Crain's Chicago Business

CSO: How the orchestra is finding its way during the pandemic. PAGE 3

NOTABLES: These HR leaders rose to 2020’s challenges. PAGE 15

CHICAGOBUSINESS.COM | FEBRUARY 1, 2021 | $3.50

Why banking isn’t working right now for Chicago’s largest bank Making loans and collecting deposits isn’t where the money is

BY STEVE DANIELS Trust. After all, the S&P 500 improbably returned 16 percent; Northern is one of three global titans making most of its money managing and safeguarding assets for investors, and much of its fee revenue is tied to the values of those investments.

But Northern also is a bank after all—the largest one headquartered in Chicago. And the bread and butter of banking—collecting depos-

its and making money from them by lending— proved an albatross. A 14 percent decline in net interest income, the money Northern made on its deposits, led to a 19 percent decrease in net income overall. It was Northern’s worst oneyear performance since 2010, when net income fell 23 percent.

See NORTHERN on Page 30

Walgreens’ new CEO has plenty to learn

BY ALLY MAROTTI When Roz Brewer takes over as CEO of Walgreens Boots Alliance on March 15, she’ll face some familiar challenges and others that will stretch her skills.

The former chief operating officer of Starbucks and onetime boss of Walmart’s Sam’s Club chain knows how to reshape and dig-

Is this Joliet plan a bridge to nowhere?

A NIMBY spat over a link to two massive rail yards could be a turning point for the region

JOE CAHILL Who’s really going to be in charge at Walgreens? PAGE 4 itize a retail chain, top priorities for Walgreens. Her track record is spottier when it comes to delivering consistently strong growth, a crying need for Walgreens.

Perhaps the most notable résumé gap is her lack of experience in health care. She’ll inherit predecessor Stefano Pessina’s plan to transform the Deerfield-based chain’s 9,000 drugstores into “neighborhood health destina-

BY ALBY GALLUN GETTY IMAGES

Brewer fills in some of the company’s blanks, but not all of them

JOHN R. BOEHM

2020 SHOULD HAVE BEEN A GOOD YEAR for Northern

Roz Brewer tions,” offering doctor’s appointments and other medical care. It’s a dramatic transformation that will take Walgreens and its new See WALGREENS on Page 12

U.S. Rep. Bobby Rush calls it “the bridge to the future.” To many Will County officials and residents, it’s a bridge too far. But the opinion that really matters now belongs to Gov. J.B. Pritzker.

The fate of a massive industrial park planned in Joliet that could employ as many as 10,000 people rests largely in the hands of the governor, who has the final say over a proposed bridge

spanning Route 53 that’s essential to the development. It may be just a bridge, but it represents the hopes of pro-growth government officials and the fears of local residents fed up with heavy truck traffic originating from a pair of gigantic rail yards nearby.

And the outcome of the standoff could be a turning point for a region that’s become one of the nation’s largest logistics hubs and, See JOLIET on Page 28

NEWSPAPER l VOL. 44, NO. 5 l COPYRIGHT 2021 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

P001_CCB_20210201.indd 1

GREG HINZ

CHICAGO COMES BACK

Deputy mayor wouldn’t bet against Chicago’s recovery. PAGE 2

Words are powerful.

Business leaders should choose them wisely. PAGE 4

1/29/21 4:35 PM

GREG HINZ ON POLITICS

Betting against Chicago?

Not this guy. the expensive Bay Area for cheaper Chicago. And the city remains an attractive venue for headquarters for companies such as Nielsen, which moved its consumer research HQ here from New York.

But what about all those near-empty downtown office towers, as United Airlines and others pare way back? This trend will pass, Mayekar replies.

But, just in case, he’s quietly put together a big-name working group that will focus not on diversity and South Side growth but how to help downtown survive a very, very rocky stretch.

Crucial to helping downtown—and reeling neighborhood retail corridors throughout Chicago—is shoring up the city’s showplace but now dying North Michigan Avenue.

“We are deeply committed to the success of the Magnificent Mile,” Mayekar says. But he only gives hints as to how, talking about creativity and attracting more pedestrian traffic and the like.

Hard as all of the above is to achieve, probably the most challenging task is remaking the city’s image after a year of illness, looting, public school chaos, huge tax hikes, carjacking mania and more. The effort is especially critical to the convention and tourism sectors, a huge source of employment and tax revenue, but that won’t work if “IN THE LONG RUN, THE FUTURE one people are scared to come here.

OF CITIES IS GREAT.” Some of those perceptions will change when the with mental health issues that city’s new marketing officer, underlie so many of the city’s Michael Fassnacht, starts to chronic problems, investing in do his thing—soon—Mayekar industries that are poised for says. Other progress will arrive growth and plain old marketing, when the state hopefully aka rebranding and buffing Chirelaxes COVID restrictions in cago’s international image. the second half of the year and On the mental health front, large gatherings once again much spade work now has can be held. Mayekar says been done on establishing a officials expect and are work211 phone system, one that will ing toward “hybrid” events allow Chicagoans to summon that operate both in person or help rather than people with remotely. guns, Mayekar says. He sugUltimately, though, you just gests it could go live not far into have to believe, he concludes— next year. believe that the magic that With industries, the city has made Chicago and other big shown some decent momentum in luring life sciences facil- cities work for centuries still has ities, he says, pointing to recent potency. “Certain cities now are facing unprecedented probdevelopments in the Lincoln lems,” he says. “But in the long Yards and Michael Reese proprun, the future of cities is great.” erties. Chicago-based Uber And a bet against Chicago Freight was able to attract $500 recovering “is a bet I wouldn’t million in new financing last want to take.” fall, pandemic or not, Mayekar For all our sakes, I hope he’s notes, citing recent stories that right. some young techies are fleeing At a time when much of Chicago’s business community is stunningly pessimistic—“I am hearing more and more about people leaving the city and state,” confides one veteran business leader—there is one unremitting source of sunshine in the house. That’s Samir Mayekar, deputy mayor for neighborhood and economic development, and the person who more than anyone else is in charge of guiding the city’s economy to the far side of COVID-19.

In a phone interview, Mayekar doesn’t disappoint. With a new, more urban-friendly president in office and vaccines beginning to arrive with regularity, the 37-year-old onetime tech entrepreneur sees “a renewed sense of optimism.”

Still, despite his solid reputation, Mayekar is only one man in a Lightfoot administration that on so many fronts seems to be fighting for its very life right now. He and the administration have lots of plans. But there also are lots of unfilled blanks.

Overall, the city is making progress on all main goals laid out in the COVID-recovery plan it unveiled last summer, when the pandemic seemed to be receding rather than building toward another peak. He mentions three in particular: dealing

CORRECTION Financial-tech veteran Julie Armstrong’s surname was misstated in a Jan. 25 article about Chicago-based Enfusion.

P002_CCB_20210201.indd 2

Ken Griffin, welcome to the white-hot national spotlight

BY STEVE DANIELS Ken Griffin is well known to Chicagoans as the founder of Citadel, a leading philanthropist and an active presence in local politics. In the rest of the country outside of financial circles, his profile is considerably lower.

That’s about to change.

Griffin and Citadel are playing a lead role in the national drama over Redditeers, retail investors converging over the website to squeeze hedge-fund short sellers by mass buying of beaten-down stocks as well as suspicions that trading halts in those stocks by popular online trading platforms like Robinhood were designed to rescue the hedge-fund class.

Griffin is highly likely to find himself a witness in congressional hearings to come on the controversy. He will have to answer questions about Citadel’s decision to rescue a fellow hedge fund that was caught in the intense short squeeze of GameStop, a brick-and-mortar retailer of video games.

Sen. Sherrod Brown, D-Ohio, the incoming chairman of the Senate Banking Committee, last week said he would hold at least one hearing. “People on Wall Street only care about the rules when they’re the ones getting hurt,” he said in a statement.

“American workers have known for years the Wall Street system is broken—they’ve been paying the price. It’s time for the SEC and Congress to make the economy work for everyone, not just Wall Street.”

Rep. Maxine Waters, D-Calif., later said the House Financial Services Committee, which she

BLOOMBERG

2 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

Ken Griffin chairs, also would investigate.

“As a first step in reining in these abusive practices, I will convene a hearing to examine the recent activity around GameStop stock and other impacted stocks with a focus on short selling, online trading platforms, gamification and their systemic impact on our capital markets and retail investors,” she said in a statement.

“We must deal with the hedge funds whose unethical conduct directly led to the recent market volatility and we must examine the market in general and how it has been manipulated by hedge funds and their financial partners to benefit themselves while others pay the price.”

IN THE HOT SEAT

So far, neither Brown nor Waters has set a hearing date or identified witnesses they want to hear from. But it’s hardly a leap to believe Griffin will be on the hot seat in at least one chamber.

Among the members on the House panel are local Democrat-

ic Reps. Chuy Garcia, Sean Casten and Bill Foster. Progressive firebrand Alexandra Ocasio-Cortez of New York, who has proved to be a formidable questioner in past hearings, also is a member.

Additionally, the anger and suspicion over the sudden halt in trading Jan. 28 is bipartisan. Texas Sen. Ted Cruz tweeted that he agreed with AOC about the need to probe.

Griffin and Citadel have played a starring role in the complaints voiced on Reddit by the new “stock jockeys,” as hedge-fund manager and New York Mets owner Steve Cohen derisively referred to them in a tweet last week. They’ve noted, too, the attention from both sides of the aisle.

One example from a Reddit poster called “dust”: “A nerve has been struck. When Ted Cruz, AOC, (Arizona Republican Rep.) Paul Gosar, and reddit shitposters agree, maybe we really are entering the Age of Aquarius.”

A spokeswoman for Citadel says Griffin would have no comment on the prospect of having to appear before Congress. But both companies owned by Griffin—Citadel itself (the hedge fund) and Citadel Securities (which processes trades for online platforms like Robinhood)— deny having anything to do with the decisions to halt trading in GameStop and other stocks whose prices were bid up by the Redditeers.

