Crain's Chicago Business

Interest rates slow neighborhood comebacks

This scam is costing Chicago restaurants big

‘Friendly fraud’ is on the rise, and it’s no way to treat a friend

BY ALLY MAROTTI

Imagine dining at a restaurant, paying with your credit card, then later reporting the charge as fraud and claiming a refund. Called “friendly fraud,” this scam is spreading across Chicago’s restaurant scene.  Retailers have long struggled with friendly fraud, often perpetrated by consumers who order goods online and report the merchandise as damaged or not received. As the pandemic forced restaurants to shift their sales online, their exposure to friendly fraud increased.

Industry data shows the rate of credit

card chargebacks to restaurants has quadrupled since COVID-19 hit, putting more pressure on pro ts at a time when rising costs are squeezing their slim margins. When a customer requests a refund, restaurants lose the dollar value of the meal and the server’s tip. On top of that, they pay a fee to the credit card company or processor. Add labor costs if the restaurant decides to ght the refund.

“It’s brutal,” says Louie Alexakis, managing partner of upscale Greek restaurant Avli, with ve locations in the Chicago

For Chicago sports, it’s a bleak picture.

BY DENNIS RODKIN

Belinda Ewell has bought, rehabbed and sold a few dozen homes in Chatham and other South Side neighborhoods over the past eight years, at the rate of four or ve a year, but she plans to complete just one in 2023.

And that’s only because work on the property, an Avalon Park bungalow, was already underway when the Federal Reserve’s in ation-busting interest rate hikes torpedoed the housing market.

“Interest rates are pretty much chilling things in our South Side and south suburbs market,” said Ewell, who heads B&B Realty. Borrowing costs “have a big effect on buying power when you’re in the $300,000, $350,000 market. I had to slow down.”

e Fed’s series of increases, designed to tame rampant in ation, have had the intended e ect of reining in an epochal boom in the nation’s housing market that was verging into bubble territory. at’s a positive, overall.

But one of the negative e ects of

JOHN R. BOEHM

JOHN R. BOEHM

REAL ESTATE: A former school turned home in Humboldt Park. PAGE 31

THE TAKEAWAY Head of Tillman Foundation is in a new documentary.

DAN MCGRATH

A rehab wave that was revitalizing homes on the South Side and in the south suburbs is drying up

Louie Alexakis, managing partner of upscale Greek restaurant Avli.

Belinda Ewell

Garcia faces crypto questions in mayoral race

Nasty as the collapse of crypto king Sam Bankman-Fried’s empire has been, equally tawdry is how Illinois members of Congress and candidates for Con gress bene ted from his largesse, apparently asking few if any ques tions while he spent tons of money on their behalf.

e media has done a lousy job of pulling together the complex story of what FTX boss Bankman-Fried and associated political action funds did, covering it only in bits and pieces. Let’s just say that U.S. Rep.-elect Jonathan Jackson might well not be headed to D.C. if most voters had known Bankman-Friedfunded groups were spending more than $1 million in the nal stages of the race to get him elected. Jackson didn’t respond to my request for comment.

Most recipients were Democrats, but downstate Republican Rodney Davis got some for his failed re-elec tion bid.

ose congressional races now are history. But not the race for mayor of Chicago, where U.S. Rep. Jesus “Chuy” Garcia is running for a

new job and has $200,000 in crypto baggage to explain.

e question: How and why did a PAC heavily funded by Bank man-Fried—he gave Protect the Future PAC at least $27 million before his company hit the rocks— come to spend $199,853 on ads and mailers this spring urging a vote for Garcia in a Democratic congressio nal primary race in which he was unopposed? Are Chicago voters really expected to believe that the money sort of fell o a truck and had absolutely nothing to do with Garcia’s service on the House Fi nancial Services Committee, which regulates crypto?

Garcia has said little about the matter. In June, in the middle of a story that focused on Jackson, the Sun-Times reported that Garcia spoke with Bankman-Fried, but only about how the government handled the COVID-19 pandemic and its impact on Latinos. Garcia repeated that in a recent WTTW interview.

Garcia’s o ce said he didn’t have time for an interview now. It did provide a senior adviser to his

mayoral campaign, Manny Diaz, to eld some questions.

Diaz underlined that the money from Protect the Future—it also spent $263,453 on Democrat Nikki Budzinski’s successful run for a downstate congressional seat—was an “independent expenditure” over which Garcia legally could have no control or knowledge. Right. He also noted that Bankman-Fried directly donated to lots and lots of pols all over Washington. at’s true. e Biden Victory Fund got $50,000, the Democratic Congressional Cam paign Committee $250,000 and Illinois congressional hopeful Gil Villegas $2,900. Apparently there’s a lot of concern about pandemic preparation out there.

But Diaz disputes that Sun-Times story. In fact, he says, Garcia spoke not with Bankman-Friedman but his brother, Gabriel Bankman-Fried, who has handled political chores for the family and, between 2019 and 2021, just happened to be on the payroll of another Illinois con gressman who serves on Financial Services, Democrat Sean Casten. (Casten’s spokesman says it’s not

GREG HINZ ON POLITICS

clear how Gabriel Bankman-Fried got hired, but he only worked on constituent mail.)

Why would the family’s PAC throw all that money at Garcia? “ at’s a good question. I don’t know,” Diaz replied. Shouldn’t Garcia, who’s run ning as a populist, have been wary in this matter? After all, populists such as U.S. Sen. Elizabeth Warren, D-Mass., say poor FTX accounting threatens billions in customer funds and “appears to be an appalling case of greed and deception.”

e chat between Bank man-Fried and Garcia was about the pandemic, not crypto, and po litical spending was not discussed, Diaz replied. He added that Garcia favors appropriate crypto rules, and that he’s returned a $2,900 personal campaign contribution from Sam Bankman-Fried.

So, what should voters make of this?

Garcia indeed appears to have had lots of fellow travelers inside the Beltway in watching gold roll their way. Washington Republicans might nd this worthier of a probe than the secrets of Hunter Biden’s laptop. But voters may expect something, too, especially since money Garcia didn’t have to spend promoting himself in his new district in June is still avail able for his mayoral campaign.

Rival mayoral hopeful Paul Vallas is hopping on the issue. He contends the episode means Garcia “is morally corrupt, that he is lazy in his stewardship of the public’s trust in him, or that he is too naive to e ectively guard this city from the in uence of big money interests.”

Stay tuned, folks. I suspect we’ll be hearing more on this one.

For Chicago sports, it’s a bleak picture

APackers-Bears matchup for the rst Sunday of December, and the anticipation level suggested a Mid-Suburban League JV scrimmage.

Team records—4-8 vs. 3-9—were a factor, as was the uncertainty over each team’s quarterback scenario. At best, we’d have a 39-year-old in creasingly shot ghter vs. a colt-like 23-year-old who is trying to prove the Bears have it right at the position that has forever vexed them.

At worst, Jordan Love vs. Nathan Peterman. In cold, lakefront bluster. Man, if Bears-Packers can’t save us, Chicago’s sports landscape is as forlorn as it has been in recent memory.

e Blackhawks have lost eight in a row as this is written. Not to put too ne a point on it, but they stink. e game presentation remains creative and fun, the anthem is still a thing, the new “voices” are trying their best and Jonathan Toews is out there plugging away with trademark “Captain Serious” purpose.

But Patrick Kane evokes Magic Johnson in a pickup game at the Y with actuaries and accountants. It’s only a matter of time before a no-look pass caroms o somebody’s nose.

When Rocky Wirtz took over for his late father and oversaw the pre vious restoration, a championship nucleus was in its formative stages. Rocky hired John McDonough to reacquaint the city with it. What followed was pretty special.

And just awful how it ended.

e road back is long and uncer tain, with an unproven 44-year-old Danny Wirtz assuming the Mc Donough role, in charge of it all. Patience, remember, is a virtue.

e Bulls are sub-.500 and lack any sort of consistency. Injuries can’t be discounted, but the fact that

they matter so much speaks to an obvious lack of depth on the roster.

Better basketball minds than mine had no issue with the Bulls lavishing a $215 million “max” contract on Zach LaVine, knee trouble notwithstanding. I look at LaVine and I see Jimmy Butler: tough, skilled and industrious, but not quite at the premier level that determines the NBA pecking order.

To put it another way, if Jimmy Butler or Zach LaVine is your best player, you’re not a championshipcaliber team. And with Lonzo Ball stranded at the corner of Mark Prior Lane and Michael Kopech Way, you have to squint pretty hard to see title contention in the Bulls’ future.

Well, baseball will be along in a few months. Feel better? Not sure?

Can’t fault the White Sox for Jose Abreu’s departure. Admired as he is, three years and $58 million seems excessive.

Abreu is still a dangerous hitter. But he’s not much more than adequate in the eld, and he can’t run, and he came to symbolize the glaring disparity in athletic ag gressiveness which the Cleveland Guardians exploited in a September series sweep that de ned the AL Central race.

Is Andrew Vaughn an upgrade at rst base? Gavin Sheets? It’s up to new manager Pedro Grifol to gure it out. But if Abreu’s departure and pitcher Mike Clevinger’s arrival are the extent of the White Sox’s o -sea son moves, last season’s 81 wins might be hard to top.

en there’s the Cubs, whose 17-8 nish got them to 74 wins and prompted talk that their current renovation might be further along than we’d believed. Playing in, perhaps, the worst division ever assembled is a mitigating factor.

e scorched-earth rebuild that

produced a World Series title in 2016 was hitter-driven: Anthony Rizzo and Javy Báez were here, Kris Bryant and Kyle Schwarber were on their way. e Cubs had the resources to land Jake Arrieta, Dexter Fowler and Kyle Hendricks in trades, and the resolve to add Jon Lester as a free agent.

e current e ort seems more pitcher-dependent, which is always a gamble.

And even as the Cubs were going 17-8, the lack of star power stood

DAN McGRATH ON THE BUSINESS OF SPORTS

out. Whom would you point to and say, “He’s going to be here when they’re good”: Nico Hoerner? Prob ably. Christopher “Smiley” Morel? Maybe.

A pretty bleak picture all the way

around. We must look to the Sky for deliverance.

Wintrust

Crain’s contributor Dan McGrath, president of Leo High School, is a for mer Chicago Tribune sports editor.

BY STEVE DANIELS

JOE CAHILL ON BUSINESS

Pritzker pins electric vehicle hopes on subsidies

With losses piling up, Gov. J.B. Pritzker is scrambling to sweeten state subsidies for electric vehicle production.

As my colleague Greg Hinz reports, a bill introduced Nov. 30 and quickly passed by the General Assembly would increase electric vehicle tax credits, extend their duration and expand eligibility.

e move comes as Illinois’ push into the fast-growing EV sector has stalled. Illinois started out strong, attracting California-based electric truck maker Rivian to a former Mitsubishi plant in Normal ve years ago. In 2021, Canadian man ufacturer Lion Electric announced plans for an electric school bus factory in Will County.

Since then, not much. Au tomakers racing to phase out gas-powered vehicles as soon as 2035 have bypassed Illinois as they announced dozens of new produc tion facilities across the country.

Particularly worrisome is the state’s failure to win a single electric vehicle battery plant.

Batteries are the crown jewel of electric vehicle production, representing about 30% of the value in a plug-in car. Yet none of the roughly 20 battery plants announced so far is coming here. Even Rivian is building its battery plant in Georgia.

facturing generates 36,000 jobs and $28 billion in annual economic activity, according to the Illinois Manufacturers’ Association.

To soften that blow by tapping into the growing electric vehicle segment, Illinois needs to convince manufacturers that the state is a good place for multibillion-dollar investments in building new facili ties and retro tting existing ones.

In many ways, Illinois looks like an ideal location for electric vehicle investments. We o er important technical expertise, in cluding advanced battery research at Argonne National Laboratory in Lemont. We also have a highly skilled workforce, manufacturing know-how, a convenient midcon tinent location and great transpor tation systems.

DOWNSIDES

in Cboe

the

exchange run by Cboe Global Markets, including prominent Chicago names DRW and Jump Trading.

Collectively, the new equity investors will hold an unspeci ed mi nority stake in Cboe’s crypto unit, which was established following Cboe’s May acquisition of ErisX. ErisX, founded four years ago, runs an exchange facilitating spot-market trading of tokens as well as cryp

BY ALBY GALLUN

Sam Zell’s apartment compa ny is expanding into the shortterm rental market with the biggest name in the business: Airbnb.

Airbnb, the popular vaca tion-rental platform, is teaming up with about a dozen apart ment landlords, including Zell’s rm, Chicago-based Equity Res idential, on a new listing ser

vice that will allow tenants in their buildings to sublease their apartments on a short-term ba sis.

It’s something that landlords have prohibited in general, but the program o ers them a new revenue source and a feature that could help them attract new renters.

e partnership covers 175 buildings in more than 25 U.S. cities, including Atlanta, Hous

ton, Miami, Pittsburgh, Port land, Ore., and San Francisco, according to an Airbnb state ment. No Chicago properties are participating. Other landlords in the program include Charleston, S.C.-based Greystar and UDR, based in suburban Denver.

Founded by Zell, its chair man, Equity Residential is the sixth-largest U.S. apartment

Automakers will need more bat tery plants, giving Illinois a chance to catch up. But the window of opportunity shrinks every time a plant goes elsewhere.

Compounding those disap pointments is concern about the fate of existing Illinois auto plants in an all-electric future. Ford’s as sembly plant on Torrence Avenue in Chicago and Stellantis’ Belvidere factory have anchored auto pro duction in Illinois for generations, supporting thousands of well-paid jobs that send economic ripple e ects across their communities.

Yet neither company has com mitted to converting its Illinois plant to electric vehicle produc tion. In an ominous sign for Ford’s Chicago plant, industry insiders expect an Ontario factory to make the initial electric versions of the Explorer SUV, a mainstay of Tor rence Avenue.

EXTINCTION RISK

Without a massively expensive overhaul, these plants will almost certainly shrink and eventually go dark as gas-powered vehicles roll into the sunset. Also at risk is an ar ray of Illinois companies that make parts for internal combustion engines, which face extinction if they can’t nd a place in EV supply chains that require far fewer parts. at would be a heavy blow to Illinois, where auto-related manu

Yet these advantages, plus a rea sonably generous subsidy package, haven’t carried the day with EV battery makers. And while it’s hard to pinpoint a single deciding factor in any given plant siting decision, Illinois’ downsides as a business location surely aren’t helping its sales pitch. e state is known for relatively high taxes, costly work ers’ compensation and cumber some permitting processes. Com panies also worry that clean energy legislation enacted last year will drive up electricity rates, a major expense for manufacturers and an area where Illinois once had a cost edge over neighboring states.

On top of that, Pritzker just pushed through an amendment to the state constitution that gives labor unions more power, reinforc ing Illinois’ reputation for hostility to business.

Unable or unwilling to ad dress these negatives, Pritzker is counting on a spruced-up subsidy package to change Illinois’ luck. Major changes include allowing more companies to qualify for EV tax breaks, potentially bene ting existing facilities like Torrence and Belvidere, as well as parts makers. Payroll tax credits would rise from 25% of state tax liability to as much as 100% in some cases, and their term would increase to as long as 30 years from the current 15-year duration.

According to the state’s econom ic development agency, the chang es re ect feedback from “industry stakeholders” as Illinois pursued EV companies. e revised pack age evidently comes closer to the incentives o ered by states that have won battery plants.

Pritzker is smart to make Illinois’ subsidies more competitive. A real winning strategy—in electric ve hicles and every industry—would do the same for the state’s business climate.

Billionaires are getting their tax bills, too

BY DENNIS RODKIN

Ken Gri n may be savoring his new life in Florida, but Cook County Treasurer Maria Pappas just mailed him a million-dollar souvenir of his old hometown.

Second-installment Cook County property tax bills, de layed several months, are now hitting property owners’ mail boxes. A report out Dec. 1 from Pappas shows Chicago residen tial owners are being billed a combined $3.83 billion for the whole year, slightly more than

buildings, still owned by Grif n, who moved his family and his business to Florida over the summer, and the one he sold in October for $10.225 million.

MEDIAN BILL

e median residential tax bill in Cook County for tax year 2021 is $4,625, according to Pappas’ report. Gri n is paying at least 424 times that amount.

