Cook County residents agree

that the city should invest in public safety initiatives to boost tourism.

Thankfully, local leaders are taking safety concerns seriously.

In June 2022, city officials launched the Corridor Ambassador program, which hired more than 100 area ambassadors to serve 12 of Chicago’s retail districts. All participating retail corridors are in low-to-middle income areas, and each has suffered a 15%-plus drop in activity since COVID’s start. Ambassadors greet visitors, share information on local events with them and encourage them to patronize local businesses. City officials hope that the program will increase tourists’ sense of safety, which would, in turn, spur their spending in these areas.

Beyond attracting more outof-state and international visitors, the city has another overlooked yet worthwhile opportunity: local tourism. Most Cook County residents (71%) say that they enjoy spending time downtown, but only a quarter strongly agree that they take advantage of Chicago’s entertainment options (e.g., events, attractions). This leaves ample opportunity for the city to promote entertainment options locally, and to increase engagement with suburban residents.

A slim majority (52%) of Cook County residents think the city should invest in special promotions for local residents, and 4 in 10 say that investing in entertainment options for area residents would have a similar salu-

Harris Poll: Safety and enjoyment Agree

Disagree

I feel safe spending time in downtown Chicago.

I enjoy spending time in downtown Chicago.

29% 53%

47% 71%

Harris Poll: Recommended tourism investments Which of the following areas do you think the city of Chicago should invest in to improve its tourism industry?

Specials (e.g., discounts, exclusive tickets) for area residents

52% Entertainment options for area residents

42% 0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

Source: Harris Poll • Cook County residents

tary impact. Residents are open to engaging with the city’s attractions, but they may require increased incentives to take that next step.

Prioritize safety While COVID closures feel like a lifetime ago, their lingering effects on Chicago tourism and entertainment will remain visible in the near term. Time may be

the city’s greatest healer, but local leadership should prioritize safety initiatives to attract more visitors downtown before too much of it passes. Increasing residents’ perception of safety may be the quickest way to effectively boost city and suburban residents’ participation in the local cultural scene, and make it more attractive to out-oftowners.

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CRAIN’S

CHICAGO’S CULTURAL LIFE I COMMENTARY

W t

A ripe moment to uplift and embrace theater in subscription sales from customers uncertain about committing to a schedule.”

Those historic parallels demonstrated that past periods of recovery were impelled by a couple key factors: Producers embraced our responsibility to meet those moments not only with resonant art but also with humility and awareness of shifting audience propensities. In turn, ardent Chicagoans who valued the importance, and continuance, of theater in our city responded with support.

I see that passion within our community today. And I attest that it’s prevalent among producers striving to both respond to, and lead through, this moment.

I’m filled with hope by the fact that countless audience members have lamented to me that what’s absent among the many columns opining about the industry’s problems is any constructive call to action.

They want to make a difference. Theater lovers and civic and business leaders alike, all who value a theater scene that is secondto-none and who recognize the ways it adds to the city’s quality of life, understand the need to act.

Christiansen documented that the reason our community rose “from up-and-coming

ALYCE HENSON

I

n his 2004 book, “A Theater of Our Own,” the late theater critic Richard Christiansen chronicled more than a century’s worth of our city’s players, organizations, and societal circumstances that built what Mayor Richard M. Daley called “The New Theater Capital of the United States.”

I revisited this book recently, longing for historical context and more nuanced analysis of the theater industry’s current moment — still facing disrupted financial models and altered audience habits after emerging from an 18-month (or more) period of dark stages due to COVID. Sobering (but not shocking) data about declines in attendance, subscriptions and contributed income — detailed in a recent report from Chicago’s Department of Cultural Affairs and Special Events (DCASE) — led me back to Christiansen’s reporting, and his astute perspective on our city and industry.

He revealed that “In late 1929, the lights of Chicago theaters, of all persuasions, began to waver and go out. The Great Depression and the advent of the movie talkies were devastating to their work.”

And, seven decades later: “The widespread trauma caused by the 9/11 terrorist attacks of 2001 was given as a possible reason for a lag

Ch

PJ Powers, co-founder and artistic director of TimeLine Theatre, suggests simple ways to support Chicago theater.

status to an almost mythical reputation as a center of creativity” was due to a grassroots movement that solidified Chicago as “an important theater center for more than a century.”

Today’s challenges call for a similar movement to ensure a resurgence and ongoing vibrancy.

Chicago theater entertains, provokes and enlightens. It educates and inspires youth.

Fuels economic vitality. Encourages civic engagement. And expands society’s ability to understand other perspectives and show compassion — for stories about those we may know, and stories about those we don’t yet know enough.

As history has shown, theaters can only do so in partnership with our community.

Particularly in this holiday season, there are simple ways we can all make an impact,

whether it’s philanthropic generosity or creative gift-giving. Treat your family, friends and colleagues to more than just another gift card. Blow their minds with tickets to a show. Or even better, a flexpass subscription to their neighborhood theater to sample a variety of productions throughout the year. Then, join them.

Inquire at work about matching programs for charitable donations, or possibilities to leverage your talents by serving on a theater’s board of directors.

Attend a performance venue you’ve never been to. Or make a point to revisit a beloved organization.

Together, let’s remind ourselves — live, and in person — what a treasure we have in this city by embracing, uplifting and helping to expand the rich history of one of Chicago’s greatest attributes: A Theater of Our Own.

Hav to S Ale cou peo com spa mo dur

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20 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

TODD ROSENBERG

I

Deeply Rooted Dance Theater performs in “Madonna Anno Domini,” choreographed by Nicole Clarke-Springer, in November 2022.

ed Dance Theater has begun to work with the Mellon Foundation as they lead the charge to change the philanthropic sector and its relationship to its grantees.