“Citadel Securities has not instructed or otherwise caused any brokerage firm to stop, suspend, or limit trading or otherwise See GRIFFIN on Page 8

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1/29/21 5:23 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 3

More are uninsured.

Charity care is down.

David Taylor is a violinist and assistant concertmaster with the Chicago Symphony Orchestra.

The decrease adds fuel to a debate over nonprofit hospitals’ tax breaks

BY STEPHANIE GOLDBERG

“IT’S KIND OF BASED ON THE OLD-FASHIONED PRINCIPLES OF STAYING CONNECTED WITH YOUR FAMILY.”

CSO—after all, their very raison d’etre is assembling before throngs in now-dark performance halls.

Some orchestras have shuttered for the duration (Indianapolis and Nashville, Tenn.) or tried to ditch their collective bargaining agreement (Colorado Springs, Colo.).

Others have negotiated pay cuts that extend for years. The nation’s largest performance company, New York’s Metropolitan Opera, has stopped paying musicians and locked out stagehands in a labor dispute that has drawn a rebuke from the CSO music director Riccardo Muti.

The amount of charity care provided by the area’s biggest hospitals edged down at a time when more people are losing the health insurance they need to pay for treatment.

Free care for low-income patients represented less than 2.5 percent of net revenue for all but one of Cook County’s largest hospitals in 2019, according to newly released state data. The exception: County-run Stroger Hospital spent just over half its revenue on free care—not including bad debt, which is billed but not recovered in full.

“Hospitals that are rich and charge a lot provide very little charity care,” says Gerard Anderson, a professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health. “Hospitals that are poor and don’t charge as much provide proportionally more.”

Collectively, the largest area hospitals saw charity care expenses fall 1 percent as revenues rose 3 percent in 2019, compared with the previous year. The pre-pandemic figures add fuel to the debate over whether nonprofit hospitals are providing enough charity care to justify property tax exemptions worth hundreds of millions of dollars. Activists say wealthy hospitals should do more, alleviating the disproportionate burden on Cook County’s public health system and other safety nets at a time when

Helen Zell, chair of the symphony board

See CSO on Page 12

See CHARITY CARE on Page 29

How the CSO is finding its way during the pandemic Forget searching for new sources for fundraising.

The symphony's secret sauce is leaning on its loyal donor base.

DAVID TAYLOR, A VIOLINIST and assistant concertmaster for the Chicago Symphony Orchestra, has tried to remain professionally engaged during the pandemic. There was a summer music festival in Carbondale, a virtual Bach solo for an Illinois Institute of Technology event in December and a recital at a west suburban retirement home somewhere along the way.

In November, he and other string players performed Mozart’s “Eine Kleine Nachtmusik” for the symphony’s startup, CSOtv. That’s been Taylor’s sole CSO gig in almost a year.

Few organizations are as exposed to COVID-19’s financial vise as performing arts groups like the

JOHN R. BOEHM

BY STEVEN R. STRAHLER

United looks abroad for post-pandemic profit boost COVID took a toll on international rivals, clearing the way for fare hikes The coronavirus pandemic is reducing competition on some of United Airlines’ international routes, pointing the way to greater profits when people start flying overseas again.

In the short term, demand will be greatest for domestic flights as people visit friends and family or take vacations. But as the industry looks toward a return

P003_CCB_20210201.indd 3

to normal travel levels, perhaps in 2022 or 2023, United believes international flying will be the more lucrative proposition.

“We expect international profits will return quicker and stronger than domestic,” Andrew Nocella, United’s chief commercial officer, told analysts when the company reported year-end results Jan. 21. “In the last cycle, domestic margin performance was clearly above

international, and we expect domestic margins may be under some pressure at the beginning of this next post-COVID cycle.”

Bankruptcies and consolidation, which swept the U.S. aviation industry in the 2008 recession, have struck overseas carriers this time around.

“We can identify over a dozen failures around the world to See UNITED on Page 29

UNITED AIRLINES

BY JOHN PLETZ

Less competition would give United more pricing power on international routes.

1/29/21 4:09 PM

4 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

JOE CAHILL

CHICAGO COMES BACK

ON BUSINESS

office, and run something by him, especially if they don’t like what she said,” says professor Erik Gordon of the University of Michigan’s Ross School of Business.

Of course, a new CEO often asserts authority by appointing her own leadership team. If Brewer replaces the current C-level officers, it will be a sign that Pessina is letting her take charge.

I understand why Pessina wants to retain influence. As Walgreens’ largest shareholder, he has a lot riding on its performance. But his 16 percent stake in Walgreens means he’ll always have the CEO’s ear. It doesn’t justify intruding on her turf.

Overlapping power centers can spawn operational disarray.

Paralysis often ensues when underlings aren’t sure who calls the shots. Competing fiefdoms sometimes arise, sparking factional fighting among managers loyal to different leaders.

That’s the last thing Walgreens needs, especially now. Profit margins are shrinking and customer traffic dropping as its traditional business model comes under attack. Walgreens’ stock is down 33 percent since Pessina A WELL-DEFINED CHAIN OF COMMAND took over in 2015, while the broader ENDING WITH THE CEO IS ESSENTIAL. stock market rose 86 percent.

Pessina is trying to turn the and the board of directors.” company around with a massive Traditionally, a CEO sets strategy shift. He aims to turn company strategy. So who has Walgreens’ 9,000 U.S. stores into the final word on Walgreens’ what he calls “neighborhood strategy: Pessina or Brewer? A health destinations” offering company spokesman says they’ll doctors’ appointments and other “work together.” medical care.

As for the new CEO’s role, WalIt’s an immense transforgreens says Brewer will “focus on mation requiring coordinated driving long-term shareholder effort across the organization. A value and ensuring that the comwell-defined chain of command pany is continuously evolving to ending with the CEO is essential meet the changing needs of our to keeping such a project on track. customers through innovation Transforming thousands of and digital transformation.”

Walgreens stores into medical Along with Pessina, Walclinics would cost billions of greens’ C-suite includes two dollars on top of the $1 billion co-COOs who have strong ties to Pessina already has committed the Italian-born billionaire. Alex to the project. At some point, Gourlay rose through the ranks somebody will have to decide if at Alliance Boots, the European it’s worth investing those addipharmacy company Pessina tional billions. Will it be Brewer’s built before merging it with call, or Pessina’s?

Walgreens in 2015. Ornella Barra Presumably, Brewer wouldn’t is both a longtime Pessina lieuhave left a prestigious post as tenant and his significant other.

COO of Starbucks if she doubted Throw in Walgreens President Pessina’s strategy. As CEO, she’ll John Standley, the former CEO be responsible for carrying it of pharmacy chain Rite Aid, and out. And she’ll take the fall if it you start to wonder where the doesn’t pan out. Yet she may company will find office space not have full power to adjust the for Brewer. strategy, or to pull the plug if she What’s clear is that she’s joinconcludes it isn’t working. ing an upper management team Walgreens needs a leader shaped by, and likely loyal to, who’s both accountable for Pessina. Establishing herself as results and fully empowered to their boss will be a challenge. deliver them. If Pessina really “It will be very easy for a believes in Brewer, he’ll step Walgreens executive who’s been aside as executive chairman and working for Pessina to walk into let her lead the company. his office after walking out of her

If Stefano Pessina wants Roz Brewer to succeed, he should get out of her way.

Pessina will hand Brewer the CEO title at Walgreens Boots Alliance on March 15, but he’s not giving up all his power. In his new role as executive chairman, he’ll retain considerable say in big decisions at the Deerfield-based drugstore chain.

Pessina’s continuing presence in senior management sows doubts about Brewer’s authority.

When an outgoing CEO hangs around in an executive role, fundamental questions arise about who’s in charge and who’s accountable for the company’s performance. The arrangement also suggests a lack of confidence in a new CEO. Walgreens hasn’t publicly delineated the respective powers of Pessina and Brewer. When the company announced in July that Pessina would become executive chairman after a new CEO came aboard, a spokesman said he would “continue to play a key role in developing the strategy of the company, along with the new CEO, his or her leadership team

P004_CCB_20210201.indd 4

Use your words, and use them carefully

ALAMY

Who’s really going to be in charge at Walgreens?

Dynamic speakers like Martin Luther King Jr. remind us that words have the potential to transform us. What business leaders say comes with great responsibility.

BY EMILY DRAKE AND TODD CONNOR Chicago Comes Back is a weekly series on ChicagoBusiness.com providing leadership insights to help your business move forward, written by leadership consultants Emily Drake and Todd Connor.

Drake and Connor facilitate Crain’s Leadership Academy. Drake is a licensed therapist, owner of the Collective Academy and a leadership coach. Connor is the founder of Bunker Labs and the Collective Academy and is also a leadership consultant.

Check out previous installments at ChicagoBusiness.com/comesback.

TODD CONNOR: Honoring Martin Luther King Jr.’s legacy this month really brought to the forefront the transformational ability that language can have. King was the 16th of 18 speakers at the March on Washington on Aug. 28, 1963, and yet his speech immediately captured the imagination of Americans for what the L.A. Times called its “matchless elegance.”

With lines recalled including, “We refuse to believe that the bank of justice is bankrupt,” he did linguistically what legislation or action alone could not achieve.

EMILY DRAKE: The power of his words indeed resonate today, both for what they achieved and for what still needs to be done. He leveraged familiar texts, including the Emancipation Proclamation and the Bible, but elevated them to new purposes. He reminded us, “Let us not seek to satisfy our thirst for freedom by drinking from the cup of bitterness and hatred.” It’s hard now not to see the irony and the sadness of his speech, given almost 60 years ago on the National Mall, in the same place where this month’s assault on the U.S. Capitol unfolded, or in the context of the speech that was given by President Biden.