Gov. J.B. Pritzker and Illinois rst lady M.K. Pritzker will re ceive the fourth-largest proper ty tax bill in the city. ey owe $290,502 on the As tor Street mansion they bought in 2007 for $14.5 million.

e governor is re portedly worth $3.6 billion.

highest for a single property owner in the city. Some larger bills are going to cooperative ly owned buildings where the tax bill is divvied up among all owners, or recent condo devel opments, such as the Tribune Tower, where individual units haven’t yet been delineated in the tax system.

e third-highest tax bill goes to Richard and Michaela Par rillo, who tried for a few years to sell their mammoth Burling Street mansion for $50 million and later $45 million before tak ing it o the market. e Parril los’ bill is $326,275.

commercial owners’ share, $3.82 billion.

Crain’s took a look at the big gest residential bills in the city for the full tax year. If your tab feels big, take heart: Citadel chief Gri n, by far the biggest residential property taxpayer in the city, is on the hook for a little more than $1.96 million.

at’s the combined total of the bills for six downtown Chi cago condos, in three di erent

ere’s at least one other bil lionaire household receiving a tax bill that’s among the top 10.

Mark Walter, CEO of invest ment rm Guggenheim Part ners and part-owner of the Los Angeles Dodgers, is worth $5.3 billion, according to Forbes. With his wife, Kimbra, Walter is getting a bill for $562,853 for the giant mansion they built on Or chard Street in the mid-2010s.

e Walters’ bill is the second

After the Pritzkers come the owners of a No. 9 Walton condo who have obscured their names in public records by owning it through a legal entity. eir to tal: $275,211.

TRUMP PENTHOUSE

e sixth-largest tax bill in the city, $250,237, goes to the new owners of the 89th- oor pent house at the Trump Interna tional Hotel & Tower, which sold for $20.5 million in March. e Tribune later identi ed them as Bryan Cressey, a private-equity executive, and his wife, Iliana Sweis.

e Trump space was un n ished when the couple bought it. eir tax bill is likely to increase signi cantly after they build the space out. So far in 2022, only one property in the Chicago area has sold for more than this couple paid: a St. Regis unit that went for $20.56 million. Like many other new-construction properties, this one doesn’t yet have a broken-out bill in Pap pas’s report.

e city’s seventh-biggest bill belongs to Steve and Nancy Crown, identi ed by the Chica go Tribune as the buyers who in April paid $17.4 million for a full- oor condo one ight down from Gri n’s multi oor hold ings at the top of No. 9 Walton.

eir tax bill is $209,614.

e Crowns’ net worth is not laid out individually, but the ex tended Crown family is reported by Forbes to be worth $10.2 bil lion.

Two of the remaining top 10 tax bills—Nos. 8 and 10—belong to properties whose owners’ names are obscured in public records.

In between at No. 9 are the owners of a penthouse at 2550 N. Lakeview, the tower built overlooking the Lincoln Park lagoon a decade ago. Marianne Berger, who paid almost $7.5 million for the condo in 2013, and her husband, orthopedic surgeon Richard Berger, have a total tax bill of $213,578.

The tax winners and losers among trophy towers

Owners of the Willis Tower, Prudential Plaza and Aon Center received unwelcome news from the county. But the owner of the Merchandise Mar t can’t complain.

BY ALBY GALLUN

At 110 stories, Willis Tower is Chicago’s tallest and most fa mous skyscraper. When it comes to property taxes, it’s the city’s biggest loser.

e building’s tax bill jumped to $50.2 million this year, up 29.4% from 2021, according to the Cook County treasurer. As usual, Willis Tower leads the list of the county’s most highly taxed prop erties, but it also stands out this year for the size of its increase.

e main reason: e building’s

Property taxes rose at 24 of the 50 commercial properties in Chica go with the highest 2022 tax bills and fell at 26, according to the treasurer.

A DROP AT THE MART

Landlords that lucked out in clude Vornado Realty Trust, the New York-based owner of the Merchandise Mart, the massive art deco office building on the Chicago River. The property’s taxes dropped 1.4%, to $35.5 million, the second-highest tax bill in the county.

degrees, the Willis Tower case shows they don’t always get ev erything they want.

Kaegi’s office last year ini tially placed a $1.24 billion value on the building at 233 S. Wacker Drive. That was up 78% from 2020, but still below the $1.3 billion that the Blackstone Group paid for the property in 2015. It also was well below the building’s $1.78 billion ap praised value in 2018, when the New York-based investment firm refinanced the property.

assessed value jumped 43%.

Owners of many trophy build ings in downtown Chicago were bracing for big tax hikes this year after Cook County Assessor Fritz Kaegi reassessed them in 2021. But a lot of landlords succeeded in appealing their assessments with the Cook County Board of Review, reducing their tax hit.

But other valu able office prop erties didn’t fare so well, including Prudential Plaza north of Millen nium Park, which absorbed a 24.5% hike, and the Aon Center next door, with a 21.6% jump.

Critics of the county’s as sessment process argue that it’s stacked in favor of big land lords, who can hire high-priced attorneys to appeal their as sessments. Though the attor neys usually succeed to varying

But Blackstone’s attorneys appealed the value in 2021, ar guing that the property was ac tually worth just $800 million. Though they didn’t succeed in slashing the property’s tax value by that much, they did get the value knocked down to $999 million on appeal. The up shot: Blackstone’s taxes jumped 29.4%—a hefty hike, but it could have been worse.

A spokesman for EQ Office, Blackstone’s office manage ment company, declined to comment.

Though critics of the coun ty’s property tax assessment

process contend big landlords don’t shoulder their share of the property tax burden, real estate investors say that raising property taxes on commercial buildings merely hurts the busi nesses that inhabit them. Why?

Office building owners typically don’t pay property taxes. They just pass along the expense to their tenants.

The unintended conse quence: By increasing overall occupancy costs, rising taxes only make it harder for land lords, and the city more gener ally, to retain and attract grow ing businesses, landlords say. It’s an argument they will con tinue to make long after they pay their taxes at the end of the month.

Former Chicagoan Ken Gri n and Gov. J.B. Pritzker are among the wealthy homeowners getting socked by massive property tax bills. Here’s a look at who joins them in the ranks of the city’s 10 biggest tabs.

This billionaire-owned mansion on Orchard Street receives the city’s second-highest residential property tax bill for a single owner, more than half a million dollars for the full tax year.

PROPERTY TAXES ROSE AT 24 OF THE 50 COMMERCIAL PROPERTIES IN CHICAGO WITH THE HIGHEST 2022 BILLS.

Willis Tower

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Dan Futrell

A decorated Airborne Ranger-quali ed infantry o cer with two tours in Iraq, Dan Futrell, 39, is CEO of Chicago’s Pat Tillman Foundation, a nonpro t that awards scholarships to veterans and their spouses and provides lifelong leadership development. Next year, he and a buddy will be featured in a documentary, "Black Box: Two Adventurers Search For Truth in 30-Year-Old High Altitude Plane Crash Mystery," about their expedition to Bolivia to locate the missing black box of Eastern Airlines Flight 980, which crashed in 1985. Futrell and his wife live in Wicker Park with their two children, ages 2 and 3 months. I By

Tell us about your early days.

My mother struggled with substance abuse and was in and out of jail. My father wasn’t in the picture, so I was in and out of foster care in Florida the rst six years of my life.

How did that a ect you?

Bernardine’s sel ess e orts drive my sense of obligation to serve.

Why did you enlist?

It was a way to help pay for school, nd adventure and gain independence.

Why Ranger School?

It was the hardest training I could sign up for. I wanted to test my mettle.

Worst day of training?

After weeks of getting two hours of sleep a night, we marched chest-deep in a Florida swamp at night, in freezing rain with 80 pounds on our backs.

After discharge?

I was awarded a Tillman scholarship to Harvard’s Kennedy School for a master’s in public policy. But more important than the money was being part of a community with shared experiences.

What inspired the Bolivia expedition?

I had an “aha” moment in 2015, when l was re ecting on what was important to me in life. I decided my life’s purpose was “ad venture, impact and connection.” When I came across an article in Wikipedia about the missing Bolivian ight recorder, I knew that would be my adventure. Till man is the impact and connection.

A terrifying moment?

One day when we were at 17,000 feet, the documentary director asked us to wear Go Pros and explore a cli face with a kilometersized hunk of ice hanging o of it. He and his crew didn’t want to get anywhere near it.

A turning point?

My mother kidnapped me from my grandparents’ house in San Diego and took me to Tempe, Ariz.

Luckily, my legally appoint ed guardian, Bernardine, contacted all 100 preschools in that area pre-internet, via snail mail, and found me.

What happened?

As we approached the cli , one of the guys yelled out “Avalanche!” I took o running faster than I have ever run, scrambling over huge boulders.

How bad was it?

The avalanche was quite small, but it got our hearts pounding.

Laura Bianchi

BMO strikes $40B community pact in bank buyout

BY STEVE DANIELS

e Canadian parent of BMO Harris Bank has struck a $40 bil lion community investment agree ment with a coalition of fair lending groups, likely clearing the way for approval of its acquisition of Califor nia’s Bank of the West.

e pact, announced Nov. 28, in cludes billions for lending and other investment in Illinois communities that are home to minorities and lowto moderate-income households, although BMO didn’t have a precise dollar gure for its home base in the U.S.

e deal was the culmination of months of negotiations with more than 80 groups, led by the National Community Reinvestment Coalition and the California Reinvestment Coalition.

e agreement in dollar terms is by far the largest such community reinvestment commitment Torontobased BMO Financial Group has made in its history. With federal banking regulators casting a more skeptical eye on bank consolidation under the Biden administration, executives have sought agreement with fair lending advocates who of ten are critical of banks to ease ap

proval of their deals.

e $40 billion pact comes just six months after Minneapolis-based U.S. Bank forged a $100 billion community bene ts agreement in connection with its acquisition of MUFG Union Bank, which federal regulators approved last month.

“We are committed to ongoing community engagement to realize the full potential of this plan,” BMO Harris CEO David Casper said in a news release.

Once completed, BMO’s $16 bil lion deal to buy Bank of the West from French parent BNP Paribas will transform Chicago-based BMO Harris from a large regional lender focused mainly on the Midwest to a super-regional with a major stake in California. BMO has targeted more than $16 billion of the $40 billion in the plan to California communities.

With Bank of the West added, BMO’s U.S. businesses would have a combined $413 billion in assets. BMO Harris Bank, which today has about $165 billion in assets, would total about $257 billion.

e ve-year community bene ts agreement includes a commitment of $7.5 billion in additional mort gage lending in disadvantaged and minority areas across BMO’s foot

print. Another $16.5 billion is going to small-business lending.

BMO has agreed to invest $17.5 billion over the ve-year term for community development, including contributions to community devel opment nancial institutions, which focus on lending to commercial and multifamily developers in disadvan taged communities.

e agreement will hike the amount BMO currently gives to Il linois CDFIs by 50%, the bank said.

Casper emphasized the plan’s po tential bene t to minority neighbor hoods, where more than 50% of the dollars pledged are slated to go. “We have a duty to continue addressing the barriers that disproportionately a ect people of color and remain committed to creating more oppor tunities that achieve progress for all,” he said in the release.

Jesse Van Tol, president and CEO of the Washington, D.C.-based Na tional Community Reinvestment Coalition, called the agreement “a big deal” in an interview.

His organization, which tends to take the lead in such discussions with bank executives after mergers are announced, met many times with BMO leadership, including Casper, over much of the last year.

e regulatory environment, he said, has made bank leaders more willing to engage with him.

“It’s speeding things up a little bit,” he said, referring to how quickly ex ecutives are willing to engage sub stantively on lending and bene ts deals. In addition, he said, banks in creasingly want to be seen as part of the solution to economic inequities.

“A lot of the companies are trying to brand themselves as purposedriven,” he said.

One key wild card in the discus sions was uncertainty about the im mediate economic future. With re cession looking more likely in 2023, meeting quanti ed lending com

mitments can become more risky for lenders.

In addition, sharply higher inter est rates over the past nine months is reducing demand for home purchases, which will complicate compliance with mortgage lending promises.

Enforcement of community ben e ts agreements can be tricky. By themselves, the pacts are voluntary. Often, they get incorporated into the regulatory orders when the deals are approved.

BMO has agreed to the appoint ment of a community advisory council, which will monitor compli ance, Van Tol said.

A FINGER JUST RA ISE A GL AS S

The plan, forged with more than 80 nonpro t groups, should ease federal approval of the deal combining California’s Bank of the West with Chicago’s BMO Harris

BLOOMBERG

Tower owner hit with massive foreclosure lawsuit

BY DANNY ECKER

e owner of a LaSalle Street o ce tower that lost its biggest tenant early in the COVID-19 pandemic is facing one of the largest foreclosure lawsuits in volving a downtown o ce build ing since the public health crisis began.

A venture of New York-based AmTrust Realty defaulted on its loan tied to the 983,000-squarefoot o ce building at 30 N. LaSal le St. by failing to make its August payment on its $165 million mort gage, according to a foreclosure complaint led earlier this month in Cook County Circuit Court.

e lawsuit, which lists at least $186 million in principal, interest and other fees owed, was led by an entity led by New York-based American General Life Insurance. e subsidiary of New York-based AIG issued the largest piece of the mortgage when AmTrust bought the tower in 2014, according to the lawsuit and Cook County records.

e complaint highlights the historic wave of nancial pain for properties along the vacancy-rid den thoroughfare, where the rise of remote work and weakened of ce demand during the pandem ic devastated landlords that were already grappling with an exodus of big banking tenants before it started.

Companies cutting back on workspace have pushed down town o ce vacancy to a record

high, sapping property values and leaving many investors with buildings that are now worth less than the debt tied to them. Rapidly rising interest rates this year have made it even hard er for owners to re nance their properties, prompting a number of downtown landlords to face foreclosure lawsuits or surrender their properties to lenders with out a ght.

DEPARTURE

AmTrust was already facing an uphill climb in 2019 when the city of Chicago said it would vacate more than 260,000 square feet at 30 N. LaSalle as part of a consol idation of some of its downtown o ces across the street at 2 N. LaSalle St. at departure left the building at roughly 62% leased as of last year, according to real estate information company Co Star Group, well below the 79% average for downtown o ces. e 43-story tower is about 50% leased today, according to CoStar.

AmTrust signaled its inten tion to revive the building a year ago when it announced plans to spend $100 million renovating several of its downtown o ce buildings to help compete for new tenants. A source familiar with 30 N. LaSalle said AmTrust began part of that work this year by building out move-in ready o ce spaces, or so-called spec suites.

But with lots of empty space,

high interest rates and precarious o ce demand, it’s likely AmTrust is underwater, meaning the tower is now worth less than the bal ance of its loan. e foreclosure ling by American General Life Insurance is a step toward seizing the property if it can’t reach an agreement with AmTrust to mod ify terms of its loan.

A spokesman for AmTrust did not provide a comment on the lawsuit. A Cook County judge Nov. 30 appointed Hilco Real Estate Vice President Mitch Vannemin as the receiver to oversee the property while the foreclosure complaint proceeds, court records show.

AmTrust took out the 2014 loan to nance its nearly $238 million acquisition of the building at 30 N. LaSalle. e tower was 86% leased at the time.

AmTrust tried to exit the Chi

cago o ce market entirely before the pandemic when it listed the entire downtown portfolio for sale in mid-2019, an o ering it hoped would fetch bids close to $1.3 billion as demand for down town o ce space soared. But the collection never traded, and the buildings’ value was hammered by softened demand during the public health crisis.

OTHER ASSETS

e 48-year-old building at 30 N. LaSalle isn’t AmTrust’s only local distressed asset. e rm earlier this year was negotiating a deal to surrender its 1.3 millionsquare-foot o ce tower at 135 S. LaSalle St. to its lender rather than face a likely lawsuit over a loan default, a move known as a deed in lieu of foreclosure, ac cording to a Bloomberg report tied to AmTrust’s $100 million

loan on the property. e build ing was left mostly vacant after the departure of Bank of Amer ica to a new namesake tower on Wacker Drive. e status of those deed-in-lieu negotiations is un clear.