The commitment on behalf of funders to enhance their understanding of financial, programmatic, and institutional opportunities and challenges for organizations like ours is key to our relevance and ability to thrive in this dance community. Participating in a program such as COHI, which allowed us as artists to guide conversations that unlocked space for true innovative visioning, expansion and course correction within programming, has been instrumental to our growth. Acknowledging the ways Deeply Rooted’s work changes over time,

due to its connection to its community, funding support, programming, and other factors, amplifies the necessity for our business model to continue to shift, change and grow just as our artistic work does.

Chicago has a broad range of arts organizations committed to their respective missions.

It is imperative that we each prioritize authentic expression over conforming to traditional expectations that we hope will keep us relevant to funders. At Deeply Rooted, we are committed to our mission to reimagine and diversify the aesthetics of contemporary dance, demonstrating the transformative power of art and beauty through dance education, performance, and cultural enrichment in Chicago and on the world stage.

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Prioritize authentic expression over traditional artistry

ing. The myriad COVID relief n a city where Black dance comprograms that came flooding panies comprise about a third of through our company boosted the Chicago dance community, what funders otherwise viewed as a Deeply Rooted Dance Theater is struggling budget. This immediate in constant pursuit of growth, visibilinfusion of funds allowed us to apity and sustainability, while working pear healthier than we were. Fortuto stay relevant within the field. nately, we were provided new opIn 2019, more than 56% of fundportunities to address our specific ing was awarded to three majority- Nicole operational needs as a missionwhite dance institutions, according Clarke-Springer driven organization pursuing our to the Chicago Department of Cul- is artistic artistic purpose in a steady, sincere tural Affairs and Special Events. director of and eager way.

These funding practices only exac- Deeply Rooted One significant opportunity erbated the critical issues faced by Dance Theater. came from the International AssoBlack arts organizations. While the remaining 44% was spread among other di- ciation of Blacks In Dance COHI (Compreverse companies, Black companies repeat- hensive Organizational Health Initiative) edly found themselves struggling to remain MOVE program. Designed to strengthen the in existence, let alone relevant. The narra- organizational health of small and midsize tive for organizational financial support arts institutions through comprehensive fiseemed to be entirely created by the fund- nancial analysis and capacity-building financial support, funded by the Andrew W. ing sector, not the artists themselves.

Transitioning into the role of artistic di- Mellon Foundation, the program recently rector of Deeply Rooted Dance Theater at distributed MOVE (Managing Organizathe start of the pandemic allowed me to ex- tional Vitality and Endurance) grants to 30 perience the particularly noteworthy shift member organizations across the U.S. As a from pre-pandemic to post-pandemic fund- long-standing IABD member, Deeply Root-

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CHICAGO’S CULTURAL LIFE

With paid attendance bouncing back, the CSO has reason to toot its horns ALYCE HENSON

Chicago’s renowned orchestra draws on its financial strengths and loyal fans to get through tough times I By Judith Crown

ater.

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ive, e in ping go’s .

izaons. henonal eleare and rary tive dument

CRAIN’S: What is the financial state of the Chicago Symphony Orchestra?

Have CSO fans returned to Symphony Center?

Alexander: We’re happy. We could be happier. A number of people have been reluctant to come to an enclosed theater space. Some subscribers moved to a second home during the pandemic and

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nity, her usiand

The pandemic was daunting for all performing arts organizations, but the Chicago Symphony Orchestra has bounced back better than most. It helps to be one of the premier orchestras in the world. With $22.1 million in ticket sales for the 2023 fiscal year that ended June 30, the organization is close to pre-pandemic levels. Paid attendance of 270,000 was up 29% from 2022, but is slightly below 2019. As is the case with other arts organizations, annual fundraising is not all the way back, while inflation has boosted expenses. In a recent interview, Jeff Alexander, president of the Chicago Symphony Orchestra Association, and Chief Financial Officer Stacie Frank discussed the post-pandemic landscape.

Jeff Alexander: We’re building our way back. We have the same revenue as five years ago, but expenses have gone up every year. So, that’s the budget challenge.

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CRAIN’S

didn’t come back, so they’re no longer subscribers. Crime downtown is also a factor. That discouraged some people from moving back to Chicago. And it keeps others who live here from making their way to 220 S. Michigan Ave. How did you stay afloat during the COVID-19 pandemic?

Stacie Frank: Donor support helped us through. We leaned on our endowment more heavily.

And we benefited from $10 million through the Small Business Administration’s Shuttered Venue Operators Grant program.

Did you keep staff?

Alexander: We reduced compensation in a range of 5% to 25%. We’re glad we did it that way. When things started opening up again and we had to produce concerts, it would have been hard to hire new people.

The orchestra members took a 40% pay reduction. By January 2022, we were back at 100% pay.

How did annual fundraising hold up?

Alexander: We raised about $22 million in fiscal year 2023. We were up to $25 million before the pandemic. There was 30% attrition among smaller donors.

Our higher-level donors are

the case anymore. It might be 90% white, but that’s better than 100%.

steady. Corporate is getting harder. More are feeling obliged to put philanthropic dollars toward ecology, social services and equity.

What about the musicians?

Alexander: With musicians, there’s a stringent audition process. They play behind a screen to avoid possible discrimination. The challenge is: Are there enough qualified candidates from those communities auditioning? Five years ago, we co-founded a program for Black, Latinx and Indigenous high school students who plan to become professional musicians. They get weekly lessons from a member of the CSO or Lyric Opera Orchestra.

They get coaching sessions and are taught how to take auditions. Every senior that’s gone through the program has been successful in getting into a high-level music school. For any ethnicity, it’s hard to win an audition. But at least there will be a much larger pool of candidates from these communities taking auditions.