Words—I think we can agree, and as we are sometimes violently reminded—have consequences.

Leaders, more than simply making business decisions, create a reality through their words. We hear an understanding of what is, and also what can be. That’s a responsibility not to be taken lightly.

TC: Interestingly, the Johnson O’Connor Research Foundation has tracked thousands of successful people from all fields, industries and disciplines to uncover the traits that successful people share. In spite of the volumes of self-help literature on the topic, their research uncovered only one common trait that was consistent with successful people: they have all acquired a large vocabulary. Founder Johnson O’Connor described it this way: “The final answer seems to be that words are the instruments, by means of which men and women grasp the thoughts of others and with which they do their own thinking. They are the tools of thought.”

ED: It’s a fascinating consideration, this idea of vocabulary and a strong lexicon as being facultative to the craft of leadership. Certainly, as the daughter of a retired Chicago Public Schools English teacher, I can get behind this hypothesis. King’s words, the words of others tethered to social justice movements and even the words of the Fortune 500 leaders and the scrappy entrepreneurs who lead their teams create worlds into which we discover ourselves and the environment around us.

One study of speeches of business leaders, sampling 10,000 words, found that Apple CEO Tim Cook had the second-largest vocabulary, using around 2,209 unique words; Facebook CEO Mark Zuckerberg clocked in at 1,457 unique words per 10,000. (No. 1 was media mogul Rupert Murdoch at

2,256.) Also on the list: Ulta CEO Mary Dillon (1,848); Ventas CEO and Economic Club of Chicago chair Debra Cafaro (1,631); and Walgreens CEO Stefano Pessina (1,498).

TC: The words we use, both the variety and the volume of them, is interesting to consider, even if our analysis is not complete or scientific. The past year in particular we have had to learn a number of new words. Just think about some of the things that are new to our linguistic repertoire: COVID, social distancing, Zoom fatigue, doomscrolling, super-spreader, walktails, contact tracing, or maskne (I had not actually heard this one). And then a number of other words have been added this year to the Oxford Dictionary, including nomophobia, which is the anxiety of not having access to your mobile phone; or omnishambles, which is applied in a political context as a situation that has been comprehensively mismanaged. Cryptocurrency is now officially a word, as is chillax, meaning to calm down. The word whatevs expresses indifference—a word that no doubt came in handy this year.

ED: So, words matter, and the words that leaders choose and deploy matter. As we come into the new year, it might be worth leaders reflecting on the words they have access to and to be intentional in using words to elevate spirits, to create moral clarity and belonging or to invite decisive action. Perhaps in 2021 we can create new words, such as the first time we get to finally see and hug a colleague at the office having both received the vaccine—perhaps that’ll be a backccine reunion? Our use of language is the primary arrow in our quiver. We would be well served to use it with great consideration.

1/29/21 12:06 PM

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6 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

w HOW DID YOUR NEIGHBORHOOD’S CONDO MARKET DO IN 2020?

The chart below tracks prices for attached housing (condos as well as townhouses, though the great majority is condos) in city neighborhoods. Neighborhoods are included only if they had 25 or more attached-home sales during each of the years.

D’APRILE PROPERTIES

Neighborhood

Median price (2020) Percentage change from 2019

Jefferson Park

$150,000

-11.8%

North Park

$214,251

-6.8%

South Shore

$65,000

-4.4%

Avondale

$365,000

-1.4%

Bridgeport

$289,483

-1.2%

Clearing

$126,000

-1.0%

Norwood Park

$174,900

-0.1%

Loop

$330,000

0

North Center

$447,000

0.7%

Rogers Park

$177,000

1.1%

Near West Side

$370,000

1.4%

Logan Square

$418,000

1.5%

Austin

$125,750

1.8%

Lincoln Park

$515,000

2.1%

Hyde Park

$199,900

2.5%

In this building on Cornell Avenue in Hyde Park, a three-bedroom condominium sold in September for $399,900.

West Ridge

$148,894

2.7%

Here’s how your neighborhood’s condo market fared in 2020

Edison Park

$170,000

3.0%

Crain’s exclusive look at price movement in condos and townhouses last year

BY DENNIS RODKIN The downtown condo market took a blow in 2020, as homeowners who were able to fled from density and its feared connection to the spread of coronavirus.

Farther out from the city core, the condo market hummed, thanks in part to low interest rates that turned many renters into buyers.

That shows up in the price figures in Crain’s chart of neighborhood condo markets: In the Loop, the median price of condos sold was flat from 2019 into 2020, and in the three neighborhoods that ring the Loop, growth was shallow: 1.4 percent on the Near West Side (an

official designation that encompasses the West Loop and nearby areas), and 3.8 percent on the Near South and Near North sides.

The chart tracks prices for attached housing (condos as well as townhouses, though the great majority is condos) in city neighborhoods. Neighborhoods are included only if they had 25 or more attached home sales during each of the years.

The data is provided to Crain’s exclusively by the Chicago Association of Realtors, Midwest Real Estate Data and Showing Time.

On another measure, which is not detailed in the chart, the downtown neighborhoods were

hit harder. The number of condos sold during the year plunged in all four, from a decline of more than 9 percent on the Near South Side to a drop of more than 23 percent in the Loop, the epicenter of 2020’s shutdown of offices and attractions and of social justice protests.

It was a different story in neighborhoods that are distant from the city’s core. The median sale price of condos grew by 10 percent or more in Edgewater, Grand Boulevard, Hyde Park and Woodlawn, among others.

All told, the median price of condos sold in the entire city during the year was up 5.6 percent from 2019.

SEE DATA FOR SINGLE-FAMILY HOMES IN CITY NEIGHBORHOODS AND SUBURBAN HOUSING AT CHICAGOBUSINESS.COM/RESIDENTIAL-REAL-ESTATE

Near North Side

$410,000

3.8%

Near South Side

$385,000

3.8%

West Town

$500,000

4.3%

Albany Park

$210,450

5.3%

Dunning

$210,000

5.3% 5.9%

Lower West Side

$429,900

Uptown

$300,000

7.3%

O’Hare

$145,000

7.4%

Irving Park

$231,250

10.4%

Portage Park

$170,000

10.4%

Woodlawn

$195,000

12.1%

Grand Boulevard

$237,500

13.1%

East Garfield Park $162,250

13.5%

Douglas

$149,900

13.6%

Edgewater

$245,000

16.1%

Belmont Cragin

$208,000

18.5%

Lakeview

$415,000

18.6%

Armour Square

$320,500

19.2%

Oakland

$328,000

Washington Park

$185,000

26.2% 97.9%

Note: The median price is the midpoint of all homes sold during the year. The change in the median may be distorted by heavier buying at one end of the price ladder or the other, but provides a general measurement for comparing one location to another.

Sources: Chicago Association of Realtors, Midwest Real Estate Data and Showing Time

Lincoln Park penthouse sells for $9 million

BY DENNIS RODKIN A penthouse at the top of a Lincoln Park condo tower sold for $9 million, the highest sale price on record for a Chicago condo in almost two years.

It’s the priciest sale of the year so far, topping the Hinsdale mansion that went for almost $7.7 million Jan. 15. The last time a condo in Chicago or the suburbs sold for more was in March 2019, when a buyer paid a little under $11.3 million for a unit on Walton Street.

The Lincoln Park condo, on the 38th and 39th floors of a French-derived condo tower built in 2010, was listed in July at $13 million. The sale price is just under 70 percent of what sellers Dan and Megan O’Keefe were asking.

The sale closed Jan. 15, but the listing

P006_CCB_20210201.indd 6

agent, Pam Rueve of Jameson Sotheby’s International Realty, did not put it in real estate records until Jan. 26. Neither the O’Keefes nor Rueve immediately responded to requests for comment.

The couple bought the space unfinished in 2015 for a little more than $6 million.

When Crain’s featured the property in July, the O’Keefes declined to say what they spent to finish the space into a five-bedroom home.

Architects at Wheeler Kearns designed the space with Venetian plaster walls, white oak flooring, walnut paneling and built-ins, and a hefty metal staircase that stands like a sculpture at one end of the main living space. The outer walls lean in because the space is inside the inward-tilting mansard roof designed by the tower’s architect, Lucien Lagrange.

Ten-foot-high windows across the east side of the condo look over the park and Lake Michigan, and on the south, into the skyline.

The O’Keefes said in July that they planned to live full time in California and get a smaller Chicago place for part-time use.

JAMESON SOTHEBY’S INTERNATIONAL REALTY PHOTOS

It’s the highest sale price in almost two years for a local condo

1/28/21 5:00 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 7

Chicago private-equity firm buys leading HR outsourcer Tandem, Illinois’ largest professional employer organization, will serve as Shore Capital Partners’ platform to consolidate the industry in the Midwest

BY STEVE DANIELS Illinois’ largest human-resources outsourcing firm, Tandem HR, has sold to a Chicago-based private-equity firm that wants to build the Midwest’s biggest player in the growing field.

Shore Capital Partners’ acquisition values Tandem at more than $60 million. Shore is pumping more than $30 million of equity into the company, making it a platform to tack on privately held firms in other Midwestern markets. Founder and CEO Bruce Leon, 59, who owned 100 percent of Tandem, is staying on and will play an important role in striking deals with smaller firms.

Already, Shore has acquired professional employer organizations, or PEOs, in Detroit and St. Louis.

“We’ve got a pipeline of six or seven others,” Leon says.

Tandem, founded in 1998, handles human resources for mid-

far in the middle of the country provides opportunity for Tandem and Shore Capital. For entrepreneurs like Leon who are ready to cash out, Shore Capital is positioning Tandem as a softer-touch acquirer than bigger-money players—the same sales pitch that appealed to Leon.

“We loved this idea of a Chicago company” that would consolidate

PEOs in the Midwest, Leon says.