While AmTrust sorts out its LaSalle Street issues, other land lords on the historic corridor are trying to do the same. e own er of a vintage 16-story o ce building at 19 S. LaSalle St. was recently hit with a $21 million foreclosure lawsuit, while similar lawsuits have been led involving the majority of an o ce tower just o LaSalle at 105 W. Adams St. and a block of o ces above the JW Marriott Chicago hotel at 208 S. LaSalle St.

e owners of two other big LaSalle Street o ce buildings at 10 S. LaSalle St. and 1 N. LaSalle St. also recently had their loans transferred to special servicers, typically a sign they are in dan ger of default. ose loans were packaged with other mortgag es and sold o to commercial mortgage-backed securities in vestors, making it more di cult for the borrowers to modify loan terms.

Mayor Lori Lightfoot is hoping some of the distressed LaSal le Street o ce buildings will be at least partially converted into apartments. With an eye on re storing foot tra c to the heart of the Loop, her administration recently rolled out a program of fering public subsidies to help nance such conversions if devel opers commit to making at least 30% of the units a ordable.

Wirtz family plans huge Lake County residential development

BY ALBY GALLUN

e Wirtz family is moving ahead with plans for a sprawling residential development on more than 700 acres of farmland it owns in unincorporated Lake County, an investment that predates not only the family’s acquisition of the Chicago Blackhawks but even the birth of ice hockey itself.

e family business, the Wirtz Corp., aims to develop Ivanhoe Farms northwest of Mundelein into a “farming-oriented residen tial community” that will include a mix of single-family homes, apart ments and other housing, along with retail, restaurants, o ce and other commercial space, compa ny Chairman Rocky Wirtz wrote in a memo to family members.

As a rst step, the Village of Mundelein will hold a hearing Dec. 12 to consider a proposal au thorizing the village to annex the property on Illinois Route 60, ac cording to a public notice posted Nov. 25 in the Daily Herald.

Called Ivanhoe Village, the project will transform the Wirtz dynasty’s oldest asset, a proper ty that has been in family hands for more than 160 years. Ivanhoe Farms was the original farm stead of Rocky Wirtz’s great-great grandfather, Michael Wirtz, who emigrated from Germany and settled in the area in the 1850s.

PROPOSAL

e proposed development could encompass as many as 2,000 homes, according to a Wirtz spokesman.

“Residents will be able to enjoy a pedestrian-friendly, health sus taining, and convenient lifestyle unlike any other community in the region,” Rocky Wirtz wrote in the memo. “ is 25-year project will thoughtfully develop more than 700 acres that surround Ivanhoe Farms and will put the land to good use in harmony with our farmstead and the surrounding community.”

e property is part of a Wirtz business empire that includes the

Chicago Blackhawks—acquired by Rocky Wirtz’s grandfather, Arthur Wirtz, in the 1950s—the United Center, two banks and Breakthru Beverage Group, a major alcohol wholesaler. In addi tion to Ivanhoe Farms, the rm’s real estate holdings include a downtown o ce building and apartments on Chicago’s North Side. e family is in the process of selling an Evanston apartment portfolio for $35 million.

e Lake County property in cludes a working farm and nurs

ery that stretches north from Route 60 up to West Peterson Road. e property also includes some land on the south side of Route 60. Developers have been active in the area: Pulte Homes is building a 187-unit single-family home development called Shel don Woods just down the road. And Alter Group is building a 641-acre industrial development next door to the Wirtz property.

But the supply of new hous ing in Lake County isn’t keeping up with demand, said Erik Do

ersching, president and CEO of Tracy Cross & Associates, a Scha umburg-based housing consult ing rm. at could bode well for a major project on the Ivanhoe Farms site. “A properly positioned master-planned community with a really solid hierarchy of product would really help the supply issue there,” Doersching said.

With 2,000 units, Ivanhoe Vil lage “would be one of the larger master-planned communities in the region,” he said. “ ere’s not many of that scale—it’s hard to put together that much acreage.” e development would in clude lots of housing, and much more.

“If approved, Ivanhoe Village development will include a di verse mix of single-family homes, townhomes, multifamily rental and age-targeted residences,” Rocky Wirtz wrote in his memo. “ e mixed-use Village Center will include a vibrant mix of retail, restaurants, tness, and o ce space centered around a village square. On the northern edge, commercial buildings with o ce, medical o ce, recreation, and in dustrial spaces will be developed that are within walking distance to community residents.”

The owners of the Chicago Blackhawks want to build as many as 2,000 homes on a farm that has been in the family’s hands since before the Civil War

The building at 30 N. LaSalle adds to the historic wave of distress on the vacancy-ridden corridor

30 N. LaSalle St.

Ivanhoe Farms

ALBY

GALLUN

GOOGLE

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With City Hall up for grabs, the business community must start speaking up now

This is, in many ways, an extraordi nary moment in Chicago political history.

For the rst time in living mem ory, the Chicago City Council and, per haps, the mayoralty itself are in a very real state of ux. On the council side, the change has been taking place in slow mo tion over the past year as a raft of aldermen retire or, in some cases, head for the exits in light of legal troubles, creating openings for newcomers. And very real battles are shaping up for control of a swath of alder manic seats, making the eventual ideolog ical composition of the full council after February’s election more di cult than usual to predict.

Meanwhile, the mayor’s race has shaped up to be a scrum, as 11 candidates vie for Mayor Lori Lightfoot’s job. As Crain’s Greg Hinz and Justin Laurence explained just after the Nov. 28 deadline for candidate lings, what’s remarkable is the fact that none of these mayoral contenders is con sidered a front-runner, and none seems likely to win the 50%-plus-one vote neces sary in February to avoid an April runo .

In the midst of all this churn are signs that the overall makeup of the City Council and the mayoral team on the Fifth Floor could very well be drifting in a direction that fa vors progressive candidates—and that drift is worrisome for a Chicago business community eager for viable answers to the problems that plague the local economy.

Chicago needs elected leaders who un derstand that public safety, fair taxation, balanced budgets, clean and e cient pub lic transit, intelligent neighborhood devel opment, top- ight schools and a vibrant downtown are crucial to this city’s future as the business capital of the Midwest. But with candidates backed by unions—and with progressive activists mobilizing to

increase their in uence at City Hall and talking up ideas like a $25 minimum wage, higher taxes on high-end home sales and the so-called LaSalle Street tax on nancial transactions—the business community’s priorities could very well take a back seat

to other concerns.

Business leaders who have stayed out of the mayoral race have been fairly quiet so far. But, as Hinz and Laurence report, there are signs the city’s business leadership is recognizing the need to get more involved

in shaping the race. Mike Ruemmler, a con sultant who managed then-Mayor Rahm Emanuel’s successful 2015 re-election campaign, is putting together a political committee along with consultant Ron Holmes that will make independent ex penditures on behalf of some candidates for alderman. And nancial exec Michael Sacks con rmed to Crain’s that he will support the new group nancially.

It’s high time the city’s business leaders started taking a more active role in shaping the civic conversation as February’s elec tions loom. With Chicago’s global reputa tion on the line, there’s too much at stake for Chicago’s CEOs, entrepreneurs and civic leaders to stay on the sidelines in this election season.

Candidates for every local o ce— particularly for the mayor’s seat—must face tough questions about what they will do to make Chicago a better place to build busi nesses and, in turn, to build livelihoods. None of the priorities that progressive can didates hold dear are achievable without a healthy economy, a scally responsible government, and the jobs and wealth that come with each. If the current crop of can didates vying for o ce won’t argue for these values, then the business community must.

It’s a critical time to boost students’ STEM skills

Crain’s Equity recently ad dressed the challenge of pan demic learning loss among Chicago Public Schools students, particularly those from underresourced, disadvantaged neighbor hoods. e sudden shift to remote learning in March 2020 revealed weaknesses and inequities that have long plagued education systems but have been especially prevalent and obvious in the past couple of years, according to the article.

Then, on Oct. 24, the “Nation’s Report Card” was released, show ing the largest decrease ever in national math and reading scores,

reiterating concerns about historic educational setbacks brought on by the pandemic.

There’s widespread concern that if schools don’t implement high-quality interventions and sup port programs, students, esp ecially those from minority groups and low-income areas, they will not re gain what they lost. This will result in lower high school graduation rates and a decline in young people pursuing college or skills-based job training for years to come.

Crain’s pointed to the hurdle of ensuring students are armed with the STEM skills they will need to

find meaningful and sustainable employment in a job market that is increasingly tech- and sciencefoc used. I applaud Crain’s for draw ing awareness to these very real and complex problems we are facing.

STRATEGIES

As someone who cares deeply about education, I’m glad to see CPS leaders implementing a ThreeYear Blueprint with strategies for targeting racial injustice, economic inequality and the pandemic’s academic impact. I’m also pleased Crain’s mentioned one initiative that will help re-engage students:

the CPS strategic partnership with Mad Science of Chicago.

This academic year, qualifying CPS elementary schools can offer hands-on Mad Science STEM work shops on-site before, during or af ter school. The programs, funded by the Chicago Board of Educa tion, foc us on supporting schools’ academic efforts to provide a well-rounded foundation for a life long love of science, technology, engineering and math so we can truly inspire students to pursue fu ture STEM careers.

Children are inherently curious, and science is a toolbox of discov

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.

Opinion page

chicagobusiness.com. Please include a phone number for veri cation purposes, and limit submissions to 425 words or fewer.

Sharon King is vice president of research and development and franchise operations at Mad Science.

WITH CHICAGO’S GLOBAL REPUTATION ON THE LINE, THERE’S TOO MUCH AT STAKE FOR CHICAGO’S CEOS, ENTREPRENEURS AND C IVIC LEADERS TO STAY ON THE SIDELINES IN THIS ELECTION SEASON.

ery that provides a pathway for them to channel that curiosity. When they are exposed to supplemental learning oppor tunities about gravity, energy, weather or planets, to name a few STEM topics, in a manner that is fun and in teresting, they are gaining foundational science knowledge that is essential to becoming an informed and productive citizen on the planet. In addition, they are acquiring critical thinking skills that will serve them well no matter what career they choose in life.

Experiential learning opportunities for children are particularly important at this moment in time. STEM oppor tunities that focus on learning by doing

CRAIN’S

can help students regain lost knowledge, expose them to new concepts and focus on deepening practice skills they might have missed during the pandemic.

This is particularly helpful to students in underserved areas that have limited or no access to STEM enrichment oppor tunities. Students in these communities can greatly benefit from building a pos itive emotional connection to learning physics, chemistry or biology, and from envisioning themselves as scientists or simply as learners who are curious about the world around them.

This is a valuable opportunity for Chi cago elementary students—especially at this critical time in education.

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CRAIN'S LIST

LARGEST CANNABIS COMPANIES

CRESCO LABS 400 W. Erie St., Chicago60654 CrescoLabs.com

PHARMACANN 190 S. LaSalle St., Chicago60603 PharmaCann.com

GREEN THUMB INDUSTRIES 325 W. Huron St., Chicago60654 GTIGrows.com

VERANO 415 N. Dearborn St., Chicago60654 Verano.com

CURALEAF 344 N. Ogden Ave., Chicago60607 Curaleaf.com

CharlesBachtell CEO 1,150 3,000 Sunnyside 6 2 Chicago 2013 10 $821.7

BrettNovey CEO 472 3,100 Verilife 8 1 Chicago 2014 8 $250.7

BenKovler CEO 450 3,000 Rise 6 2 Chicago 2014 15 $893.6

GeorgeArchos Chairman, CEO 430 3,881 Zen Leaf 10 1 Chicago 2014 14 $738.0

MattDarin CEO 400 5,750 Curaleaf 1 1 Wake eld, Mass. 2010 21 $1,210.0

KathleenOlivastro Regional vice president 165 2,040 Ascend 4 1 New York 2018 6 $332.4 7

ASCEND WELLNESS 9820 S. Ridgeland Ave., Chicago Ridge 60415 AWHoldings.com

ACREAGE HOLDINGS 975 Rohlwing Road, Rolling Meadows60008 AcreageHoldings.com

KateNelson Senior vice president, Midwest and Northeast regions

161 1,090 Nature’s Care 2 1 New York 2011 8 $188.9 8

4FRONT VENTURES 8554 S. Commercial Ave., Chicago60617 MissionDispensaries.com

GabrielMendoza Executive vice president, retail operations BrandonMills President, Massachusetts and Illinois

150 600 Mission 2 2 Phoenix 2011 5 $104.6 9

COLUMBIA CAREINC. 1 4758 N. Milwaukee Ave., Chicago60630 Columbia.Care

NicholasVita CEO 140 e 2,564 2 Cannabist 2 1 New York 2012 18 $460.1 10

WINDY CITY CANNABIS 444 N. Michigan Ave., Chicago60611 WindyCityCannabis.com

StevenWeisman CEO PerrineKnight Chief operating o cer

120 150 Windy City Cannabis 4 0 Chicago 2014 1

REVOLUTION CANNABIS 1200 N. Branch St., Chicago60642 RevCanna.com

MEDMEN 1142 Lake St., Oak Park60301 MedMen.com

CraigJohnson CEO DustyShroyer President

BobFitzsimmons Chairman, CEO 17 100 nuEra 2 0 Chicago 2015 1

50 450 Enlightened 2 1 Chicago 2014 5 12 NUERA 1308 W. North Ave., Chicago60642 nuEraCannabis.com

EdwardRecord CEO 14 525 MedMen 1 0 Culver City, Calif. 2010 7 $145.1

BY SOPHIE RODGERS

Chicago is home to a few of the cannabis industry’s leading players, including publicly traded Cresco Labs, Verano and Green umb Industries, and privately held PharmaCann. ey dominate Crain's new list of Chicago’s Largest Cannabis Companies. And they also ranked high on this year’s Fast 50, which recognizes the city’s fastest-growing companies.

Since Illinois' legalization of recreational cannabis use in 2019 (with retail sales beginning Jan. 1, 2020), it’s no surprise Chicago’s cannabis companies have seen meteoric growth. In 2021, there was a total of $1.38 billion in Illinois adult-use cannabis sales—a 106.1% increase from 2020.

Crain’s inaugural list, ranked by number of local employees,

includes both regionally headquartered companies and out-oftowners with a presence in the greater Chicago area. No. 1 on our list—and homegrown in Chicago—is Cresco Labs with 1,150 full-time employees in the metro area. e company has six dispensaries in the Chicago area doing business as Sunnyside and two cultivation centers in Illinois. With operations in 10 states, Cresco Labs generated $821.7 million in 2021.

e second, third and fourth rankings go to Chicago-based PharmaCann, Green umb Industries and Verano, respectively. ese three companies each have over 400 employees in the metro area.

Verano operates the most local retail locations on this list: 10 dispensaries branded as Zen Leaf. With operations in 14 states, Ver-

ano also has the greatest number of companywide employees of all the Chicago-based establishments on our list—3,881 employees total.

Wake eld, Mass.-based Curaleaf, No. 5 on the list, has the greatest presence in Chicago of all the out-of-towners with 400 local employees. e company has one namesake dispensary in the area and one cultivation center in Illinois.

Next year’s list may see new players and a shake-up in rankings since Illinois awarded 192 new retail licenses this year. However, Cresco Labs will likely maintain its No. 1 place, especially if the company completes its pending acquisition of New York-based Columbia Care, which currently ranks No. 9 on our list.

Want to dig deeper into our data? For employment and revenue gures, become a Crain's Data Member and head to our Data Center at ChicagoBusiness. com.

Chicago is home to some of the industry’s leading players, and they dominate our roundup of key rms in the sector

Bottles of recreational marijuana sit on a counter at a Cresco Labs dispensary in Chicago on Jan. 1, 2020, when legalized sales of recreational pot began in Illinois.

The wild ride for weed companies isn’t over

retailers, consultants and

Marijuana companies have ex perienced far more harsh than mellow this year.

Weed stocks dropped twice as fast as the overall market. Sales growth has slowed as customers feel the pinch of in ation. New markets in Illinois, New Jersey and New York are opening more slowly than expected. e cost of borrow ing is up 50% because of rising in terest rates.

e industry is holding out hope for help from Washington in easing nancial restrictions. A bill called the SAFE Banking Act would make capital more available and reduce costs. But it’s not clear what form weed legislation will take, or if it will make the cut in the lame-duck priorities of Congress.