After fundraising, ticket sales and other revenue from programs, there’s still a gap?

Frank: We draw 5% from the endowment annually. For 2023, that was $18 million.

It’s calculated on a three-year average and we know that we will take that every year. We also draw from other investments.

The CSO is known for having an older, affluent and white audience. Is that changing?

Alexander: We created affinity groups: the Chicago Symphony Orchestra Latino Alliance and the Chicago Symphony Orchestra African American Network.

We have receptions and other social events that link them to the organization. When I started nine years ago and I looked around the audience, it was almost 100% white. That’s not

STATE OF THE ARTS IN CHICAGO I How Chicago theaters and museums stack up

TODD ROSENBERG

By

1. Which of the 11 Museums in the Park had the largest in-person attendance in 2022?

2. What Chicago-area theater boasts the largest subscription base in the nation?

3. How many theaters are members of the League of Chicago Theatres?

A. Art Institute of Chicago

A. Paramount Theatre (Aurora)

A. 324

4. Which museum in Chicago received an $8 million gift from philanthropist MacKenzie Scott?

B. 162

A. Adler Planetarium

C. 291

B. National Museum of Mexican Art

B. Museum of Science & Industry C. Shedd Aquarium D. Field Museum

B. Marriott Theatre (Lincolnshire) C. Northlight Theatre (Skokie)

D. 202

Answer: A

A. Cadillac Palace Theatre B. Broadway Playhouse C. The Chicago Theatre D. CIBC Theatre

C. Chicago History Museum D. National Museum of

D. Drury Lane Theatre (Oakbrook Terrace) Answer: C

5. Which of the following theaters is not part of Broadway in Chicago?

Puerto Rican Arts & Culture Answer: D

Answer: B

Answer: C — Compiled by Judith Crown NOVEMBER 27, 2023 | CRAIN’S CHICAGO BUSINESS | 21

52 worthwhile charity options to consider in this season of need

G

iving Tuesday is a global day of generosity transforming communities and the world. With so much attention given to what divides us, generosity brings people together. Generosity can be as simple as helping a neighbor or advocating for a cause. It is also a great time to get involved with a local charitable organization.

Crain’s Content Studio is proud to showcase the nonprofit organizations serving communities in Chicago you see here. Please consider supporting them with your money, time or other resources on this Giving Tuesday and beyond.

P0XX_P0XX_CCB_20231127.indd 22

Changing how Chicago fights poverty by investing in bold ideas that create opportunities for youth.

Providing high-quality after-school and summer program opportunities for Chicago teens to explore their passions and develop their talents.

abetterchicago.org

afterschoolmatters.org

Uniting the ALS community to foster bold research initiatives, advance advocacy efforts and provide comprehensive support to those affected by ALS.

Building a healthy and happy community where pets and people thrive together.

alsunitedchicago.org

anticruelty.org

11/16/23 3:40 PM

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Increasing the collective impact of our 50+ member organizations to improve education and economic development outcomes for Chicago’s Austin area.

Empowering Chicagoland children to explore new ideas, gain knowledge and strengthen reading skills with free, quality books.

For 45 years we have provided healthy food, critical resources and services to hungry families on Chicago’s West Side and nearest suburbs.

austincomingtogether.org

berniesbookbank.org

gobeyondhunger.org

Training and equipping communities with research tools to be more civically engaged and policy-informed.

Rooted in our history of serving Latinos, we provide high-quality services, in diverse communities, that empower individuals and families to thrive.

Accompanying anyone in need, regardless of their background. We provide vital support to individuals and families across the region.

Linktr.ee/blkresearchers

casacentral.org

catholiccharities.net

Improving children’s lives by creating a community where play and learning connect.

Empowering individuals, families and communities to overcome poverty and systemic barriers, embrace opportunities and thrive across generations.

We’re working to build a Chicago region where equity is central—and opportunity and prosperity are in reach for all. Join us.

chicagochildrensmuseum.org

chicagocommons.org

cct.org

Cornerstone S E R V I C E S

Transforming how talent meets opportunity by taking Chicago’s brightest young people from classroom to career and beyond.

Progressive, comprehensive services for people with disabilities, promoting choice, dignity and the opportunity to live and work in the community.

Providing children, ages 0-12, living in homeless or low-income situations with essential items needed to thrive, free of charge.

chicagoscholars.org

cornerstoneservices.org

cradlestocrayons.org/chicago

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11/16/23 3:40 PM

GIVING TUESDAY 2023

35 years of unlocking educational opportunities for talented Chicago-area students facing financial need.

As a part of the University of Illinois System, we empower diverse tech talent in Chicago, innovate with R&D, and turn discoveries into businesses.

The nation’s first independent museum dedicated to the collection, preservation and study of the history and culture of African Americans and people of African descent.

dmsf.org

dpi.uillinois.edu

dusablemuseum.org

The preservation, presentation, promotion and education of all forms of dance and music traditions of Spain.

The premier consultancy that engages highly skilled professionals to provide nonprofits with the consulting services they need to be successful.

Protecting and defending the First Amendment by supporting the right of libraries to collect and individuals to access information.

ensembleespanol.org

execservicecorps.org

ftrf.org

Providing pathways to career success for CPS high school students through skills training, work experiences and impactful relationships.

genesysworks.org/chicago

Our mission is to end hunger.

Aiding people with substance use disorders in their recovery by providing comprehensive behavioral health solutions.

chicagosfoodbank.org

haymarketcenter.org

We are a courageous human rights and social justice organization that positively impacts those who face barriers to a safe, stable and secure future.

Helping children thrive and families flourish through innovative, community-based programs.