For Shore Capital, the acquisition of Tandem is from its third and largest fund, totaling $290 million. “It’s one of our larger investments to date,” says Ryan Kelley, a founding partner of Shore Capital. Shore has amassed more than $1 billion in assets under management since its 2009 launch.

COVID has proven to be a boon for HR outsourcing firms, Leon says. Tandem’s revenue was up 30 percent in 2020; fees it collected for its work totaled about $25 million.

Privately held companies that previously wanted to keep human resources in-house now are far more open to outsourcing, with offices largely empty and employees working from home, Leon says. He expects that trend to continue at least through 2021.

Leon already had handed off much of the day-to-day management of Tandem to President Salo Doko and Chief Financial Officer Tanya Yakhnis before the Shore Capital deal. He intends to focus on strategy and dealmaking and will transition to a vice chairman role in a year, he says.

Bruce Leon

...

TANDEM, FOUNDED IN 1998, HANDLES HUMAN RESOURCES FOR MIDSIZE, OFTEN FAMILY-OWNED COMPANIES THROUGHOUT ILLINOIS, AS WELL AS OTHER MIDWESTERN STATES. size, often family-owned companies throughout Illinois, as well as other Midwestern states. It has a significant partnership with Blue Cross & Blue Shield of Illinois in which it’s able to offer health insurance to employees of those companies for which it runs benefits and HR.

MIDWEST OPPORTUNITIES

Leon says his company had been barraged with offers from publicly traded giants in its industry and other private-equity firms. The Shore Capital deal will keep Tandem in west suburban Westchester. Tandem employs 127 and hopes to grow to up to 300 in the Chicago area, he says. Companies that have hired Tandem to run HR and other functions like payroll collectively employ 14,200.

The HR outsourcing industry, Leon says, remains highly fragmented in the Midwest while dealmaking has been active elsewhere. “We’re way behind places like California, the Southeast and Texas,” he says.

“We’ve got to get the Midwest going.”

The lack of consolidation so

P007_CCB_20210201.indd 7

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8 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

Census delays throw a wrench in Illinois remap sibilities fall to an eight-person, bipartisan commission selectDelays in census data mean ed by the state’s four legislative that Springfield Democrats may leaders.

The prospects of a remap lose the power to draw new state legislative and congressional going to a bipartisan commisdistrict lines, sending the pro- sion is looking likely, says Ryan Tolley, policy director at Change cess to a bipartisan panel.

The U.S. Census Bureau an- Illinois, where he leads advocacy nounced Jan. 27 that data for efforts for good-government rethe 2020 census, which is used form. A remap commission has to reapportion congressional been convened only four times seats across states, won’t be since 1970, and they’ve typically available until the end of April, been messy.

In three of those instances, four months later than usual.

That means mapmakers in Illi- the panel couldn’t agree to a plan and was forced to “randomly select the THE TIMING WILL LEAD TO tiebreaker, either giving UNCERTAINTY FOR PROSPECTIVE Democrats or Republicans control over the final CANDIDATES IN 2022. map,” Tolley says.

“The one time they nois likely won’t get their hands did come to agreement, it was on the data they rely on to draw when legislative leaders in 1971 boundaries for Congress—as appointed themselves to be well as their own seats—until af- backup commissioners. Then it was found unconstitutional,” he ter July 30, and possibly later.

The delay could have serious says.

New Jersey has already opted implications for Democrats’ future hold on power and the 2022 to put off redistricting over the elections. Redistricting maps, census delay. In Virginia, which crafted once every 10 years usu- has primary elections in June, ally by the party in power, must the state will use a bipartisan be submitted no later than July commission for the first time, ac30 under the state’s constitution. cording to the Associated Press.

Lawmakers in Illinois could Otherwise, mapmaking respon-

BY A.D. QUIG

try using old data, but court challenges loom over some solutions.

Jim Lewis, a senior researcher at the University of Illinois at Chicago who oversaw remap work the Chicago Urban League did on behalf of Black communities in the 1990s, says he’d be “surprised if leadership allowed the process to go to the commission.” A new map could be made with other census data, including from the American Community Survey. But that map could be “legally contested once the new block-level data is released in the fall.”

John Patterson, spokesperson for Illinois Senate President Don Harmon, says “we continue to monitor the situation.”

Regardless of how the map is drawn, the timing will lead to uncertainty for prospective candidates in 2022.

LOOMING DEADLINES

If the Census Bureau delivers numbers in early August, mapmakers will face a quick turnaround. The process to complete the map typically takes a couple of months, but candidates need to submit petitions to qualify to make it on the ballot between the end of August and mid-No-

BLOOMBERG

The state likely won’t meet its constitutionally set deadline to submit redistricting maps, potentially stripping Springfield Democrats of their coveted power to draw their own fate

vember, according to the Illinois State Board of Elections. Without a map, candidates won’t be able to gauge their viability, know what their districts look like, or even know which doors to knock on.

“We are in a bind,” says Jay Young, executive director of Common Cause Illinois. “The idea that we can draw maps in time to allow folks, even incumbents, to sort of get their campaigns in gear, is just really difficult.” He predicts lots of scrambling to come in Springfield.

A spokesperson for House Speaker Chris Welch did not immediately respond to a request for comment.

Aldermen are just beginning to mull the redistricting process.

The City Council’s deadline to draw wards for 2023 elections is December. Ald. Brian Hopkins,

2nd, and Ald. Andre Vasquez, 40th, last week called for hearings to begin on how to make Chicago’s remap process more transparent and equitable.

Meanwhile, Latino elected officials, including the City Council’s Latino Caucus, held a press conference advocating for a “parity map” that “is fair to all Chicagoans and accurately reflects the growing Latino community and their contributions to Illinois,” saying they would not support an “independent redistricting commission” chaired by “individuals who don’t live or work in our Latino communities.”

Mayor Lori Lightfoot has stayed relatively quiet on her vision for a remap process, but said Jan. 27 that the “relic of having ward boundaries drawn in a backroom is just that, a relic of the past.”

Here’s how much Chicagoans profited selling homes in 2020

Ken Griffin, welcome to the white-hot national spotlight

On average, Chicago sellers profited more than a year earlier, but it was still below proceeds for sellers in all the rest of the nation’s 10 biggest cities

refuse to do business,” she says in an email. “Citadel Securities remains focused on continuously providing liquidity to our clients across all market conditions.”

Citadel Securities processes more of Robinhood’s trades than any other market maker.

Robinhood said Jan. 29: “To be clear, this was a risk-management decision, and not made on direction of market makers we route to.” The company raised $1 billion in equity from existing shareholders to boost liquidity as it began to resume trading in GameStop and other stocks Jan. 29.

Also raising eyebrows was Griffin’s decision earlier in the week to help rescue fellow hedge-fund manager Gabriel Plotkin, whose Melvin Capital Management suffered losses of at least 30 percent due to its heavy short position in GameStop. Citadel and Griffin provided $2 billion for Plotkin’s fund, combined with $750 million from Cohen, who already was a participant.

In return, Citadel and Griffin will get a regular piece of Melvin’s future fee revenues in addition to its share of whatever gains the

The supercharged housing market in 2020 delivered Chicago-area home sellers the most profit since 2007, according to a new report.

On average, Chicago-area sellers received $47,000 in proceeds after the sale, according to data released Jan. 27 by Attom Data Solutions, a nationwide property information service. That’s an increase of $10,000 from the average return on investment in 2019.

Attom reports a gross figure, the difference between what sellers paid for their home in the past and what they sold it for in 2020.

It is not a net figure, which would include any investment in renovation or upgrade over the years.

Nevertheless, it’s a handy general gauge of how sellers make out.

The more sellers profit, the more they are able to afford to use as a down payment on their next home, an especially important consideration in 2020 when home

P008_CCB_20210201.indd 8

prices were rising sharply.

Attom’s figure for Chicago was negative every year from 2009 through 2015, when home values were slowly climbing out of the depths of the mid-2000s housing crash. In 2016, the first post-crash positive year, Chicago sellers averaged $3,000 in profit on their sale.

The last time sellers’ average profits were higher was 2007, the year the housing crash dawned.

Chicago sellers’ average profit then was $49,000, according to Attom.

SMALLEST GAINS

Despite the big increase in profits in 2020, Chicago sellers reaped the smallest gains of those in any of the nation’s 10 largest cities.

Philadelphia was next smallest, with an average gross return on investment of $55,000, and Los Angeles was biggest, at $251,000 profit.

Home values vary widely among the big cities, so it stands to reason that the dollar figures

@PROPERTIES

BY DENNIS RODKIN

GRIFFIN from Page 2

This house on Wesley Avenue in Oak Park sold for $669,000 in November. would, too. But in terms of the percentage return on investment, Chicago also trails the other major cities.

Chicago sellers in 2020 reaped a 23.2 percent gross return on their original investment on the house, according to Attom. The next-smallest return was in Washington, D.C., where sellers made 25.4 percent on their investment.

The biggest return was Los Angeles, whose sellers reaped a 55.8 percent return on their original purchase price.

fund produces—a deal Warren Buffett, who has rescued more than his share of previously highly regarded companies caught in death spirals, might have envied.

The investment raised suspicions that the investment gave Griffin a motive to stop or slow the short squeeze the Redditeers were engineering. Says his spokeswoman: “Citadel is not involved in, or responsible for, any retail brokers’ decision to stop trading in any way.”

Griffin hasn’t testified on Capitol Hill often. He appeared before the House subcommittee of thenRep. Henry Waxman, D-Calif., in November 2008 as the financial crisis raged. At the time, though, banks, rather than hedge funds, were perceived as the villains ruining the finances of ordinary Americans. Appearing on a panel alongside other hedge-fund titans like George Soros, he called for private-sector solutions to the systemic market flaws exposed by the housing bust instead of heavier regulation.