“We’re in a hard place right now,” says Je Wissink, who runs the cannabis and consumer products advisory practice at CohnReznick, an accounting and consulting rm.

Chicago remains the center of Big Weed, home to three of the ve largest publicly traded marijuana companies. Cresco Labs is poised to leapfrog its competitors early next year if it completes the acqui sition of New York-based rival Co lumbia Care in a $2 billion deal.

Green umb Industries re mains the darling of investors. Its shares are down 43% this year to about $13 per share, compared with a 41% drop in the index of U.S. weed companies compiled by New Cannabis Ventures. Stock prices of Cresco and Verano Holdings, which is the other Chicago-based public cannabis company, are down 50% and 58%, respectively.

Illinois recreational-marijuana sales have plateaued at about $130 million per month amid a delay in opening new stores, along with the impact of in ation on consumers’ wallets. It’s among the factors in sluggish sales for the big players.

e biggest marijuana compa nies—such as GTI, Cresco, Verano and privately held PharmaCann— already have the maximum num ber of stores allowed in Illinois. But they’re also wholesalers who are counting on new stores to buy their products.

After lotteries and litigation, Illi nois awarded 192 new retail licens es, which will add to the limited pool of 110 shops that previously opened. So far, only two of those new stores have opened. Although more are expected to open in the year ahead, Illinois has some catching up to do.

Michigan, which began recre ational sales at roughly the same time as Illinois, has issued new licenses much faster, with 578 dis pensary permits issued through October. Michigan’s sales were $194.4 million in October, 48% more than the $131.5 million re corded in Illinois.

e slow rollout in Illinois has had one bene t, however. Prices are holding up better than in oth er states. Retail marijuana prices in Michigan have plunged 73% in the

past year to $110 per ounce, com pared with about $445 per ounce in Illinois.

Stable prices won’t help new en trants if they can’t raise money to build out dispensaries. e funding environment for marijuana com panies has deteriorated, with inter est rates rising from 8% two years ago to the low to mid-teens.  e state of Illinois has yet to open a forgivable-loan program to dispen sary licensees.

“Every one-point increase in in terest rates on a $1 million loan is $1,000 a month,” says Beau Whit ney, who heads Whitney Econom ics, which focuses on the cannabis market. “Most loans are a couple million, so it’s $2,000 a month. It adds up quick.”

e large public companies will survive, as will smaller, established second-tier operators, Wissink says.

“Access to capital is a huge con straint,” he says. “Everyone is bat tening down the hatches. You’re hearing talk about restructuring. Without legislation or loosening of capital markets, there will be a sig ni cant number of companies that don’t survive this.”

e amount of money raised by cannabis companies through Nov. 11 was down 64% to $4 billion, ac cording to Veridian Capital Advis ers.

“We are laser-focused on cash generation,” Dennis Olis, Cresco’s chief nancial o cer, said during a Nov. 15 earnings call.

Verano Holdings recently ter minated a $413 million acquisi tion that would have given it access to the New York and Minnesota markets.

“We decided to strategically de lay (capital expenditure) projects that we do not believe will provide immediate-term returns as we balance short-term return on in vestment with long-term growth opportunity,” CEO George Archos told analysts on a Nov. 14 earnings call.  “At this time, we prefer to hold cash on the balance sheet to pro vide exibility.”

e companies most at risk are new entrants, particularly minori ty-owned businesses that are the focus of social-equity e orts in Il linois, New Jersey and New York.

Many in the industry see the dif culties for social-equity entrants to raise money as a motivator for members of the U.S. Senate who previously had been holding out for legalization. Capital constraints could make legislation called SAFE-Plus, which would encour age banks to o er lending and oth er services to cannabis companies and possibly allow SBA loans, more palatable.

“We've never been closer to achieving reform than we are right now,” Cresco CEO Charlie Bachtell told analysts Nov. 15. “What does happen here between now and the end of December could have a ma terial impact on what the next cou ple of years look like in this space.”

Banking legislation could open the door for cannabis companies such as Cresco to be listed on U.S. stock exchanges, giving pot stocks a much broader investor base and boosting share prices.

Democrats have a limited win dow to pass legislation before los ing their congressional majority. It’s not clear that cannabis will be a top priority, especially with a looming ght over the federal debt limit that could lead to a govern ment shutdown.

“If SAFE doesn’t happen now, when is the next catalyst? I feel like it’s several years away,” says Alex ander Gastevich, vice president of V. Gastevich Investments in Chi cago, which owns shares of several cannabis companies. “I think it’s now or never.”

Cannabis producers,

more have endured a white-knuckle ride on the roller coaster of plunging markets, soaring interest rates, and shifting state and local political winds. Don’t unbuckle the seat belts yet. | BY JOHN PLETZ

Major milestone for a Northwestern tech spinoff

BY JOHN PLETZ

NanoGraf, a battery-technology company that spun out of a North western University research lab a decade ago, is launching a factory in Chicago to supply the U.S. mil itary.

e company has been working for several years to perfect its tech nology, which improves the per formance of lithium-ion batteries used to power everything from phones to electric vehicles.

NanoGraf has won a $10 million contract from the U.S. Department of Defense to supply components over the next 18 months to compa nies that make batteries and oth er equipment, such as radios and night-vision goggles.

“Soldiers carry 100 pounds of gear; 25 pounds are just bat teries,” says Chip Breitenkamp, NanoGraf’s president.

NanoGraf has leased a 17,000-square-foot facility west of Fulton Market at 400 N. Noble St., which will house its o ces and production operations. e com pany will double its sta to about 35 people.

It’s a major milestone for NanoGraf, which launched as SiNode Systems in 2012, based on work by Northwestern Univer sity professor Harold Kung. It was co-founded by Samir Mayekar, who left in 2019 to become Chi cago’s deputy mayor and now is chairman of the board.

DIFFERENT APPROACH

NanoGraf came up with a di er ent approach to making anodes, the part of a battery that holds a charge. Most anodes are made of graphite. NanoGraf added silicon, which improves the battery’s ca pacity to hold a charge by about 20%.

e company produces the an ode material, and a contract man ufacturing partner assembles the nal batteries. NanoGraf has been making products in small quanti ties in Japan since 2018. Now it’s moving production back to the U.S.

e company plans to triple production to about 35 tons of an ode material next year, or enough to make about 20 million standard rechargeable battery cells that are

about the size of a AA battery. It expects to increase output to 50 tons in 2024.

NanoGraf’s move is important for two reasons: It’s part of the reshoring trend, or moving pro duction of critical technical prod ucts back to the U.S. It’s also an example of how Chicago can carve out a place in the massive technol ogy shift that’s transforming the auto industry. Argonne National Laboratory, which worked early on with NanoGraf, is home to a major federal government battery research program.

“For anyone who cares about the science and tech ecosystem, we’ve always talked about latent potential of our research labs and universities to create hard-science companies. Here is one example,” says Brad Henderson, CEO of P33, a civic group that promotes the city’s tech economy. “It’s hard, but they’ve got a shot. It’s a long shot, but it’s one of our best shots.”

NanoGraf claims the lithiumion batteries made using its com ponents have the highest energy density achieved so far. It also overcame several key technical

challenge related to using silicon.  “ e reason the Department of Defense wants these cells is they can’t buy them anywhere else,” says Je Chamberlain, CEO of Volta Energy Technologies, a Warrenville-based venture fund that recently invested in NanoGraf. “As a venture investor, that’s music to your ears. It’s hard to develop a new material. It’s even harder if you want to manufacture it.”

FAST-GROWING MARKETS

Longer term, NanoGraf wants to pursue the fast-growing markets for consumer electronics and elec tric vehicles. Breitenkamp says 13

customers have tested its battery cells, about half make devices for the military, along with consumer electronics companies and some in the electric-vehicle space. Start ups from coast to coast are chas ing the opportunity, promising their own innovation.

“Everybody wishes we had an alternative to the standard lithium-ion battery,” said George Crabtree, who leads the Joint Center for Energy Storage Re search at Argonne. “Is it enough to be better than the current lith ium ion, to displace it? That’s a hard question . . . because it’s got to be a lot better.”

Tax Changes in 2023: What Individuals and Businesses Can Expect

ough the In ation Reduction Act of 2022 provided individuals with new and expanded credits, taxpayers could face new legislation in 2023 while coping with rising interest rates and in ation. With proactive planning, there are several ways for individuals to reduce their taxable income.

MAKE RETIREMENT CONTRIBUTIONS

KATHY GARLOW Partner

kgarlow@citrincooperman.com

Generally, taxpayers realize an immediate tax bene t while the investments grow tax free until retirement. e 401(k) deferral will increase from $20,500 in 2022 to $22,500 in 2023. e catch-up contribution for taxpayers aged 50 or older will increase from $6,500 to $7,500 in 2023. Individual Retirement Account (IRA) contributions will increase from $6,000 to $6,500 in 2023 with the catch-up for taxpayers aged 50 or older remaining at an additional $1,000.

Some may consider front-loading their expenses in 2023 to take advantage of itemized deductions.

CHARITABLE CONTRIBUTION PLANNING

Taxpayers can strategize charitable deductions with the use of a donoradvised fund. For example, a single taxpayer who normally donates $4,000 per year could pay and deduct $12,000 to a donor advised fund in year one. e taxpayer would then take the standard deduction in years two and three, advising the fund to disburse to various charities over all three years. Taxpayers are limited on charitable deductions based on their adjusted gross income with excess deductions generally carried over to future years.

CONTRIBUTE APPRECIATED SECURITIES

QUALIFIED CHARITABLE DISTRIBUTIONS FROM IRAS

A taxpayer aged 70 ½ or older can make a distribution from their IRA up to $100,000 directly from their IRA to a qualifying charity and have it count towards their required minimum distribution. e amount donated to charity is not included in the taxpayer’s adjusted gross income.

CONSIDERATIONS FOR BUSINESSES

ere are many provisions in the tax law called “tax extenders” that have expired or are set to expire at the end of 2022. Many of these laws have bipartisan support to extend their application, but it is uncertain whether any laws will be passed by the end of 2022.

higher depreciation deductions. If you wait until 2023, only 80% of the asset’s costs can be deducted as bonus depreciation.

It is di cult to predict what will happen in 2023 and whether the changes will be retroactive or prospective. Citrin Cooperman’s tax professionals are prepared to help you plan and respond to tax changes made by Congress as they develop. Reach out to Kathy Garlow at kgarlow@ citrincooperman.com or Daniel Jaszka at djaszka@citrincooperman.com to discuss these tax changes.

DANIEL JASZKA Partner

djaszka@citrincooperman.com

TIMING ITEMIZED DEDUCTIONS

In 2023 the standard deduction will be $27,700 for married ling joint taxpayers and $13,850 for single lers. With the state and local tax deduction limited to $10,000, many taxpayers use mortgage interest expense and/or charitable contributions to push them over the standard deduction amounts.

When taxpayers donate appreciated securities, they bene t by receiving a charitable deduction for the fair market value of the gi and they also do not pay capital gains tax on the appreciation.

It’s nally here! Citrin Cooperman is excited to announce the launch of our new website—bringing you an innovative, industry-focused experience with exclusive content tailored to your needs. Access the future today at citrincooperman.com.

As part of the Tax Cuts and Jobs Act, the 100% bonus depreciation of quali ed property is dropping to 80% for assets placed in service a er 2022. It may be bene cial to purchase and place in service assets before the end of 2022 to take advantage of the

“Citrin Cooperman” is the brand under which Citrin Cooperman & Company LLP, a licensed independent CPA rm, and Citrin Cooperman Advisors LLC serve clients’ business needs. e two rms operate as separate legal entities in an alternative practice structure. Citrin Cooperman is an independent member of Moore North America, which is itself a regional member of Moore Global Network Limited.

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CONTRIBUTING AUTHORS

With a military contract and plans for a West Loop factory, NanoGraf shows how Chicago can carve out a place in the lithium-ion battery industry

Facing revenue gap, Howard Brown is considering layoffs

Like other health care providers, the clinic system is confronting drops in pharmacy revenue and federal COVID relief funding, adding up to millions of dollars

BY KATHERINE DAVIS

Howard Brown Health is mull ing layo s as it faces intense nan cial challenges presented by drops in pharmacy revenue and federal COVID-19 relief funding.

e health care provider with a focus on the LGBTQ+ community, said in a statement it is considering cutting sta as it works to close a $12 million revenue gap this year, but did not specify how many work ers could be impacted.

Howard Brown, which has 714 employees, said any potential lay o s won’t occur this year, but it provided no other information on how soon into 2023 cuts might be instituted.

Howard Brown said it is also exploring other cost-cutting mea sures, including strategies to boost revenue generated from medical visits and implementing a new electronic medical record to help streamline operations.

“We have a commitment to qual ity, culturally compassionate health care, and we have no intention of eliminating services,” Howard Brown spokesman Erik Roldan said in a statement to Crain’s.

Founded in 1974, Howard Brown provides health care pri marily to LGBTQ+ patients across 10 clinics in Chicago and serves more than 40,000 adults every year. According to its website, the system has an annual budget of more than $145 million.

Talk of layo s comes just months after hundreds of Howard Brown employees voted to join the health system’s existing nurses union, which is represented by the Il linois Nurses Association. With the move, the union began repre senting about 490 Howard Brown, Broadway Youth Center and Brown Elephant workers, which include patient support sta , social work and behavioral health teams, retail workers and some administrative professionals.

If Howard Brown does institute layo s, it says it will bargain with the union rst and in good faith.

Howard Brown’s public state ment about the layo s on Nov.

23 came after the organization privately presented its unionized workers with a “voluntary sepa ration” proposal on Nov. 19, with a second enhanced proposal on Nov. 22, Roldan said. Such pro posals are often the  rst step or ganizations take to reduce sta before instituting layo s.

More than 80 job titles were identi ed as eligible for the vol untary separation program, which asks for some employees to volunteer to leave their jobs, according to documents obtained by Crain’s. Roles included impact case managers, health coordina tors, project managers and wom en’s health specialists at Howard Brown’s facilities across the city. e proposal detailed that work ers who chose to leave Howard Brown would receive one week’s salary per year of service, with a minimum of two weeks, as well as health care bene ts through the end of January, and no challenge to unemployment claims, Roldan said in a statement.

Margo Gislain, an Illinois Nurs es Association representative who is the lead organizer for Howard Brown’s union, said the union op posed the voluntary separation proposal, claiming leadership has not been transparent about why terminating sta is required.

“I don’t believe that they don’t have the money because they hav en’t proven it,” Gislain said. “I think that these layo s are optional and they don’t want to cut other things.”

As of Nov. 28, Howard Brown had not formally issued a voluntary sep aration o er to union-represented sta but was rolling one out that day to non-union sta , Roldan said. Additionally, Howard Brown said it is holding a companywide sta meeting to provide employees with information and to answer questions.

It is a tumultuous time for hospi tals and other health care providers in Chicago and across the coun try. In ation is driving up provid ers’ costs at the same time federal COVID relief money that helped them get through the worst of the pandemic runs out.

Claire’s opens stores inside Macy’s

The Ho man Estates-based company is using the shop-in-shop model to help

it transition away from its legacy as a mall-based retailer

BY ALLY MAROTTI

Claire’s is partnering with Macy’s to open 20 of its fashion and accessories shops within the department stores, including the Macy’s at Oakbrook Center.

e shop-within-a-shop con cept is gaining popularity among niche retailers as they try to reach broader audiences without build ing out full storefronts. For exam ple, Bolingbrook-based retailer Ulta Beauty is opening 800 such concepts inside Target locations.

For Ho man Estates-based Claire’s, opening stores inside of Macy’s is a chance to diversify its retail footprint and reach new and existing customers in more places, as it moves away from its legacy as a mall-based retailer.

“We are combining our brand power to reach new customers and serve them with the latest on-trend accessories in time for the holiday shopping season and beyond,” Claire’s CEO Ryan Vero said in a news release.

e 20 Claire’s within Macy’s were open as of mid-November,

a spokesperson said. ere are eight agships in Macy’s loca tions in New York City, Los Ange les, Miami, Atlanta and Honolulu, along with additional locations in Orlando, Fla., Las Vegas, Oak Brook and more. e companies have not disclosed plans to open additional shops within shops.