To provide help, healing and caring services infused with Jewish values to strengthen lives in our community.

heartlandalliance.org

hephzibahhome.org

jcfs.org

P0XX_P0XX_CCB_20231127.indd 24

11/16/23 3:40 PM

SPONSORED CONTENT

The leading global organization funding type 1 diabetes (T1D) research to cure, prevent and treat T1D and its complications.

Providing points of community and connection, delivering human services and responding to humanitarian crises in Chicago, in Israel and worldwide.

Using the power of the law to secure dignity, opportunity and well-being for people facing barriers due to illness or disability.

jdrf.org/illinois

juf.org

legalcouncil.org

Working with the community so seniors and people with disabilities have nutritious meals and wellness programs that improve their quality of life.

A solution for kids and families in crisis, providing a safe home, healing, education, life skills and opportunities to build resilience and success.

Transforming the lives of Chicago-area youth through removing barriers to high-quality music education.

mealsonwheelschicago.org

mercyhome.org

meritmusic.org

Supporting more than 600 children and adults with intellectual and developmental disabilities by providing the full continuum of care.

Encouraging the planting and conservation of trees and other plants for a greener, healthier and more beautiful world.

Creating opportunities for people to live in affordable homes, improve their lives and strengthen their neighborhoods.

misericordia.com

mortonarb.org

nhschicago.org

Providing our northern Illinois neighbors with the food they need to thrive while serving them with dignity, equity and convenience.

Formerly Lakeview Pantry, we provide food, mental-wellness counseling and other social services to our Chicago neighbors in need.

solvehungertoday.org

nourishinghopechi.org

M I S E RICO RDIA HEART OF MERCY

P0XX_P0XX_CCB_20231127.indd 25

We empower people with developmental disabilities to work, live and enjoy their lives within their chosen communities.

orchardvillage.org

11/16/23 3:40 PM

GIVING TUESDAY 2023

SPONSORED CONTENT

No Kill animal shelter providing medical care to more than 25,000 homeless and at-risk pets each year.

We exist so families can get better together.

Providing outstanding patient care, empowering tomorrow’s healthcare leaders, advancing research and supporting community partnerships.

pawschicago.org

ronaldhousechicago.org

rush.edu

Improving the quality of life for individuals with intellectual disabilities through educational, residential and vocational programs.

Providing sports training and athletic competition in a variety of Olympic-type sports for children and adults with intellectual disabilities.

Supporting programs and partners that propel the CHA’s youngest residents on their pathways to academic success, economic stability and independence.

shoreservices.org

soill.org

s2schi.org

Improving the well-being of the communities we serve by providing accessible, high-quality healthcare.

tap360health.org

Meeting human needs without discrimination by providing shelter, meals and other services to those who need it most.

salarmychicago.org

Providing innovative behavioral and primary health care to thousands of people with mental health and substance use conditions each year.

thresholds.org

WBDC I G N I T E S B U S I N E SS G R OW T H

Ensuring our neighbors have access to the resources needed to thrive.

United, we’re building a stronger, more equitable Chicago region.

Supporting individuals and families who need it most, when they need it most.

Igniting business development and growth for diverse business owners to strengthen their participation in and impact on the economy.

liveunitedchicago.org

voaillinois.org

wbdc.org

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11/16/23 3:40 PM

CRAIN’S DINING AND ENTERTAINMENT GUIDE From private dining to specialty steakhouses, here are options for your next business meal.

BANDOL

100 W. Monroe St., Chicago, IL 60603 312-877-5713 • bandolrestaurant.com Brasserie & Raw Bar. A Southern French coastal inspired urban oasis, Bandol’s menu intertwines French and Mediterranean classics with modern seafood, raw bar and a sophisticated-casual touch. Using the freshest ingredients and local seafood, Bandol creates delicious steak tartare, prime rib sandwiches, burgers, salads, and more! Our raw bar features the best selections with oysters, salmon, and financial district’s best shrimp cocktails.

THE M ROOM

450 N. Clark St., Chicago, IL 60654 312-224-1650 • mroomchicago.com The perfect harmony of dish and dram. Located in Chicago’s River North, The M Room presents a chef tasting menu with an emphasis on Contemporary American Cuisine. Experience the finest culinary creations with seasonal ingredients and tasting notes of the whisky making process.

BERNARD’S

MONARCH & LION

BLVD STEAKHOUSE

REMINGTON’S AMERICAN GRILL

11 E. Walton St., 2nd Floor, Chicago IL 60611 312-646-1402 • bernardschicago.com Experience an unforgettable evening at Bernard’s Cocktail Lounge, where sophistication and exquisite mixology converge. Nestled in the heart of the Gold Coast, Bernard’s beckons with its warm ambiance, exceptional service and a delectable cocktail menu.

Elegance and charm surround you, whether unwinding with friends, impressing clients or enchanting a date.

Join us at Bernard’s to relish every sip of the good life.

817 W. Lake St., Chicago, IL 60607 312-526-3116 • blvdchicago.com Located in the Fulton Market District, BLVD Steakhouse is a classic American steakhouse inspired

by Hollywood’s Sunset Blvd. Helmed by Celebrity Chef/Partner Joe Flamm, the restaurant embodies the glamour and luxury that defined Old Hollywood offering sophisticated yet approachable service along with prime cuts and fresh seafood, innovative twists on 1950s cocktails, and an award-winning list of wines.

FORMENTO’S

925 W. Randolph St., Chicago, IL 60607 312-690-7295 • formentos.com Located in Fulton Market District within Chicago’s bustling West Loop, Formento’s is an Italian restaurant that features the bright and light flavors of Italy.

Created as a nod to the owner’s grandmother, “Nonna Formento,” guests will experience an array of dishes steeped from traditional family recipes alongside newage dishes. The world-class wine menu offers guests more than 600 varietals from around the world. At Formento’s, new world culinary creativity marries with generations past.