This time around, assuming he’s called to testify, Griffin is likelier to be more a subject of suspicion than a financial wise man whose counsel is being solicited.

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10 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

EDITORIAL

ure, it sounds cool enough: Decking over the unsightly train tracks skirting Soldier Field and creating an entirely new neighborhood studded with shiny high-rises, restaurants and shops is an appealing daydream, especially now, when most of us have barely left the confines of our own homes but for an occasional, fully masked run to the grocery store.

That said, the One Central idea pitched by sports-stadium-builder-turned-wouldbe-neighborhood-maker Bob Dunn seemed like a stretch even before the pandemic. Indeed, the Wisconsin developer’s audacious proposal seemed to fade from view since it last made the rounds in 2019.

But it just turned up like a bad penny, when Ald. Pat Dowell, 3rd, hosted a virtual town hall on the evening of Jan. 25 to allow Dunn to describe a more detailed version of his plan.

Dunn now wants to build up to 22.3 million square feet of apartments, shopping and a transit center on 31 acres decked over Lake Shore Drive and Metra Electric tracks, all funded in part by $6.5 billion in state financing. As Crain’s columnist Greg Hinz reported in advance of the meeting, the development would be anchored by a $3.8 billion transportation center that would include stops for Metra and Amtrak trains, and a spur line over to the CTA’s Red Line. Dunn notes that the transit center would become public property in 20 years under his plan.

The first, $3.8 billion phase of construction would include the transit center and 3,500car parking garage, plus 1.5 million square

CRAIN’S ILLUSTRATAION

S

An idea whose time hasn’t come

feet of “urban entertainment, dining and retail.” The next phase, pegged at $16 billion, would feature a series of large high-rises on the west end of the development site.

Dunn asserts that public investment would pay for itself many times over, with $59.9 billion in “new tax revenues and other economic impacts” for the state, $59.9 billion for the city and $14 billion for Cook County. Those figures come from an analysis prepared for the developer by AECOM, an engineering firm—a study Dunn paid for.

One thing Dunn didn’t note in that presentation is that none of the parties that

would be served by his plan are supporting it. Neither the Chicago Transit Authority nor the Regional Transportation Authority nor Metra have expressed a desire or even interest in building a massive transportation center in that part of the city. Nor have any of the organizations that usually have something to say about transit and development issues—the Metropolitan Planning Council or the Chicago Metropolitan Agency for Planning—chosen to back this plan. McPier, the agency that oversees nearby McCormick Place, has been silent as well.

Why? Perhaps we shouldn’t speak for

these organizations, but we can repeat what this page said when Dunn’s plan first surfaced: It doesn’t make sense. It didn’t make sense before the pandemic, and it makes no better sense now. As hopeful as we are that downtown Chicago will bounce back once the COVID-19 freeze lifts, there’s little reason to believe there will be enough demand for the central district’s existing residential and retail space to rebound overnight.

Meanwhile, other massive downtown-adjacent developments, like the 78 and Lincoln Yards, are already in the works. The idea of adding millions of square feet more in such a climate is, well, nuts. Then there’s the financial aspect: To get his project off the ground, Dunn is trying to create a need that doesn’t already exist for a transit hub— and he’s trying to get taxpayers to pick up $6.5 billion of the tab. The city and the state are in even worse economic shape now than they were when Dunn first floated his One Central idea.

Thankfully, Gov. J.B. Pritzker seems to get it, sending a strong message that state financing will be a tough sell.

Building a row of skyscrapers along Lake Shore Drive, an entertainment district that links McCormick Place and Soldier Field, and a pathway that provides South Loopers a gateway to the lakefront is an enticing idea, and perhaps it should happen someday, when the city and the state can afford to do it—or a developer comes along who’s willing to make it work without quite so much government investment. Until then, here’s hoping the One Central talk dies down again— and this time for good.

YOUR VIEW

Seizing the Paris Agreement opportunities for Illinois

P

and for export. For example, resident Joe Biden’s Day Ford is building hybrid ExplorOne announcement that ers, Lincoln Aviators and Police the United States will reInterceptors at its Chicago Asjoin all other nations in the Paris sembly Plant and a battery-elecAgreement is a powerful change tric Transit commercial van in of course that both advances Missouri. GM plans to hire 3,000 global solutions and opens Midengineers and tech workers to west opportunities. Global clibring 20 new EVs to market. mate change problems require Rivian and Navistar in Illiglobal solutions to reduce pollunois and Cummins in Indiana tion—it doesn’t matter for the at- Howard A. Learner is are moving to produce cleaner mosphere whether greenhouse the executive direcEV trucks and more energy-efgases are emitted in Indiana, In- tor of the Environdia or Indonesia. We’re all in this mental Law & Policy ficient engines.

Center in Chicago.

When it comes to clean entogether. ergy, the Environmental Law & Innovative clean energy and clean transportation technologies are nec- Policy Center’s supply chain reports have essary tools for global progress. The electric identified solar energy and wind power vehicles and renewable energy equipment businesses across the Midwest, including that we make in the Midwest create jobs, local installers and manufacturing plants save money and reduce pollution. Exporting making wind turbine blades and polysilthese clean energy technologies to develop- icon for solar panels. The ELPC identified ing nations can help accelerate global cli- 450 renewable energy supply chain busimate change solutions. That’s thinking and nesses in Illinois, plus 110 solar and wind energy businesses in Iowa, 241 in Minneacting both locally and globally.

Ford and GM are rapidly re-engineering to sota and 354 in Wisconsin.

That creates local jobs and new opporproduce cleaner cars for Americans to drive

tunities to export equipment and technical expertise. These manufacturers, developers, installers and professional services businesses operate in almost every Midwest congressional district and state legislative district.

Illinois and the Midwest are ground zero in the battle against climate change and for accelerating smart solutions. Our region is the nation’s transportation system hub and manufacturing center, and the nation’s largest concentration of remaining old, highly polluting coal plants. We should be the “between the coasts” fulcrum for clean energy and transportation innovations, which are good for the environment and the economy together.

Let’s face it—our communities are facing the challenges of climate change, from record-high Great Lakes water levels to more extreme weather events such as the damaging “derecho” thunderstorms, destructive flooding and tornadoes.

The Environmental Law & Policy Center commissioned 18 leading Midwest and Canadian scientists to write the state-of-the-science report on the impacts of climate change on the Great Lakes. It’s not a pretty picture:

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

P010-P011_CCB_20210201.indd 10

more lakefront flooding, toxic algal blooms choking our waters, invasive species and effects on crop yields.

A recent U.S. House subcommittee report showed that meeting the Paris Agreement goals could prevent 253,000 emergency room visits and hospitalizations for cardiovascular and respiratory disease, and 227,000 premature deaths over the next 50 years—in Illinois alone. The total economic value of health benefits from climate action would exceed $1.8 trillion in Illinois.

President Donald Trump’s administration did environmental damage and left much work to do. Midwesterners are practical people who try to drive solutions. We take on tough challenges. We put in the work.

We now have a president who prioritizes climate change solutions, values sound science and will put the “protection” back in the U.S. Environmental Protection Agency to help achieve healthier clean air and safe clean water for all. President Biden declared Jan. 27 as Climate Day. Illinois and the Midwest welcome the federal government coming back to these much-needed responsibilities.

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

1/29/21 3:47 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 11

LETTERS TO THE EDITOR

This bill will bring injured people justice. Sign it, governor.

R

ather than accept responsibility for their negligence or wrongful conduct and fairly compensate injured people or their families, insurance companies, corporations, hospitals and other wrongdoers sometimes opt to employ legal tactics that deny justice by delaying justice.

A recent Letter to the Editor fails to mention this is the impetus behind House Bill 3360, legislation requiring prejudgment interest passed by the Illinois General Assembly (“Governor, this bill will harm health care workers. Veto it,” Jan. 20).

The reason this change is necessary is to prevent deep-pocketed defendants from dragging out cases in the hopes that injured parties or their families will become so finan-

Chief executive officer KC Crain Group publisher/executive editor Jim Kirk

Associate publisher Kate Van Etten *** Editor Ann Dwyer Creative director Thomas J. Linden Assistant managing editor Jan Parr Assistant managing editor/ Joe Cahill columnist Assistant managing editor/digital Ann R. Weiler Deputy digital editor Todd J. Behme

cially desperate they accept a settlement that is far less than they likely would have received after a favorable verdict.

Forty-six states have some form of a prejudgment interest law on the books to help incentivize timely resolution of meritorious claims and reduce congestion of civil litigation dockets. Moreover, prejudgment interest does not accrue on settlements—and 97 percent of cases settle. Nor do defendants pay prejudgment interest when they win.

For the select few cases where this measure will apply, individuals who were harmed will be more fully and fairly compensated. Another important benefit will be less clogged court dockets and a more efficient legal system.

We strongly encourage Gov. J.B. Pritzker to

sign this bill and bring Illinois into line with the majority of states.

LARRY R. ROGERS President, Illinois Trial Lawyers Association

Forgetting the customers The customers didn’t forget Macy’s; Macy’s forgot the customers (“Macy’s closing at Water Tower Place,” Jan. 5). Their corporate strategies and policies basically say, we don’t want you in our stores.

The once-beautiful Loop Macy’s is a dump.

Marshall Field must be turning in his grave to see how far his once-stunning store has fallen. There is nothing that brings to mind any

of the glamor that a customer used to experience. Head upstairs and see the falling-apart facilities. Renovations have changed the floor layouts without thought to customer flow.

Macy’s at Water Tower is quite the same.

The place, like the Loop Macy’s, has been declining for years, in appearance and service.

And why would I go to Macy’s to buy clothing when I can’t try anything on? Macy’s doesn’t want to spend the money to staff fitting rooms to serve the customer. Not a very customer-focused method of business.