Macy’s is “thrilled” to expand its jewelry and accessories o er ings through the partnership with Claire’s, the department store’s senior vice president of merchan dising said in the news release.

Claire’s, which mainly targets teens and younger consumers, has operated for more than 50 years selling jewelry, accesso ries and cosmetics and o ering its core ear piercing service. e company once rooted in shop ping malls is using merchandising partnerships to help transform itself. Claire’s also has shops in more than 360 Walmart locations. Beyond that, it has franchised lo cations and partner retailers such as Walmart, CVS and Toys “R” Us that also sell its products.

The Howard Brown Health Center in the Rogers Park neighborhood.

ALAMY BLOOMBERG

Constitutional brawl creates opening for Fifth Third

A bombshell appellate court ruling that imperils the future of the Consumer Financial Protection Bureau comes at a convenient time for the bank, which is ghting a lawsuit that alleges predatory practices reminiscent of the Wells Fargo debacle

BY STEVE DANIELS

A recent federal appeals court ruling that declares the Consum er Financial Protection Bureau constitutionally illegitimate has given Fifth ird Bank another weapon to defend against a fed eral lawsuit accusing the bank of preying on consumers.

e bombshell ruling from the 5th U.S. Circuit Court of Appeals, handed down in October, threat ens the continued existence of the principal federal agency created to protect consumers from nan cial fraud and maltreatment. And it presents the latest wrinkle in a no-holds-barred legal war over Fifth ird’s past behavior toward consumers. e CFPB alleges in court that Fifth ird employees opened accounts without con sumer permission between 2010 and 2016 in order to meet growth goals set by corporate brass.

Much of that, by Fifth ird’s admission, took place in the Chicago market, where the Cincinnati-based bank was struggling to compete.

Fifth ird’s position in the case is that the infractions were limited and were uncovered by the bank and freely reported to regulators. e CFPB’s position is that Fifth ird was and is dra matically understating the extent of the unauthorized accounts and associated charges. Memo ries remain fresh of the fake-ac counts scandal around the

same time at Wells Fargo, which badly tarnished the San Fran cisco-based bank’s reputation, exacted billions in penalties and subjected it to regulatory limits on its growth.

e 5th Circuit’s October rul ing threatening the constitu tionality of the CFPB, however, creates an opportunity that Fifth ird is seizing upon. In a brief led Nov. 14, Fifth ird asked a federal judge in Cincinnati to permit it to amend its defenses by adding the arguments out lined by the appeals court. e CFPB is opposing the request, Fifth ird noted in its brief.

Fifth ird has vowed to take the matter to a jury if it goes that far.

OTHER LITIGATION

Whether it goes that far could well depend on the outcome of separate litigation challenging the CFPB’s legitimacy. Conserva tives who opposed the agency’s establishment in the aftermath of the Great Recession have point ed to its unusual structure. In order to insulate the agency from pressure by nancial interests, Congress barred the president from removing the CFPB director at will, a provision the U.S. Su preme Court invalidated in 2020 while preserving the rest of the agency’s structure.

e 5th Circuit ruled last month that funding for the CFPB, which comes from the Feder al Reserve and therefore isn’t

controlled by Congress, violated the appropriations clause of the Constitution, an inappropriate abdication of power by Congress, which has the power of the purse.

e CFPB on Nov. 15 appealed to the U.S. Supreme Court.

“Recently developed case law has put a spotlight on the con stitutionality of the bureau’s structure based on its unusual funding mechanism,” Fifth ird wrote in its brief.

e bank argued that it should be allowed to add this argu ment to its many other defenses.

“Since ling its amended answer, the legal landscape has shifted,”

the bank wrote.

“On Oct. 31, 2022, Fifth ird asked the bureau whether it would consent to the proposed amendment,” the bank added.

“ e bureau informed Fifth ird on November 8, 2022, that it would not consent.”

A lawyer for the CFPB didn’t respond to a request for com ment.

CHALLENGES

Fifth ird isn’t the only nan cial player seizing on the ruling to defend against CFPB enforce ment actions. In requesting Su preme Court review, the CFPB

noted, “Defendants in several CFPB enforcement cases have already sought dismissal or sim ilar relief based on the decision” and “[n]ew challenges to the bureau’s rules and other actions can be expected to multiply in the weeks and months to come, and will presumably be led in the Fifth Circuit whenever possi ble,” according to a summary of the agency’s petition by law rm Ballard Spahr.

e 5th Circuit handles appeals from federal court districts in Louisiana, Mississippi and Texas and is viewed as the most conser vative circuit in the country.

A worrying sign about how inflation is hitting consumers

BY STEVE DANIELS

You’d have to go back, perhaps, to the early days of the Discover Card in the 1980s and early 1990s to nd a time when loans on the card grew by 20% in a year.

But that’s exactly the growth rate Riverwoods-based Discover Financial Services posted for the year that ended Oct. 31 when it led its latest credit card statistics last month.

Normally, that would be cause for celebration. Discover’s credit card business model is predicat ed on customers paying interest on their card purchases rather than paying o balances in their entirety each month.

Now, though, with in ation im posing nancial stress on more U.S. households and the voic es predicting recession growing louder and more insistent, people piling more debt on their credit cards could be cause for concern.

Discover isn’t alone in this phenomenon. Virtually every major card issuer is seeing card loan growth at 20% or higher.

at includes McLean, Va.-based Capital One and New York-based American Express.

So far, executives say they’re seeing little evidence of major consumers struggling to stay cur rent on their cards.

“Our strong results re ect our continued disciplined approach to credit management,” Discover spokesman Robert Weiss said in an email. “Our solid execution positions us well for a range of fu ture economic environments. We are not seeing evidence of emerg ing credit stress beyond expected normalization. Delinquencies among our lower prime segment are normalizing, but in upper prime delinquencies and chargeo s remain below pre-pandemic level.”

‘NORMALIZATION’

For Discover, net charge-o s on the card ticked up in October to an annualized level of 2.1% from 2.01% the month before. Delinquencies longer than 30 days came in at 2.23%, up from 2.11% the month before.

e credit card industry refers to this as “normalization.” Sour loans are slowly creeping up to normal levels from what were un usually benign conditions as con sumer savings rates soared in the aftermath of a series of pandem ic-related relief packages enacted in Washington, D.C.

Now, with those savings rates falling and in ation still rampant, more consumers appear to be leaning on their credit cards to cover basic expenses. If job losses pick up, as they are beginning to do in certain industries like tech nology, issuers could put them selves at risk of greater loan losses as balances rise so much.

Writing about loan growth, Jef feries analyst John Hecht wrote Nov. 16, “Card issuers all contin ue to compare positively versus estimates, driven by consumer demand/in ation pressure, in addition to a strong labor market. Issuers have not tightened credit decisioning until macro deterio rates further.”

Discover historically has been a more conservative lender than,

say, Capital One, which is will ing to lend to households whose credit score is slightly below prime. Discover sticks almost ex clusively to prime-rated borrow ers.

And Discover is tightening credit standards a bit, CEO Roger Hochschild told analysts on an Oct. 25 earnings call.

Net income through three quarters totaled $3.22 billion, or $11.73 per share, down from $4.29 billion, or $14.16 per share, in the same period last year. But more than 100% of that decline is

due to higher reserves for future loan losses as Discover prepares for a possible recession and al locates for normal losses tied to the extraordinary loan growth. In 2021, Discover didn’t have to set aside any money at all for future losses.

As of Nov. 22, Discover had posted a year-to-date stock price decline of 6.2%, better than the 8.5% decline for the S&P 500 Financials Index. Capital One, which lends to higher-risk con sumers than Discover, had suf fered a 30% decline.

People are piling way more debt onto their credit cards, including Discover’s, which is boosting earnings but also could worsen future losses in a bad recession

BLOOMBERG BLOOMBERG

Controversial Quincy hospital project can move forward, court rules

BY KATHERINE DAVIS

Quincy Medical Group is mov ing forward with plans to build a small-format hospital in Quincy af ter a court dismissed an appeal led by neighboring Blessing Health Sys tem to block the project.

QMG’s new hospital will include 25 medical surgical beds, three la bor, delivery, recovery and postpar tum rooms, an emergency depart ment with 10 bays, three operating rooms and one procedure room.

e hospital will also o er laborato ry, pharmacy and imaging services.

“We are grateful for the court’s decision; it allows Quincy Medical Group to move forward to create real change in health and care in the tri-states,” QMG CEO Carol Brock miller said in a statement. “Our physicians and family of employees have remained steadfastly commit ted to the QMG hospital and all that it can bring to our local patients, in cluding choice and a ordability.”

QMG would not con rm the

timeline for the project’s construc tion and completion.

e dismissal of Blessing’s ap peal to stop QMG’s hospital project last month is the latest update in a dispute between the two hospital groups that put private equity at the center of a decision to allow new hospitals to be built in rural areas already being served by safety-net and community providers.

QMG originally disclosed plans for its new hospital in 2020 and has since faced strong opposition from Blessing. e nonpro t, three-hos pital chain has argued that QMG’s new hospital would siphon o its pro table surgeries and privately insured patients that keep it a oat nancially. In the process, Blessing also took aim at QMG parent Duly Health & Care’s private-equity back er, Ares Management, expressing concern over what Blessing consid ers pro t-motivated ownership that could threaten care in the area.

QMG has defended itself by say ing it’s looking to introduce more

competition in Quincy’s health care market and provide services not currently o ered in the area.

After the contentious battle be tween the two hospital groups played out before the Illinois Health Facilities & Services Review Board, the board approved QMG’s project in April after previously issuing an intent-to-deny notice over concerns that the hospital would create “un necessary duplication of service” in the area.

Soon after the board approved QMG’s hospital, Blessing appealed the decision in a Sangamon County Court in Spring eld, and earlier in November, that court dismissed it.

“We are disappointed with the decision of the court to dismiss our request for review,” Maureen Kahn, president and CEO of Blessing, said in a statement. “We continue to believe that a second hospital in Quincy is an unnecessary duplica tion of services and are examining our options for reconsideration or appeal.”

We Honor. Thank. Inspire. NOTABLE

CRAIN’S: Can you tell us more about Honor Flight Chicago?

JOHN PTAK: We are a nonpro t organization and part of a nationwide network of approximately 125 honor ight hubs. Each hub operates independently. We have own more veterans than any other hub. We’re proud of the impact we’ve had on the lives we’ve touched along the way.

CRAIN’S: How did you get involved in Honor Flight Chicago?

Hundreds of volunteers make the mission possible, including Ptak who started volunteering at Honor Flight Chicago in 2011. In his current role as board president, he has helped expand the organization’s outreach to the wider community. Beyond his nonpro t leadership, Ptak has more than 20 years of experience in nancial services. He is currently a principal at Gofen & Glossberg, one of Chicago’s oldest nancial advisory rms.

PTAK: I am the grandson of a WWII veteran and the son of Vietnam War veteran. Growing up, I was close to my grandfather. I knew of his service, but I didn’t know anything about it. I was looking for an impactful way to honor our veterans when I read an article about the program. So, I volunteered. I started out working on various spreadsheets because of my background. Then I became a veteran ambassador working with veterans and their families. I joined the Board of Directors in 2014 and was named president in 2015.

CRAIN’S: How many ights have there been?

PTAK: Our ights run from April through October. This fall we wrapped up our 14th season with our 106th ight. To

Horizon Therapeutics is looking for a buyer

BY KATHERINE DAVIS

Horizon erapeutics is look ing for a buyer, con rming that it is in talks with some of the world’s largest pharmaceutical companies for a deal.

e Dublin-based maker of drugs for rare and rheumatic diseases, which has a signi cant presence in Deer eld, said in a statement Nov. 29 that its board of directors is engaged in “high ly preliminary discussions” with Amgen, Janssen Global Ser vices—a subsidiary of Johnson & Johnson—and Sano , a French pharmaceutical company.

Horizon said the conversa tions may or may not lead to an o er from one of these compa nies to acquire Horizon in its entirety, adding that there is no certainty any type of o er will be made. Horizon declined to com ment beyond its statement.

According to Horizon’s state ment, possible buyers are re quired by Irish law to announce whether they intend to make an o er by Jan. 10.

Q&A

with John Ptak

date, we have own 9,955 Chicago area veterans to be honored in Washington, D.C. We y veterans from World War II, Korea, and Vietnam. It’s amazing to see three generations of war heroes together in our nation’s capital receiving that day of gratitude that they so deserve. Years ago, I heard a veteran say “before today, I didn’t think anyone cared.” It is our mission to make sure they know that there are many of us who care deeply.

CRAIN’S: What’s the day like for the veteran?

PTAK: Each day begins before sunrise. The volunteers arrive around 2:30 a.m. and the veterans arrive at 4 a.m. For the next 16 hours they are treated as heroes, everywhere they go. The day is lled with tributes, ceremonies and memories. It’s an emotional day, and a busy day. We visit the memorials built in tribute to the service of our veterans.

CRAIN’S: What’s the highlight of the day?

PTAK: It’s the people. The veterans love the camaraderie they have with each other, and the interactions with the volunteers. So many well-wishers come out to cheer for the veterans, and they get a big welcome home celebration when we land back at Midway Airport at the end of the day. Our veterans say

As of Dec. 2, Horizon stock was up 32% since the deal was an nounced. e company’s market cap is more than $23 billion.

Horizon’s biggest drug is Tepezza, which treats thyroid disease. e company also man ufactures Krystexxa, which treats gout, an in ammatory arthritis disease.

Horizon posted net sales of $925.4 million in the third quar ter, down 11% from the same pe riod last year. However, net sales year to date are outpacing 2021, with Horizon posting $2.68 bil lion, up 21% from last year. As a result, Horizon increased its fullyear sales guidance from $3.59 billion to $3.61 billion.

As of Sept. 30, Horizon had about 2,095 full-time employees, according to its lings with the U.S. Securities & Exchange Com mission. Horizon is run by CEO Tim Walbert, who joined the company in 2008.

Horizon bought Takeda Phar maceutical’s former headquar ters in Deer eld in 2020, where it houses most of its workers.

it is truly one of the most memorable days of their lives.

CRAIN’S: How has the mission expanded?

PTAK: Two years ago, we launched Operation Education. We provide lesson plans and educational materials to more than 200 schools in the Chicago area to showcase our heroes. We connect veterans to speak at schools about their courage and determination. We also have a podcast for our veterans to tell their story in their own words.

CRAIN’S: Would you like to add anything?

PTAK: We are thankful to the generosity of those who participate in and support our mission. We have more than 2,500 deserving heroes on our waiting list, including my father. The generosity of donors, individuals, corporations and institutions make it possible, and we continue to need their support.

CRAIN’S: How can veterans apply for the program?

PTAK: Applications can be downloaded on our website (honor ightchicago. org) or requested by calling 773-227-8387.

John Ptak is humbled by the mission of the organization he leads, Honor Flight Chicago. The organization ies senior American war veterans to Washington, D.C. for a daylong recognition of their service and sacri ce to the nation.

Notable Nonpro t Board Leader

Quincy Medical Group will build its small-format hospital after a court dismissed an appeal led by Blessing Health System to block the private-equity-backed project

The maker of drugs is engaged in ‘highly preliminary’ talks with Amgen, Janssen Global Services and Sano

PEOPLE ON THE MOVE

ARCHITECTURE

BBA Architects, Chicago

Nick Moorhouse joined BBA as an Associate, leading projects through all stages of development and construction. He earned his Bachelor of Science in Architecture from the University of Minnesota-Twin Cities in 2012 and his Master of Architecture from the University of Illinois Urbana-Champaign in 2014.

Monica Musialowski joined BBA as an Associate, bringing with her more than a decade of experience in the high-end residential sector leading teams to see projects through from concept to move-in. She earned her Bachelor of Science in Architecture and Master of Architecture degrees from the University of Michigan.

ARCHITECTURE / DESIGN

Kahler Slater, an awardwinning architecture and design rm, has promoted Tracie Parent and Trina Sandschafer, AIA, LEED AP, to Executive Vice President. The promotions support the rm’s growth strategy, commitment to design, and dedication to meeting the needs of clients and employees.

As CFO and COO, Parent oversees operations of all of ce locations and provides executive direction to nance, risk, compliance, technology, and human resources.