ITALIAN VILLAGE RESTAURANTS 71 W. Monroe, Chicago, IL 60603 312-332-7005 • Italianvillage-chicago.com

The Village is truly a journey back in time. Dine in the center of the charming piazza of an old Tuscan village, surrounded by beautiful landscape murals, twinkling lights, and the blue night sky. This unique, old-school Chicago dining room offers a non-private experience for up to 36 guests. We also offer private rooms for up to 150 guests.

P027_CCB_20231127.indd 27

302 E. Illinois St., Chicago, IL 60611 312-973-2623 • monarchandlion.com Monarch & Lion is an elevated British Pub. Taste our traditional Fish and Chips, Chicken Tikka Masala and savory pies. Watch American and European sports while sipping from eight rotating beers on draft and a large selection featuring UK and local brews. Stunning craft cocktails include a turmeric-infused Gin and tonic, a Pimm’s Cup, and Honey Mustard Old Fashioned.

20 N. Michigan Ave., Chicago, IL 60602 312-782-6000 • remingtonschicago.com Located across the street from downtown Chicago’s cherished Millennium Park is Remington’s – a classic American grill and steakhouse serving up warm hospitality, unparalleled service, and satisfying cuisine.

Remington’s menu features classic American fare and Chicago Steakhouse classics. The luxurious and rich interiors create an appealing ambiance for travelers and locals alike with the perfect setting for social gatherings and private parties.

ROSEBUD RANDOLPH

130 E. Randolph St., Chicago, IL 60601 312-473-1111 • rosebudrestaurants.com Rosebud Randolph, located steps away from Millennium Park, features three levels of stunning dining spaces, making it the perfect spot for any occasion. The menu highlights century-old, Italian, family recipes including hand-made pastas, meatballs, steaks, seafood and more. Rosebud Restaurants have been serving Chicago and the surrounding suburbs since 1976.

ROSE MARY

932 W. Market, Chicago, IL 60607 872-260-3921 • rosemarychicago.com Located in the Fulton Market District, Rose Mary is inspired by Celebrity Chef/Partner Joe Flamm’s Italian heritage and the bold, bright flavors of Croatian cuisine.

The award-winning restaurant offers a seasonal menu featuring house-made pasta and risottos, fresh seafood, and grilled meats, along with craft cocktails and a diverse list of Eastern European wines.

11/17/23 1:24 PM

CLASSIFIEDS

Advertising Section

.

To place your listing, contact Suzanne Janik at (313) 446-0455 or email sjanik@crain.com www.chicagobusiness.com/classifieds REAL ESTATE

Rush hospital system picks new executive VP and COO He will oversee operations of the hospital system, including Rush University Medical Center, Rush Oak Park Hospital and Rush Copley Medical Center

By Jon Asplund

CAREER OPPORTUNITY

CAREER OPPORTUNITY

CAREER OPPORTUNITY

CAREER OPPORTUNITY

Rush University System for Health has tapped the chief operating officer at a large Pennsylvania health system to be its executive vice president and COO. The Chicago-based health system said Matt Walsh of Geisinger Health in Danville, Pa., will assume the same role at Rush in January 2024. He was selected following a nationwide search, the system said in a written statement.

“Matt will be an incredible addition to our already strong leadership team,” Dr. Omar Lateef, president and CEO of Rush, said in the statement. “Matt’s experience driving year-over-year growth, leading key partnerships, and ensuring top-tier quality and patient experi-

ence strategies all strongly aligns to Rush’s priorities and our strong commitment to innovation and growth.”

Walsh will run the operations of the system, including Rush University Medical Center, Rush Oak Park Hospital and Rush Copley Medi- Matt Walsh cal Center, the statement said, focusing on financial strength, quality, equity and employee engagement.

While serving at Geisinger, Walsh co-led its clinical enterprise of 3,200 providers, 11 hospitals, and more than 250 outpatient clinics and surgery centers, the statement said.

Prior to Geisinger, he spent

nearly 20 years with the Henry Ford Health System in Detroit.

In April, Geisinger Health and Kaiser Foundation Hospitals launched a nonprofit entity, Risant Health, to acquire health systems and create a national network for value-based care. Geisinger is Risant’s first acquisition.

“I’m looking forward to building upon the organization’s already outstanding foundation of clinical quality, safety and commitment to health equity,” Walsh said in the statement.

Walsh serves on a Pennsylvania YMCA board and previously sat on the boards of the American Diabetes Association and Focus: Hope.

Former state, city officials win Democratic National Convention A local firm was chosen to oversee the preparation of the United Center and its surrounding area for the big event next summer

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

Find your next corporate tenant or leaser.

Connect with Suzanne Janik at sjanik@crain.com for more information.

28 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

An advisory firm run by former state of Illinois and city of Chicago facilities officials has been tapped to oversee the preparation of the United Center and its surrounding area for the Democratic National Convention next summer.

The DNC’s Chicago 2024 Host Committee and the Democratic National Convention Committee announced Nov. 16 that Chicago-based K+P Advisory will serve as the “owner’s representative” for the event, which will be centered at the Near West Side arena in the third week of August. The owner’s representative is the “inhouse expert on design, construction and event contracting and works as part of the larger team responsible for preparing the United Center and its surroundings,” the committees said in a statement.

K+P Advisory is co-led by Ayse Kalaycioglu, who was chief operating officer for the state’s Department of Central Management Services from 2019 through the beginning of this year.

Among other projects, she oversaw the sale of the James R. Thompson Center to Chicago developer Mike Reschke, who is poised to modernize the dilapidated building in partnership with Google. Prior to that job, Kalaycioglu spent more than four years as deputy commissioner of Chicago’s Department of Fleet & Facility Management.