Sad to say, the funeral is almost over for Macy’s in Chicago.

TERRY LEJA Chicago

Your heart health issues won’t wait.

Digital design editor Jason McGregor Senior art director Karen Freese Zane Copy chief Scott Williams Deputy digital editor/ Sarah Zimmerman audience and social media

Don’t put off treatment and put yourself at risk.

Forum editor Cassandra West Political columnist Greg Hinz Senior reporters Steve Daniels Alby Gallun John Pletz Reporters Danny Ecker Stephanie Goldberg Wendell Hutson Ally Marotti A.D. Quig Dennis Rodkin Steven R. Strahler Contributing photographer John R. Boehm *** Director of digital strategy Frank Sennett Director of custom media Sarah Chow Associate director, Jaimee Holway events and marketing

At NorthShore Cardiovascular Institute, we’re taking every step to ensure your safety when you visit: • Conducting COVID-19 screenings on employees and patients, and requiring masks • Maintaining social distancing in waiting areas • Equipping our staff with the proper protective equipment With Telehealth, you can consult with specialists without leaving home.

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For subscription information and delivery concerns please email customerservice@chicagobusiness.com or call 877-812-1590 (in the U.S. and Canada) or 313-446-0450 (all other locations).

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1/29/21 12:05 PM

12 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

Incoming CEO Roz Brewer fills in some of Walgreens’ blanks, but not all of them mobile and walk-in customers.

Brewer helped figure out what each store needed to be—sit and gather CEO into unfamiliar territory.

Throw in responsibility for or grab and go. Along with other Walgreens’ role in the massive factors, her changes helped boost COVID-19 vaccination campaign, comparable-store sales growth to and it’s clear Brewer faces a steep 5 percent in 2019 from 2 percent in 2018. learning curve.

“She really had an eye for real “Despite her impressive accomplishments, she is not a health care estate and how it’s changing,” says person,” says professor Erik Gor- Hottovy, who formerly covered don of the University of Michigan’s Starbucks as an analyst at MorningRoss School of Business. “Wal- star. It’s an issue she’ll likely tackle greens might fall further behind in right away at Walgreens, which has the race to become a health care been working to rev up customer services provider and instead re- traffic and sales at its stores.

Brewer also helped transform treat into what she is good at—reStarbucks’ cold beverage protailing.”

Brewer has proved adept at hom- gram, moving away from gimmicky ing in on what customers want in a drinks like high-calorie, Unicorn retail experience and delivering, Frappuccinos toward lower-calosays R.J. Hottovy, a fund manager rie cold brews and nitro offerings.

Cold drinks grew from 45 percent of total beverage “SHE IS NOT A HEALTH CARE PERSON. sales in fiscal year 2016 60 percent in 2020.

WALGREENS MIGHT . . . RETREAT INTO to “Retail’s not dead in WHAT SHE IS GOOD AT—RETAILING.” the age of Amazon; it’s just bad retail is dead,” Erik Gordon, professor, University of Michigan says Hottovy. “Walgreens hasn’t made it at Aaron Allen Capital Partners, an enjoyable enough to shop the front investment firm specializing in the of the house, the nonpharmacy side of it, and I think that is going to restaurant industry.

When Brewer joined Seat- be something they can rely heavily tle-based Starbucks in 2017, some on her for.”

Brewer has also been front and of the coffee chain’s roughly 15,000 stores were struggling to serve both center with investors, explaining WALGREENS from Page 1

that the pandemic accelerated plans to transform stores to more convenient formats, and how Starbucks has relied on mobile to help with recovery.

Less encouraging is the performance of Sam’s Club during Brewer’s five years at the helm. After rising 4 percent in 2013, comparable sales grew 0.5 percent or less for the remaining four years of her tenure, Walmart filings show.

Meanwhile, archrival Costco posted mid-single-digit growth, says Zain Akbari, an analyst at Morningstar covering Walmart.

“It seems like top-line growth was a concern when they decided to go in a different direction at Sam’s Club toward the end of her tenure,” he says.

TROUBLE SPOTS

Growth is a concern for Walgreens, too. Walgreens stock has lost a third of its value since 2015 amid concern over slumping customer traffic and shrinking pharmacy profit margins. Simultaneously, competition from online retailers—namely Amazon, which counts Brewer as a board member until she steps down Feb. 16—has eaten away at sales on the front end of the drugstore.

To be sure, Brewer notched some successes at Sam’s Club, particularly on the technology front. She

launched scan-and-go payments, which Walmart says drove customer traffic and spending. The store’s Club Pickup feature grew 31 percent in fiscal 2017, with enhanced features like mobile check-in and prepayment.

Under Brewer, Sam’s also moved many of its back-end functions from paper-heavy manual processes to a Salesforce cloud platform.

The switch improved productivity and helped integrate in-store and online shopping channels, says Amanda Lai, manager at retail consulting firm McMillanDoolittle.

That kind of experience could help Walgreens catch up with rivals CVS and Walmart in the digital realm.

Pessina, who has been in charge since 2015, touted Brewer’s digital expertise when he announced her hiring. If Brewer can help improve store traffic and mobile offerings, it would make Walgreens—which is still in the “beginning innings” of digital—more competitive, says Elizabeth Anderson, an analyst covering Walgreens at Evercore ISI. But the most daunting challenge facing Brewer and Walgreens will be the company’s planned transformation into a health care provider. Walgreens has formed a partnership with VillageMD to put doctors into 500 to 700 stores over the next four years. The $1 billion project includes adding up to 9,000

square feet of clinic space to the drugstores.

Walgreens’ main drugstore rival is taking a different approach to health care. CVS expanded into insurance with the acquisition of Aetna and also owns a pharmacy benefits manager. Anderson says the hiring of Brewer confirms Walgreens will rely more heavily on its stores.

“They’re zigging and everybody else is zagging,” she says. “We don’t know for sure whether the zigging . . . is ultimately going to play out. . . .But they need something.”

Also unclear is how much autonomy Brewer will have in a C-suite full of Walgreens Boots veterans who have worked with Pessina for years. The company’s co-chief operating officers are Ornella Barra, who is Pessina’s life partner, and Alex Gourlay, who joined Boots in the 1970s and worked his way up.

Pessina will remain as executive chairman. The Italian billionaire is also the largest single shareholder, owning almost 17 percent of Walgreens’ outstanding stock.

“Given the fact he’s taken the role of executive chair, and the fact that he has this significant stock, means her role, like it or not, will be more limited,” says Charles Elson, professor of corporate governance at the University of Delaware. “Executive chair will still call the shots.”

Chicago Symphony Orchestra leans on its donor base to keep financials strong The CSO piled up a $4.4 million deficit for the fiscal year in June, after four months of canceled concerts. Yet, strange as it may seem, with the prospect of a full season of empty seats at Symphony Center, the deficit is projected to shrink this fiscal year—to a more typical $1.4 million—even while the orchestra’s 100 musicians continue to receive 60 percent of their pay.

What happened? Small-ensemble streaming programming like the Mozart piece at $15 per view, with discounts for multiple orders, helps but has brought in less than $100,000. Operating expenses, meanwhile, have waned 40 percent without big-name soloists and other production costs.

The real secret is how the symphony’s donor base, symbolized by its sprawling, gilt-edged board of

portant the symphony is in this city,” says Taylor, 72. “It’s like a baseball team, or something.”

For every dollar the CSO has refunded for canceled concerts (mostly to out-of-towners), it has received a dollar from subscribers donating proceeds of unused tickets.

FAMILY

Helen Zell, who chairs the symphony board, says the biweekly Zoom meetings she holds with up to 35 donors have resonated. “It’s kind of based on the old-fashioned principles of staying connected with your family,” she says, cautioning, “What I don’t know is how long you can do it. It’s been great in the short term.”

Chicago-based orchestra consultant Drew McManus says the pandemic could fortuitously spur orchestras to diversify earned income, 30 percent to 40 percent of which relies on ticketed performances.

“WHAT THAT (SUPPORT) TELLS YOU The San Francisco IS HOW IMPORTANT THE SYMPHONY Symphony in January started a subscripIS IN THIS CITY. IT’S LIKE A BASEBALL tion streaming service, charging $120 for a TEAM, OR SOMETHING.” 12-performance season (free to $250-and-above David Taylor, violinist, CSO donors); it got 5,000 ortrustees, has been galvanized. What ders in the first two days. McManus the CSO calls “support” rose slight- says streamed programming makes ly during the recent fiscal year, even it easier to share messages on social media containing a pitch from with the impact of COVID-19.

This year, management budgeted the symphony. “That just does their for a 45 percent drop. But less than advertising for them,” he says. “It’s seven months into the period, do- harder to do in a live setting.”

CSOtv, in contrast, is in the pilot nations reached the full-year forecast, offering hope they’ll match last stage, charging a la carte. Jeff Alexander, the CSO’s top executive, says year’s $41.2 million.

“What that tells you is how im- the overall focus is less on new fund-

P012_CCB_20210201.indd 12

TODD ROSENBERG

CSO from Page 3

Musicians of the Chicago Symphony Orchesta and guest musician Mark Shuldiner (harpsichord) perform J.S. Bach’s Brandenburg Concerto No. 2. raising techniques than on the symphony’s 12,000 donors in most states and abroad.

The mood among CSO musicians has improved markedly since they went on strike in 2019, eventually agreeing to a five-year contract that will raise base salaries 13.2 percent (more when compounded), to an average $181,272, third highest among U.S. symphonies.

Moreover, the CSO kept musicians on full pay through April 27 and then at 80 percent into the summer. The current 60 percent scale is lower than reductions at some other orchestras, but the CSO figure could rebound sooner. Full-time CSO employees got an across-the-board $500 holiday bonus from an anonymous trustee.

The American Federation of Musicians union has consented to work-rule changes, among them

how much archived and new music can be streamed without additional fees, depending on the degree of salary reductions.