Sandschafer serves as Design Principal and is responsible for fostering a strong design dialog and culture across the entire rm. She leads Kahler Slater’s Chicago of ce and serves diverse clients as a national leader for residential, hospitality, and corporate practices.

BANKING / FINANCE

U.S. Bank Private Wealth Management, Chicago

U.S. Bank Private Wealth Management is pleased to welcome Chris Chepy and Jonathan Prell. As Private Wealth Advisors, Chris and Jon are responsible for providing comprehensive wealth management strategies tailored to their clients’ speci c needs. These strategies encompass Investment Management, Private Banking, Trust and Estate Services, and Wealth Planning. Chris and Jon will take the time to understand their clients’ unique needs and direct teams of specialists - often working closely with other client advisors, such as attorneys and accountants - to provide services that help clients work towards their goals.

BANKING

First Bank Chicago, Northbrook

First Bank Chicago announces the promotion of Lenore Erickson to Chief Human Resources Of cer. She is responsible for providing strategic leadership to the Bank as it pertains to all aspects of the Human Resources function. She also acts as an advisor to senior management to identify, develop and implement HR strategies, programs, and processes to improve the organization, teams and individual effectiveness that enhance staf ng objectives. Lenore joined the First Bank Chicago team in 2013.

BANKING

First Bank Chicago, Northbrook

First Bank Chicago proudly announces the promotion of Merima Klaric to AVP Compliance Of cer & Assistant BSA Of cer. In this role, she assists with the ongoing monitoring of the BSA/AML/CIP/OFAC program in accordance with applicable laws, guidelines, and regulations. She works closely with a diverse team of professionals to ensure policies, procedures and training are in place while mitigating risk and exposure to suspicious and fraudulent activities. Merima joined the First Bank team in 2020.

BANKING

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

FINANCIAL SERVICES

Baird, Chicago

Byline Bank welcomes Tim Harrington as Vice President, Business Banking. Harrington brings nearly 30 years of nancial experience working for multiple regional nancial institutions to Byline’s recently expanded business banking team. Based in Evanston, Harrington focuses on creating exceptional customer relationships and forming genuine, bene cial partnerships with customers.

CONSTRUCTION

Lendlease, Chicago

Nelson Robles has been appointed as the Senior Manager of Strategic Outreach for Lendlease, re ecting the company’s commitment to adding social value to communities. Nelson brings over 20 years of experience working with diverse communities in the private, nonpro t and public sectors in Chicago. In this regional role, Nelson facilitates successful relationships and strategies with Community Leaders, Disadvantaged, Minority and Women Owned Business Enterprises (DMWBE) and project teams.

BANKING / FINANCE

SomerCor, Chicago

SomerCor has promoted Eric Bacon to Senior Vice President, Loan Of cer. Bacon has led SomerCor in Small Business Administration (SBA) 504 production for the last three years, with 137 authorized loans for over $363,000,000 in total project costs. He began his career in SBA lending at SomerCor as a credit analyst in 2016, before transitioning to the loan origination team in 2018.

Bacon has quickly distinguished himself as a top producer and subject matter expert in the industry.

BANKING / FINANCE

SomerCor, Spring eld

SomerCor is proud to announce the hiring of veteran SBA banker, Darin Gehrke, as Senior Vice President and Market Lead for Central and Southern Illinois.

Based in Spring eld, Gehrke will lead the organization’s expansion of SBA 504 lending and other economic development services in the region.

Gehrke comes to SomerCor with more than 15 years of SBA 504 and commercial lending experience. Most recently, Gehrke served as Community Bank President at Town and Country Bank in Jacksonville, Illinois.

CONSTRUCTION

Northern Builders, Inc., Schiller Park

Northern Builders, Inc. is pleased to announce the hiring of Aaron R. Chmiel as Executive Project Manager. In his new role, Aaron is responsible for overseeing all aspects of Northern’s construction projects including schedule, safety, budget, and quality to the complete satisfaction of our clients. Aaron brings over twenty-four years of construction experience to Northern’s team.

Maria Watts has been promoted to Co-Head of Global Consumer Investment Banking and a member of the unit’s senior leadership team at Baird, partnering with Brian McDonagh, Co-Head of Global Investment Banking. Watts will continue to manage her existing nancial sponsor client relationships and support Baird’s senior Consumer bankers in further growing their franchises. She holds an MBA from Northwestern University’s Kellogg School of Management and a BS from the Centenary College of Louisiana.

FINANCIAL SERVICES

Distributed Ventures, Chicago

Early-stage venture capital rm Distributed Ventures, which specializes in insurtech, healthtech, and ntech investments, announced the hiring of Joe Flanagan as Growth Partner. Joe will focus on helping earlystage companies within the fund’s portfolio develop and re ne their go-to-market strategies, fortify their commercial teams, and catalyze business development milestones. While serving as Growth Partner, Joe will also continue his position as Chairman of Acquirent.

FINANCIAL SERVICES

Wintrust Financial, Rosemont Wintrust is happy to announce the promotion of David DeWitt to Division Manager/Team Lead at Wintrust Bank, N.A. In his new role, Dave will manage a team of commercial bankers delivering middle market banking services to Wintrust Bank’s customers and prospects. David has over 20 years of middle market commercial banking experience.

ENGINEERING / CONSTRUCTION

Infrastructure Engineering Inc., Chicago

John E. Adams, CPA has joined Infrastructure Engineering Inc. (IEI) as Controller.  He will assume the day-to-day operations of the Accounting/Finance Department, bringing an increased level of knowledge, ef ciency, and productivity with 40+ years of varied, progressively elevated experience.  His presence and contributions will help drive IEI towards our strategic objectives. Prior to joining IEI, John founded the Bronzeville Trail Task Force and served as CFO of the Rainbow Push Coalition.

LAW

Freeborn & Peters LLP, Chicago

Freeborn & Peters LLP continues the expansion of its litigation practice group and Chicago of ce with the addition of Carly M. Allen as an associate. Allen served as a 2021 summer intern at Freeborn, where she worked with the litigation practice group on commercial litigation matters. Allen received her undergraduate degree from the University of Texas and her law degree from the University of Michigan Law School, where she served as the associate editor of the Journal of Race and Law.

LAW

Honigman LLP, Chicago

Nathan Howze joined Honigman LLP’s Chicago of ce as a partner in the corporate department. He’s responsible for venture capital & PE nancings, M&A, startups and emerging companies. He earned his J.D. and M.B.A. from Loyola University. He has advised hundreds of businesses across industries from tech to cannabis, life sciences and real estate. He was awarded the National Black Lawyers Best Lawyer In America and was recognized as a 2022 National Black Lawyers Top 40 Under 40 Illinois attorney.

NON-PROFIT

Little City Foundation, Palatine

Little City, a nonpro t serving 1,100 people with developmental and intellectual disabilities in the Chicagoland area, is thrilled to announce the recent promotions of Tina Maraccini and Kelly Evans. Tina Maraccini has assumed the role of Chief Development Of cer after more than decade of service at Little City including most recently as Director of Marketing & Communications.

Tina has been nationally recognized for her design work in the nonpro t sector.

Kelly Evans has assumed the role of Chief Human Resources of cer after spending more than 20 years in the developmental disabilities eld, including work on the program side. She will lead a Human Resources department charged with managing 400+ employees across multiple campuses.

NON-PROFIT

The Morton Arboretum, Lisle Jill Koski joined The Morton Arboretum as its president and CEO on Nov. 28. She is the Arboretum’s fourth leader in its 100-year history and rst woman chief executive. Jill was president and CEO of Ohio’s Holden Forests & Gardens since 2017 and was previously vice president of development at The Morton Arboretum for 10 years. She was named 2021 Community Leader of the Year for Environment and Sustainability by Cleveland Magazine.

PHILANTHROPY

The Brinson Foundation, Chicago

Dr. Michael Barber is joining The Brinson Foundation as a Senior Program Of cer. He spent the past two years partnering with leaders in Chicago Public Schools to connect research with practice, design improvement strategies, and build both learning-focused and internal monitoring tools. Previously at The Spencer Foundation, Michael has also been a teacher, and he continues to teach the next generation of educators at DePaul University. Michael will lead the Foundation’s education priority area.

Chepy Prell

Moorhouse Musialowski

Maraccini Evans

Kahler Slater, Chicago / Milwaukee

Parent Sandschafer

Byline Bank, Chicago

Chicago’s 2023 MEETING & EVENT PLANNING GUIDE

Welcome to the latest edition of Crain’s Content Studio’s Meeting and Event Planning Guide, showcasing a cross-section of the city’s myriad venue offerings and event service providers.

Our feature story highlights why Chicago is one of the best places to host your meetings. As you are making plans for your company’s events for the upcoming year – we hope you’ll pursue these unique listings which include both boutique and large-scale venues in the Chicago area and suburbs, and event service providers from catering to event planning, video production and more.

BY JANE ADLER

On an early November evening, the solarium at the Adler Planetarium became the perfect venue for a private dinner hosted by the Healthcare Institute. About 35 of its members enjoyed a catered meal with views of the Chicago skyline as a spectacular backdrop.

“It was an amazing evening,” says Debbie Guy, senior administrative director at the Pensacola, Florida-based organization. She brings a meeting to Chicago every fall. Last year, her group took a dinner cruise on Lake Michigan. Her go-to hotel is the Waldorf Astoria Chicago on the Gold Coast. “Great events and places like the Waldorf keep us coming back,” she says.

Meeting planners like Chicago. e area features unique venues, big and small meeting spaces, and world-class hotels, restaurants and cultural attractions. e Chicago area o ers what meeting planners describe as a great combination of

business-friendly venues and downtime activities. Attendees can blend business and leisure, a travel trend known as “bleisure.”

“Meetings are back,” says Dustin Arnheim at Choose Chicago, the sales and marketing arm for the City of Chicago. Year-to-date in 2022 the city has hosted about 1,200 events, accounting for 1.4 million hotel room nights and supporting 16,000 jobs for a total economic impact of $2.1 billion.

e meeting business really picked up in June and July, according to Arnheim. While meeting planners focused on smaller events during pandemic, big events are common now.

For example, Pack Expo 2022, held at McCormick Place in October drew 44,000 attendees, surpassing the event’s 2018 turnout. e packaging trade show featured 2,200 exhibitors taking more than 1.2 million net square feet of convention oor space.

“Chicago has a lot of advantages,” says Jim Pittas, CEO of PMMI, sponsor of Pack Expo. With over 2.6 million square feet of exhibit space, McCormick Place is the largest convention center in North America. Pack Expo needs a lot of space for the big machinery featured at the show. Pittas also likes the fact that McCormick Place has skilled union workers who know how to carefully handle big, expensive machines.

Meeting planners really like Chicago’s central location. It’s easy to book direct ights from most parts of the country.

Another advantage: Good local suppliers. Aloha Print Group o ers all kinds of display signage and marketing materials. “Every meeting or event has a di erent feel, focus, and desired result and we are able to make that vision tangible and physical,” says Ginger Peak, president at Aloha. “Our competitive advantage is our customer service team and our experience and exibility in working with clients.”

e area’s hotels are a big draw. e Waldorf Astoria Chicago was recently renovated. e property has 215 hotel rooms, meeting venues and a destination spa. e hotel recently relaunched Bernard’s, a cocktail lounge on the second oor that features curated cocktails.

e hotel is located near popular cultural attractions, rst-class shopping spots and Lake Michigan. “Chicago brings business and pleasure together,” says Catie Walsh, director of sales and marketing at the Waldorf Astoria.

Chicago’s unique venues help drive attendee engagement—a priority of meeting planners. Engaged participants are more likely to interact with each other and feel good about the event.

e Chicago History Museum, for example, can host as many as 1,000 people for strolling events or as few as 25 for small occasions such as a company awards program. e museum has a theater that seats 299 people.

Rotating exhibits provide interest. Meeting planners can tie Chicago history to the event along with a menu to match. “Events can connect with the space,” says Lorelei Kroulaidis, director of special events at the Chicago History Museum. “Attendees have an authentic experience.”

Looking for a meeting spot in the suburbs? e North Shore has 12 full-service hotels. e DoubleTree Hotel in Skokie was recently renovated. e hotel’s roo op Monaco Room features windows with 360-degree views to O’Hare and downtown. e hotel is adjacent to the North Shore Center for the Performing Arts.

Downtown Chicago is easily accessible from the North Shore. e CTA and Metra provide service to the suburbs. Wrigley Field is a short ‘L’ ride away. Attendees coming from O’Hare can avoid the Kennedy Expressway tra c jams.

Evanston features a nice mix of an urban-suburban experience, according to Gina Speckman, executive director of Chicago’s North Shore Convention & Visitors Bureau. e organization represents 10 communities on the North Shore.

Several weeks ago, a travel group hosted a three-day meeting for about 120 attendees at the DoubleTree Hotel in Skokie. e group spent an evening in Evanston, surprised to nd 50 restaurants within a three-block radius. “People had an amazing time,” Speckman says.

150 NORTH RIVERSIDE

Category: Venue

Neighborhood: West Loop 150 North Riverside, Chicago, IL 60606 312-635-6263

Capacity: Standing: 300, Seated: 200 150northriverside.com

Located in the heart of downtown Chicago, 150 North Riverside rises 54 stories on a twoacre site with breathtaking views. The national & international award-winning tower boasts 1-1/2 acres of outdoor space including a park, amphitheater and Riverwalk. The event spaces include a 200-seat river-view ballroom and two boardrooms. The venue also features an iconic lobby with the largest digital art installation in Chicago, the award-winning ‘150 Media Stream’ and is ideal for galas, fundraisers and will be the perfect location for you next event!

CABARET ZAZOU

Category: Venue

Neighborhood: Theatre District/Loop 32 W. Randolph Street, 14th Floor, Chicago, IL 60601 312-488-0900

Capacity: 330 www.cabaretzazou.com

VENUES

KOI FINE ASIAN CUISINE & LOUNGE

Category: Venue

Neighborhood: Downtown Evanston 624 Davis Street, Evanston, IL 60201 847-866-6969

Capacity (Banquet and Standing): 12-80 www.koievanston.com

LE SUD

Category: Venue

Neighborhood: Roscoe Village 2301 W. Roscoe Street, Chicago, IL 60618 773-857-1985

Capacity (Banquet and Standing): 12-60 www.lesudchicago.com

LM STUDIO

Category: Venue

Neighborhood: South Loop 808 S. Michigan Avenue, Chicago, IL 60605 312-995-0134

Capacity (Banquet and Seated): LM Studio (6th Floor): 200 seated rounds, 350 cocktail reception Atrium (5th Floor): 80 seated rounds, 40 seated rectangle, 150 cocktail reception lmstudiochicago.com

MARRIOTT LINCOLNSHIRE RESORT

Category: Venue 10 Marriott Drive, Lincolnshire, IL 60069 847-634-0100

Capacity: 1,300 marriott.com/meetings-events

MESA URBANA

Category: Venue

Neighborhood: Lincoln Park 1935 N. Lincoln Park West, Chicago, IL 60614 773-312-7040 mesaurbana.com

CHICAGO HISTORY MUSEUM

Category: Venue

Neighborhood: Lincoln Park

1601 N. Clark Street, Chicago, IL 60614

312-799-2254

Capacity: Standing: 1,000, Seated: 340 chicagohistory.org/corporate-events

Sip cocktails next to one of Chicago’s rst “L” cars. Dance the night away against a backdrop of Lincoln Park’s lush gardens and the glittering lights of the city skyline. Tucked along the grounds of Lincoln Park, steps from the lake and a short cab ride from downtown, the Chicago History Museum offers a variety of spaces that can be used for corporate events, daytime meetings, cocktail receptions, reunions, or just about any type of event.

MORDECAI

Category: Venue Neighborhood: Lakeview 3632 N. Clark Street, Chicago, IL 60613 773-269-5410

Capacity: Standing: 80, Seated: 40 mordecaichicago.com/private-events

THE DALCY

Category: Venue

Neighborhood: Fulton Market 302 N. Green Street, Third Floor, Chicago, IL 60607 773-645-1430

Capacity: Standing: 500, Seated: 300 thedalcy.com

Rustic meets elegance at The Dalcy – Lettuce Entertain You’s private event hall located in the historic Fulton Market District. Sharing the third oor with Aba, a Mediterranean & Californiainspired restaurant, the 6,000-square foot venue and 4,000-square foot rooftop patio is the ideal setting for cocktail receptions, meetings, weddings, social and business gatherings and corporate events.