Her partner at the firm is An-

UNITED CENTER

By Danny Ecker

thony Pascente, who also worked in the state’s CMS department and previously was deputy chief operating officer for the city of Chicago under former Mayor Rahm Emanuel.

Boost West Side communities K+P, a city of Chicago certified women’s business enterprise, will oversee a number of contractors to help the United Center stage the high-profile event, which not only involves activities inside the arena but also an extensive security perimeter around it. Host Committee and city of Chicago officials have stressed the need to ensure that local vendors are involved in putting on the event and that it helps boost neighborhoods on the Near West Side.

The committees said in the statement that K+P was chosen

in part for its plan to incorporate a paid internship program “that will engage neighboring West Side communities in the convention process.”

“We are committed to delivering the best convention to date, showcasing our world-class city and maximizing contracting opportunities for small, minority and women-owned businesses,” Kalaycioglu said in the statement.

The host committee, led by Executive Director Christy George, is in the midst of a campaign to raise $85 million to pay for the DNC. That money will be spent on things such as renting the arena, promoting the event and sponsoring tours and receptions for convention attendees. Congress is expected to provide at least $50 million for security during the convention.

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Environmental leaders chart path toward more sustainable communities of color, increased access to nature generation shift in economic and environmental investment is a radically better version of ourselves.”

Davis advised non-Black allies to recommend Black organizations for funding and opportunities to create equitable and sustainable communities. She noted that her organization received a $10 million grant from the Environmental Protection Agency to develop technical assistance centers, offer training and provide other community resources around the Midwest.

During the panel, each speaker shared their vision for what sustainable and equitable communities should look like. For Davis, achieving that goal means allowing communities to own the homes and businesses within the area, she said. To her, the term “investor” gives her pause because it “means colony. It means domination. It means wealth disparity.”

“White people have never solved the problems of Black people and never will. And [they] shouldn’t and needn’t,” Davis said. “If Black people have the same opportunities that everybody else has, we’re more than capable. And we’ve got the soul and the history to prove [that] we are people of triumph.”

To Garcia, building sustainable and equitable communities involves creating more seats at the proverbial table and providing clean air, water and energy for everyone, she said.

The panel included (from left) Tim Swanson, founder, president and CEO of Inherent Homes; Juan Reyes, co-program director of Great Lakes Chapter of Latinos Outdoors; Naomi Davis, founder and president of Blacks in Green; Juanita Garcia, senior project manager at Pepper Construction; moderator Jim Kirk, group publisher and exective editor of Crain’s Chicago Business; and Angela Tovar, chief sustainability officer of the City of Chicago.

BY TATIANA WALK-MORRIS

A

s climate change continues to bring new challenges for Chicago and other major cities across the country, how are communities of color organizing to mitigate these effects and strengthen their own relationships and access to nature? A group of prominent local environmental justice leaders recently gathered at the Chicago Academy of Sciences / Peggy Notebaert Nature Museum to share their insights on how traditionally marginalized groups and low-income neighborhoods are working toward a more equitable and sustainable future for all.

In a panel discussion moderated by Crain’s Chicago Business group publisher and executive editor Jim Kirk, Crain’s Content Studio convened five local business, nonprofit and government leaders to discuss the progress of the city’s environmental justice efforts and the pathway toward addressing the inequities created and exacerbated by climate change.

Among the speakers were Naomi Davis, founder and president of Blacks in Green; Juanita Garcia, senior project manager at Pepper Construction; Juan Reyes, co-program director of Great Lakes Chapter of Latinos Outdoors; Tim Swanson, founder, president and CEO of Inherent Homes; and Angela Tovar, chief sustainability officer of the City of Chicago. The Nature Museum sponsored the Nov. 9 event, and introductory remarks were provided by Nature Museum President and CEO Erin Amico.

when spending time outdoors and shaped their family’s experience in outdoor spaces, Garcia said.

“It wasn’t until I traveled outside Chicago and realized these inequities we had here in Chicago,” Garcia said during the panel.

Traveling beyond the city limits helped her to understand “how much just things like trees in a neighborhood made a difference in urban environments and how warm or cool the space was, and urban planning.”

Tovar reflected on her upbringing in the South Chicago neighborhood, an area that shifted in the 1980s and ’90s following the departure of the steel industry. From there, she studied urban planning to understand the tools available to restore the community to its former glory. She eventually realized one example of the intersection between land use and environment was the zoning of brownfields in the neighborhood, which hadn’t been rezoned for other purposes.

“If we can’t change what [the brownfields] are, then we are going to forever face that pollution of the community,” Tovar said.

“There has to be a way out. We’re not going to just accept this in perpetuity that this is our destiny forever, because we can’t afford it.”

When asked how they encounter environmental justice in their work, some panelists recalled their childhood and familial experiences with climate inequities.

Regarding how companies can contribute to a more equitable and sustainable economy, Swanson noted that the city’s racial inequities result in significant financial losses for Chicago businesses. The work his organization has done to build housing units for Chicagoans will ultimately add to the city’s tax base and contribute to the long-term health of those communities, he said.

Garcia shared an anecdote about her mother driving out to a forest preserve with fellow Chicago Public School students to hang out, but they were chased out of the area because “they were Black and brown students.” That experience caused her mom to feel uneasy

“I proudly say that we are making money building housing better than any housing being built with people who are being paid better than any other place. And we’re small,” Swanson said. “What actually happens in a city like Chicago when you see that single

P029_CCB_20231127.indd 29

“I’d like to envision this big table where there are more seats at the table, and we don’t have anyone outside looking in,” Garcia said. “And that we’re not thinking anyone has to give up a seat for someone else or have to compromise that seat for someone else.”