“It’s a really good situation,” says Jim Smelser, who plays second horn and chairs the CSO members’ committee, which negotiated the contract. Management, he says, had the option of invoking a force majeure clause, suspending the pact, and chose not to do so.

OPERA CHALLENGES

The challenges are greater at opera companies like the Met and the Lyric Opera of Chicago, with more moving parts and, perhaps, prima donnas than orchestras embody.

The Lyric confronted a strike in 2018 by musicians, who settled for a 5.6 percent raise over three years while agreeing to fewer guaranteed weeks of work and a smaller orchestra.

In November, however, musicians accepted a 50 percent reduction in base pay through June, according to Ann Palen, a violinist who chairs the orchestra committee. That’s when their contract expires and potentially fraught bargaining sessions loom.

The Lyric last fiscal year increased net fundraising by 26 percent, to $17.1 million, as ticket revenue fell by half, to $15.5 million. It won’t detail current trends.

The CSO’s Alexander is eying a rebound beginning this summer, tied to resumption of in-person concerts by the CSO at the Ravinia Festival in Highland Park. Taylor, the assistant concertmaster, is skeptical. The concert hall could be further off.

As Taylor points out, not just musicians need to find their comfort zone—a reassured, vaccinated audience also is a must.

1/29/21 4:23 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 13

Two big malls buy more time with lenders

BY ALBY GALLUN Two big shopping malls in the Chicago area, Yorktown Center and Gurnee Mills, have bought more time to fix their debt troubles. But they still face a gloomy outlook for the retail real estate market.

In Gurnee, the owner of Gurnee Mills has reached a so-called forbearance agreement with a servicer that oversees about $124 million of debt on the property, according to Bloomberg data.

The owner, Indianapolis-based Simon Property Group, defaulted on the debt last year, as the coronavirus spread and many retailers stopped paying their rent, leaving some landlords unable to make their mortgage payments.

The agreement, reached Dec. 31, could give Simon, the country’s biggest shopping mall owner, more time to turn around Gurnee Mills, the area’s third-biggest mall, with about 1.9 million square feet. Bloomberg did not provide terms of the deal. Under a forbearance agreement, lenders agree not to take legal action, like filing a foreclosure suit, against a

property owner that has defaulted on a loan, and the borrower often agrees to some kind of payment plan in return.

In west suburban Lombard, the owner of Yorktown Center has worked out an extension to pay off about $107 million in mortgage debt on the 1.4 million-squarefoot mall, according to Bloomberg data.

STRUGGLING TENANTS

The mortgage initially matured in March 2019, but the property owner, a joint venture including New York-based private-equity firm KKR, reached an agreement with a loan servicer to extend the due date a year, to March 2020.

Then the pandemic hit, sending many retail landlords into a tailspin as they tried to collect rent from struggling tenants and making it even harder for KKR to pay off the debt.

Yorktown Center is 90 percent occupied, but “collections have been severely impacted with several tenant bankruptcies and potential (co-tenancy) risk,� according to Bloomberg. Under co-tenancy clauses in many leas-

es, retail tenants can move out if certain other stores close.

It’s unclear when the Yorktown Center loan matures now. A KKR spokesman declines to comment.

A representative of Simon, the owner of Gurnee Mills, did not respond to a request for comment.

Both malls carry securitized debt, mortgages that were pooled with other real estate loans and resold as bonds, or commercial mortgage-backed securities.

Delinquencies on CMBS loans secured by shopping malls and other retail properties soared last year as COVID-19 spread but have fallen in recent months as the market has stabilized.

As vaccinations pick up in the coming months, the economy is on track for a recovery this year.

But with more people shopping online—a trend accelerated by the pandemic—retail landlords face an especially uncertain future that could include more store closings and retail bankruptcies.

The question for Gurnee Mills and Yorktown Center is whether their recent loan agreements will help solve their problems or merely delay a reckoning.

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Gurnee Mills, the area’s third-biggest shopping mall, is owned by Simon Property Group.

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2021

RESIDENTIAL REAL ESTATE BROKERS

NOMINATE NOW! Deadline is Feb. 12

Calling residential real estate experts Crain’s 2021 Notable Residential Real Estate Brokers feature will highlight an impressive cross section of the region’s residential real estate community and its top producers.

Nominate at ChicagoBusiness.com/noterealestate Nomination deadline is Friday, Feb. 12. Section publishes Apr. 5.

To view Crain’s Notable Executives nomination programs, visit chicagobusiness.com/notablenoms.

P013_CCB_20210201.indd 13

1/29/21 3:55 PM

PEOPLE ON THE MOVE

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

ARCHITECTURE / ENGINEERING

CONSTRUCTION

EDUCATION

INVESTMENT

LAW

Wight & Company, Chicago

Skender, Chicago

Keypath Education, Chicago

Sandbox Industries, Chicago

Freeborn & Peters LLP, Chicago

Jeffrey Washington has joined Wight & Company’s Transportation and Infrastructure practice as Director of Construction, bringing to this role 34 years of experience overseeing complex projects in the pursuit of engineering excellence.

Washington’s work will also focus on diversity in the industry; he seeks to use this opportunity to continue to create a more inclusive industry for the next generation of transportation professionals.

Skender, one of the nation’s top building contractors, congratulates Todd Andrlik on his promotion to Senior Vice President of Marketing. Todd joined Skender in 2017 and has 21 years of marketing experience, including 16 in the construction industry. He quickly reinvigorated the marketing team, created effective strategies, generated bold brand awareness, and shaped external communication efforts while playing an influential role on the leadership team.

Ofa Stead joined Keypath Education as the Chief People Officer, charged with driving global organizational growth through people and culture. Stead oversees Keypath’s global HR team, leading employee development, people strategy, talent, and enhancing company culture. Stead comes to Keypath with two decades of expertise creating world-class teams and supporting commercial success. Her experience spans people innovation, leadership development, organizational effectiveness and global strategy.

Freeborn & Peters LLP is pleased to announce that Ryan G. Rudich has been promoted to Partner.

Ryan has a diverse environmental practice that focuses on defending businesses in complex environmental litigation, including against highstakes toxic tort claims, government enforcement action and in CERCLA cost recovery and contribution cases.

He has worked extensively for clients in the waste and recycling industry in Illinois and across the United States.

BANKING / FINANCE

CONSTRUCTION

Wintrust Multinational Commercial Banking, Chicago

Skender, Chicago

Sandbox Industries has announced the promotion of Kelsey Maguire to Managing Director of Sandbox Industries.

Maguire is a lead investor on the Healthcare Maguire Fund, managing the Fund’s investments in PWNHealth, Abacus, emids, IdealOption, Lumiata, and axialHealthcare. Maguire joined Sandbox in September 2019.

Sandbox Industries has announced the promotion Bhansali of Binoy Bhansali to Managing Director of Sandbox Industries. Bhansali is a lead investor on the Healthcare Fund, serving on the Board of Directors of Healthify, Quilted Health, and Ideal Option, and managing the Fund’s investments in Payfone, Healthspring, and CarePathRx. He is also a member of the Kauffman Fellows Program, Class 23.

Wintrust is pleased to add Stephen Jones as senior vice president of Wintrust Multinational Commercial Banking. In this role, Stephen will focus on helping foreign companies in the Midwest region of the United States grow their businesses. With more than 35 years in the industry, Stephen brings a wealth of experience in developing new clients and building existing client relationships.

Skender, one of the nation’s top building contractors, congratulates Mike Muehring on his promotion to Senior Project Manager. Mike joined Skender in 2016 and has over 15 years of experience in the construction industry. As a Senior Project Manager, Mike is responsible for delivering projects on schedule, maximizing productivity and efficiency, and controlling project costs for his valued interior construction clients throughout Chicago.

CONSTRUCTION BRAND ENGAGEMENT Freeosk, Chicago In a pandemic-altered shopping landscape, as brands and retailers look for low-touch and contactless ways of getting products in consumers’ hands, Freeosk, the leading omni-channel shopper engagement platform is poised for growth. The Chicagobased company named Lars Djuvik senior vice president of retail partnerships, where he’ll identify retail opportunities, expand Freeosk’s footprint and drive growth. Djuvik comes from Shopkick with 20 plus years of sales and leadership experience.

Skender, one of the nation’s top building contractors, congratulates Joy Perryman on her promotion to Director of Risk Management. Joy started with Skender in 2015 and was soon promoted to manage the risk management department, working closely with operations to identify ways to mitigate risks in daily procedures.

She is a certified Construction Risk and Insurance Specialist (CRIS), Certified Risk Manager (CRM) and member of the Risk and Insurance Management Society.

AmeriPro Roofing, Downers Grove

Development Solutions Inc., Chicago Development Solutions Inc., has announced the promotion of Shannon Cox to Project Executive, as a reflection of his exemplary performance and significant contribution to DSI’s robust growth in the corporate interiors market during his 16-year tenure with the company. In this new role, Shannon will continue building and managing DSI’s most complex interior projects, while developing his construction team, and ensuring successful delivery of quality projects for our clients.

Ann & Robert H. Lurie Children’s Hospital of Chicago, Chicago Sunjay Kaushal, MD, PhD, recently returned to Ann & Robert H. Lurie Children’s Hospital of Chicago to serve as the Division Head of Cardiovascular Thoracic Surgery. Dr. Kaushal spent the past nine years at the University of Maryland School of Medicine.

In addition to his clinical expertise and serving in leadership roles, Dr. Kaushal is actively involved in research, including tissue-engineering cardiovascular structures and launching clinical trials using cardiac stem cells.