MORGAN’S ON FULTON

Category: Venue

Neighborhood: Fulton Market District 950 W. Fulton Market, Chicago IL 60607 312-374-3686 morgansonfulton.com

FLYING HORSE RESORT & CLUB

Category: Venue

Neighborhood: Flying Horse 1880 Weiskopf Point, Colorado Springs, CO 80921 719-487-2662

Capacity (Banquet and Seated): 300 lodgeat yinghorse.com

Flying Horse Resort & Club represents unparalleled comfort for your next conference or corporate event in beautiful Colorado Springs, Colorado. With signature options for overnight guests and day attendees, our hospitality team will help take your event to extraordinary new heights. Flying Horse offers 96 luxurious guest rooms and 4 independent two-bedroom suites, nine function rooms totaling nearly 10,900 sq. ft. of indoor event space and more than 10,000 sq. ft. of outdoor function space.

THE SALT SHED

Category: Venue

Neighborhood: North Branch/Goose Island 1357 N. Elston Avenue, Chicago, IL 60642 708-967-2168

Capacity (Banquet and Standing): Full Venue: 7,000 The Salt Shed: 650-3,000 Fairgrounds: 4,000 3rd Floor Lounge: 60-120 www.saltshedchicago.com

THE LASALLE CHICAGO, AUTOGRAPH COLLECTION

Category: Venue

Neighborhood: Loop 208 S. LaSalle Street, Chicago, IL 60604 312-634-0000

Capacity: Standing: 150, Seated: 110 thelasallechicago.com

Sophisticated and tailored, The LaSalle Chicago is the preeminent destination within the heart of downtown Chicago. Enjoy city views and natural light from elegant meeting rooms equipped with the latest technology and featuring high-end stone and marble nishes, to our high-rise Ballroom showcasing skyline views. The LaSalle Chicago offers an elevated experience designed for productivity, privacy, and exclusivity including our private dining room, cozy library, and semi-private Solarium in our restaurant, Grill on 21.

THEATRE ON THE LAKE

Category: Venue

Neighborhood: Lincoln Park 2401 N. Lake Shore Drive, Chicago, Illinois 60614 312-414-1313

Capacity: Standing: 1,000, Seated: 500 theateronthelake.com

TWENTY SIX

Category: Venue

Neighborhood: River North 2 W. Erie Street, Chicago, IL 60654 312-995-0134

Capacity: (Banquet and Seated): 150 Cocktail Style Reception (Indoor Only) 180 Cocktail Style Reception (Indoors and Outdoors) twentysixchicago.com

Category: Venue

Neighborhood: Gold Coast 58 E. Oak Street, Chicago, IL 60611 312-736-9999

Capacity (Banquet and Seated): 8 to 200 esquirebych.com/event-planning

Esquire by Cooper’s Hawk offers some of the most unique private dining spaces in the iconic Gold Coast of downtown Chicago. The stunning space features eight private dining rooms for events ranging from intimate groups of eight to receptions of over 200. Enhanced by exceptional custom menus, curated wine pairings, and an unrivaled wine list with over 1600+ bottle selections, guests of any private event are in for a truly extraordinary experience.

THE GERAGHTY

Category: Venue

Neighborhood: Pilsen 2520 S. Hoyne Avenue, Chicago, IL 60647 312-967-2520

Capacity: Standing: 1,200, Seated: 1,000 thegeraghty.com

A venue of possibilities — The Geraghty is a sophisticated, diverse space intent on rede ning the standard in contemporary venues. Devised by industry visionaries, The Geraghty was built to be completely customizable to inspire innovation and create captivating experiences with awless execution. The result is a thoughtful, expansive venue equipped with state-of-the-art technology to realize any vision. We invite you to discover how we can help curate your next experience of a lifetime.

MARCHESA

Category: Venue

Neighborhood: River North 535 N. Wells Street, Chicago, IL 60654 312-527-9535

Capacity: Standing: 125, Seated 85 marchesachicago.com

MARCHESA, featuring four art- lled spaces in a historic building in River North, offers delicious French & Italian cuisine for business dinners, cocktail parties, board meetings and luncheons. Our imaginative team will create an exquisite menu for you -- from simple dishes to life’s delicacies -- and work within your budget to provide the biggest splash for your event dollar. Polished staff coordinates all the details that make the biggest impact on guests. We are at your service!

ESQUIRE BY COOPER’S HAWK

MUSEUM OF CONTEMPORARY

ART CHICAGO

Category: Venue

Neighborhood: Streeterville 220 E. Chicago Avenue, Chicago, IL 60611 312-397-3872

Capacity: Standing:1,000, Seated: 300 mcachicago.org/rentals

Add an artful twist to your next event! Featuring spacious and exible event spaces, the Museum of Contemporary Art Chicago provides a sophisticated and distinct setting for your company’s event. Our unique indoor/ outdoor event spaces are centrally located in Streeterville and will impress your guests and inspire creativity among colleagues.

PEPPER FAMILY WILDLIFE CENTER

Category: Venue

Neighborhood: Lincoln Park 2021 N. Stockton Drive, Chicago, IL 60614 773-571-0404

Capacity: Standing: 600, Seated: 400 lpzoo.org/private-events

Lincoln Park Zoo’s newly renovated Pepper Family Wildlife Center is home to some wild event space! The historic Great Hall, built in 1912, is just over 7,000 sq. ft. and can accommodate up to 400 seated/600 reception. The 1,100 sq. ft. conference room (80 seated/100 reception), located just off the Great Hall, is perfect for everything from birthdays to board meetings. It features oor to ceiling windows facing the lions’ habitat and state-of-the-art AV capabilities.

BLUE PLATE

Category: Catering 1362 W. Fulton Street, Chicago, Illinois, 60607 312-421-6666 blueplatechicago.com

Blue Plate is Chicago’s caterer. From corporate celebrations to fundraising galas or in-of ce business dining - Blue Plate can ex to provide customized catering solutions for your event or meeting. Driven by culinary creativity and with preferred status at more than 85 iconic Chicago venues, Blue Plate has earned a national reputation for its standard of service and innovation.

PIZZA CITY TOURS

Category: Food Tours 1156 W. Ohio 1W, Chicago, Il 60642 773-230-7157 pizzacityusa.com

His tory, inspired

.

Steps from the lake, nestled in the Gold Coast, the Chicago History Museum is the perfect location for large staff meetings, presentations in a cinema quality theater, intimate collaborations, and lively cocktail receptions.

Clark & North | chicagohistory.org 312.799.2254 | events@chicagohistory.org

Tay Kaune Photography

Chicago features unique venues, big and small meeting spaces, and world-class hotels, restaurants, and cultural attractions.

THE PLATFORM CONFERENCE CENTER

Category: Venue

Neighborhood: Loop 320 S. Canal Street, Chicago, IL 60606 312-475-3201

Capacity: Standing: 300, Seated: 144 320southcanal.com

The Platform Conference Center is 320 S. Canal’s world-class, tech-forward conference center. Boasting four impressive spaces, The Platform can host groups of 10-300. An on-site catering kitchen ensures the highest level service from your preferred caterer. Audio/ video conferencing capabilities, wireless and lapel mics, and multiple screens will make certain your meeting goes seamlessly. The Green at 320, a 1.5 acre park space at the same address, is also available for private and semi-private outdoor events.

VENUES

TINLEY PARK CONVENTION CENTER

Category: Venue

Neighborhood: Southwest Suburbs 18451 Convention Center Drive, Tinley Park, 60477 708-342-5485

Capacity: Standing: 7,000, Seated: 2,000 tinleyparkconventioncenter.net

The Tinley Park Convention Center features state-of-the-art, on-site guest accommodations at EVEN Hotel, as well as the latest technology, free parking and an experienced staff, making it ideal for a meeting of 10, banquet for 1,500 or expo of 5,000. With 11 rst-class hotels and premier dining options nearby, there’s space to accommodate your event guests. Come and see the 10,000 square feet of possibilities – trade shows, banquets, fundraiser galas, weddings and more!

THE EVENT CENTER AT RIVERS CASINO

Category: Venue

Neighborhood: Des Plaines 3000 S. River Road, Des Plaines, IL 60018 888-307-0777

Capacity: Standing: 1,000, Seated: 550 RiversCasino.com/DesPlaines

Rivers Casino is Chicagoland’s newest and most exciting event destination with exceptional dining, a premier casino experience, live entertainment and more. This 450,000-square foot entertainment complex is perfect for your event: trade shows, conventions, galas, meetings and more accommodating up to1,000 guests. Our seasoned team will ensure every detail is customized to your group. Rivers Casino’s perfect location, variety of event spaces and unique experiences will make your next event a hit!

RIVER ROAST

Category: Venue

Neighborhood: River North/The Loop 315 N. LaSalle Drive, Chicago, IL 60654 312-822-0100

Capacity: Standing: 450, Seated: 330 riverroastchicago.com

Situated in the heart of the city, with striking views of the Chicago River and city skyline. River Roast Private Events offers an impressive setting for your next party or meeting as a lively social house and gathering place. With six event spaces to choose from – each featuring sophisticated decor that pays tribute to the historical landmark building the restaurant is housed in – the options for corporate and social events are endless.

WALDORF ASTORIA CHICAGO

Category: Venue

Neighborhood: Gold Coast 11 E. Walton Street, Chicago, IL 60611 312-646-1324

Capacity (Banquet and Standing): 160 waldorfastoriachicagohotel.com

Waldorf Astoria Chicago is the spectacular setting for unforgettable meetings and events in Downtown Chicago’s Gold Coast neighborhood. Chicago’s striking views await you from every oor-to-ceiling window with the city’s nest entertainment, dining, and shopping right outside the hotel’s private courtyard. Our opulent interior furnishings and bold artwork with modern luxury business amenities create the premier venue for meetings and events.

WHIRLYBALL

Category: Venue

Neighborhood: Bucktown 1825 W. Webster Road, Chicago, IL 60614 773-486-7777

Capacity: Standing: 1200, Seated: 200 whirlyball.com

With two stories and 50,000 square feet of fun, WhirlyBall’s Bucktown location is the perfect spot for corporate meetings and teambuilding events. With 3 WhirlyBall courts, 12 bowling lanes, a 200-person multi-function event space, 4 break-out rooms, a VIP private bowling alley, and a multi-level laser tag arena, there is enough space to get your competitive team spirit going. Book your 2023 meetings at WhirlyBall! Eat. Drink. Game ON!

EVENT PLANNING SERVICES & PROVIDERS

THE CHOPPING BLOCK

Category: Event Space

Neighborhood: Lincoln Square

4747 N. Lincoln Avenue, Chicago, IL 60625 773-472-6700

Capacity: Standing: 50, Seated: 50 thechoppingblock.com

CHICAGO’S NORTH SHORE CONVENTION & VISITORS BUREAU

Category: Event Planning Chicago North Shore Suburbs in Cook County 847-763-0011 visitchicagonorthshore.com/meetingspace

NAPERVILLE CONVENTION & VISITORS BUREAU

Category: Event Planning

22 E. Chicago Avenue, Suite 205, Naperville, IL 60540 630-305-7701 visitnaperville.com

No matter your needs, no matter your goals, Naperville is your one-stop destination for your corporate meetings and events. Equipped with 18 hotels, and over 300 restaurants, you don’t have to worry about scouting the perfect location or nding the perfect place to eat. There’s everything from 4-star, full-service hotels, to extended stay locations, to cozy spots for small parties. Whatever you’re looking for, Naperville has what you need. Contact us at VisitNaperville.com for complementary services and more.

Bordering Chicago along Lake Michigan, Chicago’s North Shore enjoys proximity to Downtown Chicago and O’Hare Airport. Our properties offer superior amenities including free parking, rooftop ballrooms, conference centers and advanced AV. Chicago’s North Shore is a preferred destination for meeting planners who choose to offer their attendees a broad range of attractions, restaurants, evening entertainment and shopping options in an area known for its natural beauty. Ask us about our incentive programs and enjoy personalized planning assistance.

ABSOLUTE PRODUCTION SERVICES

Category: Audio/Visual/Photography/ Videography 2142 W. Walnut Street, Chicago, IL 60612 312-226-1200 absolutepros.com

When it comes to event production, we believe anything is possible. For nearly 3 decades, Absolute Production Services has been a leading corporate event production company. Proud to be from Chicago, we offer services locally and globally, helping clients around the world turn visions into reality and pull off the seemingly impossible. We are a full-service production company and a total solution for production services. Tell us what you need, we’ll make it happen.

northof ordinary

State-of-the-art meeting facilities in unique spaces raise the level of your event. Personalized service to fit your meeting needs in space close toafter-hours experiences can be sourced by contacting Kimberly Wright, CMP at kwright@cnscvb.com find your unique venue at visitchicagonorthshore.com/meetingspace

The Chicago area offers what meeting planners describe as a great combination of business-friendly venues and downtown activities.

ALOHA PRINT GROUP

Category: Printing 141 W. Jackson Blvd. S-A100A, Chicago, IL 60604 312-542-1300 www.alohaprintgroup.com

Full service b2b print company located in downtown Chicago. With over 20 years of experience, we print anything from business cards to banners and signage for your event. Name badges, pull-up banner stands, boards, posters, and oor and window graphics. Pick up at our of ce, or we deliver to local venues. Customer Service Team and Graphic Designer in-house every day to make sure we produce exactly what you need for your event to be a success.

BLACKOAK TECHNICAL PRODUCTIONS

BlackOak Technical Productions is a designfocused and human- rst production company. Our team works relentlessly to be bold in design and kind in approach. As a proud member of the Kehoe Designs family of brands, we have years of experience bringing a fresh approach to events for corporate, social, and non-pro t clients. Let’s get started on making your next project a success.

Join Chicago’s top architects, brokers, developers, proper ty managers, contractors and design professionals to celebrate the outstanding achievements of the industry and support the Greater Chicago Food Depositor y.

Rising

fast-rising interest rates is a sud den drop in demand for newly re habbed homes on Chicago’s South Side and in the south suburbs.

e slump threatens to su ocate a wave of ipping that in the past decade has refreshed thousands of homes in those areas, helping to stabilize them by enhancing their appeal to homeowners.

Ewell is one of ve rehabbers and real estate agents who told Crain’s the rehab wave has slowed sharply. Britta Rivera, a Baird & Warner agent who often works with small rms that invest in re habs, says “they haven’t stopped, but they’re all slowing down.”

Nicely redone homes with owner-occupants can inoculate a neighborhood against decline and blight. eir kitchens tted with stone countertops and stainless steel appliances, their baths, base ments and facades given stylish makeovers and their climate sys tems modernized, these updated houses “have been re-energizing my neighborhood,” says Ald. Roderick Sawyer, 6th. His ward includes Chatham, where at one point during the boom, one in four homes that sold was a recent rehab.

“ e thing about these rehabs over the last 10 years is, they’ve added a great degree of resilience to the communities,” says Cook County Commissioner Bridget Gainer, who led the creation of the county’s land bank. Many re habbed homes started out as fore closed and derelict properties the Cook County Land Bank Authority bought in order to eliminate red tape and resell them to investors who could put the property right. Others were homes whose long time owners couldn’t a ord to maintain them.

SUPPLY AND DEMAND

Gainer says one of the founding goals of the Cook County Land Bank Authority was to help mop up the enormous overhang of run-down foreclosures from the housing bust of 2007, and another was to “lower the barriers to entry for the small investor.” At least 600 small investors have bought hous es and apartment buildings from the land bank since it debuted in 2013, she says.

“I never imagined it would be that many,” Gainer says. e rehab community has been so active, it has even spawned social media communities, with names like Black Girls Buy Buildings and Flippin’ in Heels on Instagram.

Two factors boosted the pro gram.

First, house ipping became one of TV’s favorite genres in the 2010s, attracting lots of newcom ers to the business. In the rst half of 2022, nearly one in 10 homes sold in the U.S. was a rehab-andip, according to Attom, a prop erty information service. at’s twice the proportion in the rst half of 2019.