Regarding how she envisioned equitable and sustainable communities, Tovar offered a concise response: “It’s the vision that people that are from there dream for it to be sustainable longterm.”

Sustainability Center, C3, events are all part of recharged push for community climate action The panel discussion is just one example of the Chicago Academy of Sciences / Peggy Notebaert Nature Museum’s increased focus on reaching the city’s frontline communities to offset environmental hazards that plague its historically marginalized neighborhoods. The Nature Museum also recently opened its longanticipated Sustainability Center, a community resource hub for education and actionable green living. Visitors to the Center can learn more about the Chicago Conservation Corps (C3) program, which sparks lasting change in the city through grassroots community organization and climate action. In the next five years, the Nature Museum and C3 have set a goal to reduce 4,000 metric tons of carbon emissions and reclaim 3,000 square feet of land through its community-based projects led by C3-trained leaders.

11/17/23 1:28 PM

RIVIAN

BLOOMBERG

From Page 3

Marketplace health insurance plans will cost more next year in many parts of Illinois The average rate change for plan premiums across all areas of the state is about a 4% hike

By Katherine Davis

Many health insurance premiums for plans offered on the Affordable Care Act Health Insurance Marketplace in Illinois will cost more next year as health care costs continue to rise.

For the Silver plan, the secondcheapest, the premium cost in most counties is changing in a range of 5% cheaper to 15% more expensive, according to the Illinois Department of Insurance.

The average across the state is about a 4% increase.

According to the enrollment site, the second-lowest cost Silver plan for a 35-year-old person living in the Chicago area is offered

by Aetna and costs $381.77 per month. Some Illinois families may qualify for financial help to reduce the cost of monthly premiums via tax credits, the department said.

Illinoisans can check their eligibility at GetCoveredllinois.gov and other subsidies may be available via the Inflation Reduction Act. Last year, nearly 343,000 marketplace plans were selected during open enrollment and more than 88% of enrollees received advanced premium tax credits, according to the IDOI. Marketplace plans are typically used by Americans who don’t already receive health insurance

RIVER CITY From Page 3

around 95% early this year, Golson said, “we decided to test the market” by putting it up for sale. The asking price was not published.

With no satisfactory offers in six months, “we’re happy to stay around and continue operating it,” Golson said, and “continue to add value to the building.”

Marc Realty and Wolcott started courting River City condo owners in January 2016 with an offer of about $81.4 million, but failed to get enough support — 75% of the owners, as required by Illinois law — for the deal to go through. A second offer at $92 million also

from an employer, a family member or government plans like Medicaid and Medicare.

Illinois is offering more than 400 plans from 12 insurance companies next year, up from five carriers about three years ago, the Insurance Department said. Aetna is new to the list this year, offering plans in Cook, DuPage, Kane, Lake and McHenry counties. Other existing providers include Cigna, Blue Cross Blue Shield of Illinois, Molina Healthcare and UnitedHealthcare.

Changes to access The Chicago area will have the most coverage options in the state, which is similar to prior years, according to data from the department. However, plan rates will grow by more than 10% in some Chicago-area counties.

Premium costs in Illinois land near the middle when compared to all 50 states. Illinois ranks at No. 28 in a Kaiser Family Foundation analysis, which shows the average second-lowest-cost Silver plan premium for a 40-year-old across counties in Illinois in 2024 is about $473 per month. The most expensive plan was offered in Vermont at $950 per month. The lowest is offered in New Hampshire for $335 per month.

Open enrollment for marketfailed to win over enough owners, but a third offer at $100 million got the necessary votes in December 2017. The firms paid nearly 23% more than their original offer to get the property.

A couple of years later, the firms got flak from preservationists and other fans of Goldberg’s Brutaliststyle building for painting his original bare concrete interior walls white.

Deferred maintenance Now that the building is off the market, one former unit owner who strongly opposed the firms’ purchase of all the condos to convert to rentals was frustrated.

“All Chicago got out of this sixplus-year saga was the sacrile-

30 | CRAIN’S CHICAGO BUSINESS | NOVEMBER 27, 2023

place health insurance plans began Nov. 1 and runs through Jan. 15. For coverage to begin Jan. 1, consumers need to enroll by Dec. 15. Otherwise, coverage will begin at a later, unspecified date, the Insurance Department said.

Once the enrollment period closes on Jan. 15, consumers will only be allowed to purchase an insurance plan if they have a qualifying life event, such as losing jobbased coverage, getting married, having a child, adopting a child or moving.

Changes to how Illinoisans access marketplace plans are underway. New legislation was passed this year to allow Illinois to establish its own health care insurance exchange. Under Illinois’ current system, the state pays for access to a partnership exchange marketplace operated by the federal government in which residents enroll via HealthCare.gov.

In the new model, which will roll out in phases, Illinois will have control over its health care insurance market and insulate itself from any changes in federal policy.

Other states, including Georgia and Pennsylvania, have set up their own marketplace exchanges in recent years.

Health care costs for employers are rising next year, too. Estimates from firms like Mercer and Aon project the total health benefit cost per employee to rise anywhere from 5.4% to 8.5% next year. gious painting white of a soaring 14-story Brutalist atrium,” Dan Pepper said in an email.

But Golson said he doesn’t regret the fraught process of purchasing the building or the rehab.

“I believe it was a good idea because the building would have failed as a going concern if we hadn’t acquired it,” Golson said.

As individual condos, he said, the units “would have become unmarketable because there was this horrific deferred maintenance.”

Nearly half the $15 million in rehab costs went to restoring the long, spectacular skylight that winds across the top of the building, Golson said.

taxes,” John Shakarjian, Rivian’s associate general counsel for real estate and construction, said in an interview. “There’s no cash changing hands, there’s no cash being generated, there’s no movement of money.”

Shakarjian said Georgia’s system for economic development projects was unusual among US states and even among countries abroad. He noted it’s common for companies in Georgia to use the phantom-bond structure.

The bonds simply act as a “vehicle” to provide the tax break to Rivian, said Andrew Capezzuto, chief administrative officer and general counsel for the Georgia Department of Economic Development. He said countless phantom bond deals have been done to provide incentives.

“A lot of other states have the statutory authority to issue abatements and that just doesn’t exist in Georgia,” he said. “So some clever lawyers came up with this way in which they can do it — by transferring title of the asset to a tax exempt entity.”

EV windfall Rivian has agreed to make payments-in-lieu-of-taxes — known as a PILOT — of $1.5 million that will gradually increase to $20.4 million by 2047.

The company guaranteed it will pay at least $300 million, though that could increase if Rivian spends more than its initial commitment.

Currently, the area that will be home to Rivian’s new factory generates tax revenue of only about $80,000, according to the state.

The reason why such deals are known as phantom bonds is that

TAX CLIMATE From Page 3

2017, when Republican Gov. Bruce Rauner was in office.

Changes to the state’s corporate tax structure are partially responsible for that downward turn. Although the Tax Foundation has long categorized the corporate tax climate in Illinois to be unfavorable toward business, it now considers the state to be among the worst in the country on that front.

Loughead attributed that largely to one specific change: “Illinois used to offer full expensing for investments in machinery and equipment purchases.

When that expired this year, that put Illinois at a competitive disadvantage compared to a lot of other states that do offer bonus depreciation.”

Individual income tax rate The Tax Foundation also dings Illinois for the way it levies property taxes, unemployment insurance taxes and sales taxes.

One factor giving Illinois a boost, at least in the eyes of the

no actual debt service payments are made, unlike traditional transactions. As part of this structure, Rivian’s rent will always equal the debt service costs and because Rivian is the sole bondholder, money doesn’t change hands.

“Since the company is both the tenant and bondholder, such principal and interest payments may be constructively made and may be deemed to be made when due,” the securities filing reads.

Controversy So far, $5 billion of phantom bonds have been issued as part of the agreement as Rivian kicks off the project, according to Shakarjian, the company’s lawyer. If costs rise, Rivian can request that the JDA increase the bond’s size to shield those costs from higher property taxes, he said. The JDA has authority for as much as $15 billion of Rivian’s project costs to be abated.

Georgia’s economic development agency has said that the deal is similar to agreements put in place for other companies like Kia Corp. and SK Innovation.

The deal faced controversy and a legal challenge in the state. But in August, a judge validated the bond agreement.

One local resident in a 2022 column in the Morgan County Citizen said the EV company was being given a “free ride” by Georgia.

Capezzuto, the counsel for the state’s economic development arm, said that Rivian isn’t being taxed at full value but it’s akin to sacrificing a few slices of pie.

“But Rivian might have chosen to go somewhere else,” he said. “If Rivian chose to go somewhere else, we would have no pie at all.” index: The state maintains a flat individual income tax rate of 4.95%. The report prefers that approach over tier-based systems that levy higher percentages on individuals with greater incomes.

“Illinois’ ranking would actually be a lot worse if it weren’t for the flat individual income tax rate,” Loughead said. “If they were to adopt a graduated income tax, especially one at a high rate, that could really tank Illinois’ score. The flat tax is really the one bright spot in Illinois’ otherwise burdensome tax code.”

Loughead also noted that Illinois’ overall drop is in part the product of changes to the tax codes in other states. Iowa, for example, jumped from No. 38 to No. 33 this year after making major changes to the way it levies income taxes. Ohio also passed Illinois in the rankings.

“As other states around the country are making dramatic gains in competitiveness, that’s going to make Illinois look worse by comparison,” she said. “That’s making Illinois more of an outlier over time.”

Rehabbed mansion in Lake Forest sells for $7.75 million

ChicagoBusiness.com President and CEO KC Crain Group publisher Jim Kirk, (312) 397-5503 or jkirk@crain.com

A

Lake Forest mansion designed by David Adler just sold for more than twice its sale price in 2020, before a round of rehab at the house and the pandemic-driven lift in the Lake Forest market.

The seven-bedroom house on Lake Road, built in 1928, sold Nov. 15 for $7.75 million. The sellers, identified in Lake County public records as David and Kristin Keenan, paid $3.25 million for the property in January 2020.

The Keenans could not be reached. They listed the property Sept. 12 with Katie Hauser and Meg McGinnis of Compass, and it went under contract in a week.

The house sold for the highest price paid in Lake Forest since the estate of the late Nancy Hughes sold for $12.95 million almost exactly a year ago. Setting aside that outlier, the Keenan property is the highestpriced home to sell in Lake Forest in at least five years, according to real estate records. The only other Lake Forest mansion to sell for over $7 million in that time went for $7.5 million in August 2022.

At $7.75 million, the Keenans landed the Chicago area’s sixth-highest home price so far in 2023. Compass agent Joanne Hudson represented the buyers, who are not yet identified in public records.

The Keenans’ updates clearly boosted the home’s marketability, but the recent housing boom also played a role. When they bought the property it had been for sale for a decade, starting with an asking price of nearly $9.7 million, or almost three times what they paid in January 2020. That would turn out to be the eve of the COVID-19 pandemic, which combined with super-low interest rates to ignite an epochal housing boom. In Lake Forest, the change was eye-popping. It breathed new life into a droopy market where big, vintage mansions often sat unsold for years.

VHT PHOTOS

The property went for more than twice its pre-pandemic price I By Dennis Rodkin

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