Second, the pandemic era’s hous ing boom jacked up home sales ev erywhere, and in particular among people for whom record-low in

terest rates made homeownership attainable for the rst time. us, the swelling supply of re habs in South Side neighborhoods and south suburbs met equally ro bust demand.

In March 2021, a rehabber paid $25,000 for a rundown Cape Codstyle house hidden behind tall, shaggy shrubbery on Marsh eld Avenue in Auburn Gresham. After a complete makeover, the house came on the market in December at $279,900 and went under con tract to a buyer in a week. e sale closed in February at $290,000, or 3.6% over the asking price.

Soon after that, everything changed.

rough subsequent increases, mortgage rates more than dou bled in the course of the year, from the low 3% range in January to over 7% in late October.

“When you’re talking about in terest rates, you’re talking about a ordability,” says Courtney Jones, executive director of the Chicagobased Coalition for Black Housing. Because Blacks “are lower on the income scale and the credit scale, when the Fed raised rates, it impact ed us the most,” Jones says.

Now, more than two dozen re cent rehabs in South Side neigh borhoods have been on the mar ket for six months or more, Crain’s research shows.

When interest rates started ris ing, buyers “just disappeared,” says LaShonda Williams, a Living Well Realty agent. “It was like ev eryone got out of the game at the same time.”

Williams represents a rehab on Damen Avenue in Auburn Gresh am that came on the market in June at $329,500 and remains unsold. e asking price is now $295,000.

Last year, when rates were low and the boom was on, Williams

says, “we would have had that sold in a week, probably with multiples.” Multiple o ers were a near con stant in the late, lamented boom.

MICROPHENOMENON

Refurbished homes occupied by new homeowners can bolster a neighborhood, but unsold and unoccupied rehabs can have the opposite e ect. Over the summer, a microphenomenon emerged when people broke into vacant rehabs and hosted out-of-control parties. In areas that have long struggled to keep unsavory ele ments like that out, nobody wants to see the phenomenon grow, en couraged by widespread vacancies.

Several sources said they don’t expect the market to deteriorate to that point. Buyers are still out there, they note.

Courtney Davis is one. A coach of special education students and their parents in Alexandria, Va., Davis grew up in Rosemoor, a part of Roseland where her aging par ents still live. Hoping to live near them sometime soon, Davis is buying a newly rehabbed threeunit rowhouse in Pullman. e property hit the market in April at about $320,000 and later dropped by $90,000. Her purchase closes in December and the nal purchase price won’t be disclosed until then.

“I wanted to have something like the Rosemoor neighborhood I grew up with,” Davis says. “I want ed a home that was safe and clean with everything up to date and re habbed,” she says.

e rehab wave, Davis says, “created housing opportunities for people like me who want to come back to the South Side.”

Byline Bank to buy Inland Bank in $165M deal

The

deal for $1.2 billion-asset Inland marks the rst major local move in what has been an extraordinarily slow year for bank mergers

BY STEVE DANIELS

The parent of Chicago’s By line Bank has a $165 million deal to acquire the parent of Inland Bank & Trust, majority owned by real estate mogul Dan Goodwin.

The deal marks the first major local bank acquisition of what has been an extraordinarily slow year for bank mergers.

The sale of $1.2 billion-asset Inland, based in west suburban Oak Brook, will bring Byline to about $8.5 billion in assets and continue a string of local deals over the past five years that have added heft to Byline.

For Goodwin, 78, a billion aire who made his fortune in commercial real estate but has owned Inland and its predeces sor for three decades, the sale will provide liquidity to minori ty shareholders who’ve been alongside him for his some times-bumpy banking ride through much of that lengthy period.

Byline is paying with a com bination of 85% stock and 15% cash. The deal values Inland at

about 1.25 times its book value, a going rate for the few deals getting done this year.

Goodwin will own a little over 10% of Byline’s shares following completion of the deal, which is expected in the second quarter of 2023. Goodwin also will have the right to appoint a designee to Byline’s board.

ADDING BRANCHES

Strategically, the purchase of Inland gives Byline branches in some western and northern suburbs where it isn’t present. But mostly it provides low-cost deposits, which are rapidly growing in value with the ex traordinary rise in interest rates this year.

“From day one, we’ve been all about deposits and the qual ity of deposits,” Byline CEO Ro berto Herencia said in an inter view. “This is first and foremost a really attractive transaction because you get a really nice deposit base.”

Many of the Inland Bank shareholders were investors in Goodwin’s Inland real estate investment trusts. Those REITs

typically liquidated within a de cade. The bank’s investors have been waiting 20 years or more, said Peter Stickler, CEO of In land Bank.

“They’ve been asking for some type of liquidity,” said Stickler, 70, who has been with Inland for more than 14 years. “Dan decided this was the time.”

Stickler and other senior Inland executives will stay through a transition period once the deal closes.

With Inland added, Byline will have $6.2 billion in loans and $6.8 billion in deposits, housed in 47 area branches. Inland will wind down its mort gage lending business, which has slowed considerably this year with the spike in interest rates, before the deal closes.

REAL ESTATE

One interesting opportunity for Byline is potentially cater ing to Goodwin’s Inland com panies, which are in frequent need of bank loans to do real estate deals. Because Good win was majority owner, Inland

Bank was barred from lending to real estate companies he was tied to.

“We’ll have an opportunity to bid on the business,” Herencia said, “but (negotiations) will have to be arm’s length.”

Herencia said he likes By line’s position in the market as principal competitors like Rosemont-based Wintrust Fi nancial grow so much larg er—Wintrust now exceeds $50 billion in assets. A region that

once was home to several banks between $3 billion and $10 bil lion in assets—banks that serve privately held businesses that aren’t quite large enough to in terest bigger banks—now has just a few.

The big banks “are not wor ried about us, which is great,” he said.

The investment bank advis ing Byline was Stephens, while Inland used Piper Sandler as its financial adviser.

Pandemic shift to online sales exposed restaurants to more ‘friendly fraud’

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area. “ e amount of charge backs that we get and the time that is spent and the training that we’ve had to give our sta . . . that has gone up dramatically.”

Pre-pandemic, 1 restaurant cus tomer out of every 400 called their credit card company and asked for money back. Now, it’s about 1 out of every 100, estimates nancial consulting rm Chargebacks911.

e cost of dealing with those is sues has skyrocketed, too. In 2019, the restaurant industry was spend ing about 2.5% of revenue on man aging credit card fraud, including paying fees, ghting the fraud and training employees on what to look for. Today that number is 10%.

Avli deals with at least one chargeback a day among its ve restaurants, which collectively lose thousands of dollars each month on the issue, Alexakis says. Chargeback incidents are up about 30% from pre-pan demic levels, he estimates. He declines to disclose the group’s overall revenue, but says his smaller restaurants might not pass $250,000 in sales during winter months.

“Losing a thousand is terrible,” he says. “It may not sound like it, but it’s terrible.”

at’s because margins are no toriously low in the restaurant business. e average restaurant makes 3% to 5% pro t, according to the National Restaurant Associ ation.

In ation is pinching margins even tighter. For many restau rants, recent menu price increas

es aren’t fully o setting their ris ing costs. Restaurant prices were up 8.6% in October from the year prior, according to the consumer price index.

Restaurants pay a fee of $15 to $25 every time a customer re quests a refund, often erasing the pro t on a meal even if the restau rant successfully contests the chargeback.

“It has to be a certain amount to make it even worth it to ght back,” says Korina Sanchez, vice president and general counsel at ird Coast Hospitality Group, which owns Tree House in Riv er North and Moe’s Cantina in Wrigleyville. “We have some pretty big checks sometimes, es pecially at our club. When people get bottles, they’re in the hun dreds and thousands. We’ve had a couple big ones get denied.”

BAD ACTORS

Tree House has recorded 260 chargebacks on checks totaling almost $66,000 since the start of 2020, Sanchez says. She declines to disclose overall revenue, but says chargebacks have nearly tripled since the pandemic hit. “It’s de nitely one of our top issues that we deal with.”

Some friendly fraud incidents result from honest mistakes, says Monica Eaton-Cardone, chief op erating o cer of Chargebacks911. Someone doesn’t recognize a charge on their credit card state ment that a spouse made, or may be a teenager uses a parent’s card to buy pizza without permission. But bad actors are behind many incidents, she says. Additionally,

scams tend to rise when the econ omy slows.

Friendly fraud unfolds in var ious ways, depending on which banks and credit card processors are involved. Typically, a custom er reports a fraudulent charge to a card issuer. e issuer then noti es the restaurant, which has 10 days to contest the claim and provide proof the customer did make the purchase. Usually, the card issuer adjudicates.

Restaurants can take precau tions, such as using payment terminals that read credit cards with chips. e major credit card networks—Mastercard, Visa and American Express—began imple menting a rule in 2015 that made merchants liable for fraud if they did not use such payment sys tems, which are more secure than magnetic strips. Chips contain en crypted data that cannot be used if the card is not present. If a patron pays with one, they cannot claim their card information was sto len. Experts say restaurants with out chip readers will lose a ght against friendly fraud every time.

Still, there are no guarantees. Most friendly fraud cases involve actual purchases by actual cus tomers, and those are hard to ght, experts say. Merchants win about 30% of chargeback disputes, ac cording to a report from payment dispute technology company Mi digator. e report doesn’t break out a speci c win rate for restau rants.

Friendly fraud is even more prevalent online. E-commerce charges are 50 times more likely to result in a chargeback, according

to Chargebacks911. Experts say restaurants that process their own online sales, rather than using a third-party service, are the most vulnerable.

Manny’s Cafeteria & Delica tessen owner Dan Raskin spent $1,500 apiece last month on six chip readers for his 80-year-old South Loop restaurant. But those don’t help with online friendly fraud; Raskin says about four or ve of 60 or so daily online orders result in chargebacks.

PREVENTION

Credit card processors use arti cial intelligence and technology to help prevent friendly fraud, says Jason Paguandas, general man ager of the merchant security and fraud business at Fiserv, a major credit card processor. ere’s also a change coming next spring that

could help: Visa will broaden the evidence merchants can present when ghting a fraudulent charge.

“It would result in merchants having higher win rates” in friend ly fraud disputes, Paguandas says.

Something has to give, says Manish Mallick, owner of Bar Goa in River North and Rooh in the West Loop. Even with chip readers, his Indian restaurants lose tens of thousands of dollars annually to friendly fraud, he says. And most of the incidents stem from in-person transac tions, during which a customer eats their meal without com plaining.

“ ey can put us out of busi ness,” Mallick says. “It’s easy fraud. at’s why they call it ‘friendly fraud,’ because there are no consequences. . . .It’s a con stant pain in the ass.”

SCAM

Korina Sanchez, vice president and general counsel at Third Coast Hospitality Group.

JOHN R. BOEHM

GOOGLE

Zell apartment firm teams up with Airbnb

owner, with more than 79,000 units, according to the Nation al Multifamily Housing Council. e rm began exploring a part nership with Airbnb way back in 2015.

A spokesman for Equity Resi dential, a real estate investment trust, did not respond to requests for comment. A representative for San Francisco-based Airbnb did not return a phone call.

Because most apartment land lords forbid short-term subleases, tenants who want to make a little extra money by renting out their units on a short-term basis of ten have to do it on the sly. Many building owners don’t like vaca tion rentals in their properties over concerns they’ll be disrup tive or cause security problems.

REVENUE SHARE

e new Airbnb program brings the practice out in the open. Un der the arrangement, landlords who participate will get a share of the total booking revenue from Airbnb rentals, usually 20%, ac cording to the Wall Street Journal.

e program could also give landlords a marketing edge, ca tering to tenants who want to make a little extra money when they’re not home.

“I think that buildings are see ing that this is an opportunity to attract tenants and really di er entiate themselves from other buildings,” Nathan Blecharczyk, Airbnb co-founder and chief strategy o cer, said in an inter view with CNBC.

Shares of Equity Residential, including dividends, the shares have returned -28.6% this year, versus 31.4% for an index of apartment REITs, according to Bloomberg. Zell also heads two other Chicago-based REITs, Eq uity Commonwealth and Equity LifeStyle Properties.

Firms join group investing in Cboe crypto unit

e participation in Cboe’s enterprise, announced Nov. 29, is meant at least in part to demonstrate con dence in the future of cryptocurrencies de spite a disastrous year for the nascent asset class. e recent implosion of FTX, one of cryp to’s largest exchanges, has sown doubt about how safely inves tors can invest in various crypto assets.

Several of the rms invest ing in Cboe Digital already are trading on the platform, and all of them eventually will be, Cboe Digital President John Palmer said in a release.

“Each of these partners share Cboe’s deep commitment to bringing a trusted, regulato ry- rst approach to the digital asset space,” he said. “ e time is right for the Cboe Digital mod el in the digital asset space, and we look forward to leveraging the combined expertise of these rms as we work together to grow, shape and de ne this asset class to bene t market partici pants across the globe.”

INVESTORS

In addition to DRW and Jump, investors include Menlo Park, Calif.-based brokerage Robin hood as well as equity clearing

platform Virtu Financial, crypto rm Galaxy Digital and trading rm Jane Street, all based in New York.

e timing of Cboe’s acquisi tion wasn’t good. It struck the deal to buy all of ErisX (Cboe had been a minority investor before) more than a year ago.

e deal closed in May, just as the value of bitcoin and other tokens plummeted in the wake of the collapse of TerraUSD, a so-called stablecoin meant to preserve value when the price of other more vola tile cryptocurren cies uctuated.

In the second quarter, Cboe took a non-cash write-o of $460 million tied to the purchase of ErisX. It hadn’t disclosed the terms of the deal, but the write-o clear ly was well over half of the plat form’s value based on other dis closures Cboe had made.

Co-founders of ErisX includ ed DRW, the trading rm run by Chicago’s Don Wilson, and Virtu Financial, a direct competitor of Ken Gri n’s Citadel Securities, in market-making, mainly for stocks.

Both are investing yet again, seemingly at a much lower val

uation than the one at which they just sold, since it came after Cboe wrote o so much of the value of the business.

Asked about that, DRW didn’t answer directly. In an emailed statement, it said, “Recent events in crypto have underscored the importance of institutional li quidity and regulated platforms to support trading of this asset class. DRW has long recognized and championed this thesis with the founding of ErisX, and we are

excited to continue to support Cboe Digital in furthering this vision.”

Cboe said it wasn’t disclosing that kind of detail on the invest ments.

Jump and DRW, which both are signi cant crypto traders, said in the aftermath of the FTX collapse that their exposure to FTX verged from virtually non existent (DRW) to being “man aged in accordance with our risk framework” (Jump).

Sam Zell

THE PARTICIPATION IN CBOE’S ENTERPRISE IS MEANT AT LEAST IN PART TO DEMONSTRATE CONFIDENCE IN THE FUTURE OF CRYPTOCURRENCIES DESPITE A DISASTROUS YEAR.

BLOOMBERG

An old schoolhouse that rocks in Humboldt Park

Built next to a Polish church in 1896 as the Szkola Dobrego Pasterza, or Good Shepherd School, it’s been residential since the mid-1980s. The price is $1.35 million. I BY DENNIS

After two and a half decades living in the former Good Shepherd School in Humboldt Park, Jeff Atkins isn’t sheepish about calling the building “a magical place.”

Over the years, his family of three has combined home, office, studio and tricycle-riding space in the red brick school building on Cortez Street. They’ve read books while basking in the sun coming in through tall south-facing windows and hosted rehearsals and recording sessions in their 1,000-square-foot perfor mance studio.

“The first time we saw this building, I thought we could use all these big, super-cool spaces,” Atkins says.

“And we have,” his wife, Aggie Gadacz-Atkins, says. Completed in 1896 and originally part of a threebuilding campus that also included a church and a rectory, the building still has its Polish name, “Szkola Dobrego Pasterza,” or Good Shepherd School, carved in stone over the front door. Roughly 9,000 square feet and set about 45 feet back from the street, it’s been residential since the mid-1980s. It’s essentially six very large rooms, each about 22 feet wide by 51 feet deep, two per floor including in the raised basement.

The couple are now moving to Mishawaka, Ind., near where they both grew up in South Bend. They put the house on the market Nov. 30. Represented by Ken Dooley, the home is priced at $1.35 million.

RODKIN

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