Skender, Chicago

CONSTRUCTION SERVICES

CONSTRUCTION

HEALTH CARE

AmeriPro Roofing is pleased to announce the promotion of Dan Mesch to Chief Operating Officer and the hiring of Danny Lang as Chief Financial Officer. Mesch has been with AmeriPro Mesch for more than 10 years and will oversee customer service, production, human resources, fleet, compliance, recruiting, and marketing. Mesch has been a key element in AmeriPro’s growth and currently manages the Lang company’s real estate portfolio of more than 35 office spaces.

Lang will oversee all department budgets and payroll and will work closely with the COO and president on the company’s continued growth.

Prior to joining AmeriPro, Lang served as Chief Operations Officer and acting CFO for seven years for Zenere Companies.

HEALTH CARE

LAW Croke Fairchild Morgan & Beres LLC, Chicago Robin L. Letchinger has joined the law firm Croke Fairchild Morgan & Beres LLC as Chair of the Family Enterprise Practice group, where she will focus on family businesses, family enterprises, and family offices matters. Letchinger brings more than two decades of experience in family enterprise and litigation practices. She previously served as general counsel for a multigenerational family holding company providing strategic solutions that balanced business, personal, and tax goals.

Ann & Robert H. Lurie Children’s Hospital of Chicago, Chicago Joyce Wu, MD, has been appointed Section Head of the Epilepsy Program in the Division of Neurology at Ann & Robert H. Lurie Children’s Hospital of Chicago. Dr. Wu is nationally recognized for her expertise and research in tuberous sclerosis complex -- an inherited disease, which affects the brain, heart, kidney, lung and skin, and is associated with epilepsy and developmental disorders such as autism.

LAW Freeborn & Peters LLP, Chicago Freeborn & Peters LLP is pleased to announce that Jason J. Ben has joined the Firm as a Partner in the Chambers-recognized Bankruptcy and Financial Restructuring Practice Group. Jason has represented various parties in complex U.S. and international financial restructurings including both corporate debtors and secured lenders in Chapter 11 and out-of-court restructurings. He is licensed in the state of Illinois and the state of New York.

PUBLIC AFFAIRS

LAW

Res Publica Group, Chicago

Freeborn & Peters LLP, Chicago

Res Publica Group is pleased to announce that Kevin Owens has been promoted to Vice President + Director of the Chicago-based agency. During his tenure, Kevin has leveraged his expertise in public policy and communications strategy to excel in managing complex public affairs and community engagement projects. He works with both public and private sector clients helping them manage issues, navigate crises, engage constituencies and enhance brand positioning.

Freeborn & Peters LLP is pleased to announce that Jennifer M. Huelskamp has been promoted to Partner. Jennifer’s practice is focused on employment litigation and counseling.

Jennifer represents employers in several areas of employment law, including defending claims under Title VII of the Civil Rights Act (Title VII), the Age Discrimination in Employment Act (ADEA), the Americans with Disabilities Act (ADA) and more. She also routinely practices in the commercial litigation space.

LAW Freeborn & Peters LLP, Chicago Freeborn & Peters LLP is pleased to announce that Martin Syvertsen has been promoted to Partner.

He prides himself on finding practical solutions for clients and fighting for the best possible outcomes. Martin joined Freeborn after serving as an Assistant State’s Attorney in Cook County, where he honed his skills in state and federal courts at the trial and appellate court level. Martin served in the Criminal Prosecutions Bureau handling many appeals, arguing before the Illinois Appellate Court.

REAL ESTATE CRG, Chicago CRG is pleased to welcome Jennifer Nichols, J.D., M.B.A., M.S.T., as Senior Vice President and General Counsel. As a member of the firm’s senior leadership team, Jen oversees CRG’s in-house department handling all legal, compliance and risk management for the firm’s development projects across the United States. She has more than 15 years of legal experience counseling corporate clients on all aspects of real estate, corporate, tax and commercial matters.

TRANSPORTATION Skyway Concession Company, LLC, Chicago Kristi Lafleur has been appointed the new Chief Executive Officer of the Skyway Concession Company, LLC (SCC), the company that operates and maintains the historic Chicago Skyway Toll Bridge. Lafleur continues serving on the SCC Board of Directors (since 2016). Lafleur has held posts as Senior Vice President of HNTB Corporation, President and CEO of Ascend Infrastructure, and formerly was Executive Director of the Illinois Tollway, overseeing the $14 billion “Move Illinois” program.

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 15

2021

RAHEELA ANWAR

President and CEO Group 360 Consulting

LEADERS IN HR The upheavals of 2020—pandemic and social unrest—presented human resources executives with unimaginable challenges.

When COVID-19 set in, HR executives sent office staff home to work remotely and added safety features to plants and warehouses. They extended benefits such as additional paid time off and flexible schedules to accommodate parents with school-age children at home. And they developed virtual hiring and onboarding processes while devising ways to keep remote workers engaged.

Then, with the killing of George Floyd in May and demonstrations for social justice, HR executives led their organizations to take a fresh look at their diversity, equity and inclusion efforts. They changed their methods of recruiting to attract candidates of diverse backgrounds, established resource groups and implemented implicit-bias training.

All this while handling the day-to-day basics of administering payroll and benefits and tracking performance. These 54 managers met the mark and then some.

By Judith Crown

METHODOLOGY: The honorees did not pay to be included. Their profiles were drawn from nomination materials submitted. This list is not comprehensive. It includes only executives for whom nominations were submitted and accepted after an editorial review. These Notables are serving in a senior leadership role, are employed at companies of 50 employees or more and demonstrate the ability or power to effect change.

SALARY POTENTIAL Human resources managers held about 165,200 jobs in 2019. The largest employers of HR managers were: 14% Professional, scientific and technical services

2019 MEDIAN PAY FOR HR AND SIMILAR OCCUPATIONS Administrative services managers $96,940 Compensation and benefits managers $122,270

14% Management of companies/enterprises 11% Manufacturing

Compensation, benefits, job analysis specialists $64,560

9% Government

HR managers

8% Health care and social assistance

44% Other

The median annual wage for HR managers was $116,720 in May 2019. The median wage is the wage at which half the workers in an occupation earned more than that amount and half earned less.

The lowest 10 percent earned less than $68,300, and the highest 10 percent earned more than $205,720.

$116,720 HR specialists $61,920 Labor relations specialists $69,020 Top executives Training and development managers $113,350 Training and development specialists $61,210

Professional, scientific and technical services $131,340

47%

Manufacturing $115,000 Government $102,660 Health care and social assistance $99,380 Sources: U.S. Bureau of Labor Statistics, SHRM, Allegis Group, Kronos

KENDAHLE ARTIS

Human resources director Primera Engineers

When the pandemic hit last year, Kendahle Artis developed a dedicated COVID-response team and transitioned staff members to work from home.

Artis worked with her team to implement new virtual hiring and onboarding processes. The HR team worked with marketing to develop a welcome kit shipped to new employees’ homes to make them feel connected. Artis also introduced an employee-retention program to reduce turnover. And she established a wellness committee that addresses health and lifestyle practices, physical environment and workplace culture. The committee implemented several initiatives, including fitness events such as in-house yoga, mental health/meditation training and healthy-eating challenges. Artis joined Chicago-based Primera in 2012. Previously she was an HR generalist at West Monroe Partners. She’s a member of the recruiting committee at Chicago United.

LISA BARON

Chief human resources officer BCU

As chief human resources officer and executive vice president, Lisa Baron oversees recruiting, succession planning, compensation and retention, and other functions. Baron was a founding member of BCU, the Vernon Hills credit union that started at Baxter Healthcare and now serves almost 250,000 members.

During the pandemic, BCU provided employees with an option to buy back PTO to assist with COVID-related hardship. She served on a committee to safely return employees to the workplace and promoted wellness sessions.

Earlier, Baron sought to enhance culture with events such as cookouts and an on-site social patio. To capture employee opinion, she advocates for exit interviews, focus groups and annual engagement surveys. Baron co-chairs a BCU women’s leadership mentoring group and is senior leader mentor for a women’s leadership group at Baxter.

$104,690

In May 2019, the median annual wages for HR managers in the top industries in which they worked were:

Management of companies and enterprises $129,510

Raheela Anwar in October launched a Northbrook consultancy offering career transition services.

The woman- and minority-owned firm serves employers from Fortune 500 to midsize private-equity sponsors. Anwar says demand for career transition grew during the pandemic as companies downsized and laid off staff. Anwar previously was chief sales, client services and market strategy leader at BPI Group. Earlier, Anwar spent 18 years at Northern Trust and was a senior vice president for global investments. At the bank, Anwar co-founded initiatives to advance women in leadership. She speaks to women’s leadership groups at Fortune 1000 companies about the value of mentorship and networking. She chairs the board of governors at Winnetka Community House and is a director of the Winnetka-Northfield Library District.

of HR leaders cite employee retention and turnover as their top workforce management challenge, followed by recruitment and corporate culture management.

83%

of employers believe attracting and retaining talent is a growing challenge.

76%

of HR leaders say employee onboarding practices are underutilized at their organization.

LUTONDA BAUMGARDNER

Director, human resources Employment & Employer Services

LuTonda Baumgardner oversees HR operations at Employment & Employer Services, which facilitates employment preparation and job placement.

When the pandemic hit, Baumgardner helped the staff shift to remote work and secured personal protective equipment. Over the past 18 months, Baumgardner established a leadership development program to offer staff opportunities to enhance their leadership skills and take on new roles.

She instituted a new performance management system that fosters greater accountability for upholding organizational values. And she revamped hiring practices and job descriptions to attract a wider range of candidates. Baumgardner joined E&ES in 2019. Earlier, she held HR positions at Edward Jones and Gap/Old Navy. She is on the board of the National Black MBA Association Chicago chapter and is the career and professional development director.

16 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

VALERIE BERTERMANN

ONY BEVERLY

LAURA BIRK

KEVIN BOHAN

Vice president, human resources Synergy Flavors

Chief human resources officer Marshall Gerstein & Borun

Vice president of human resources Barilla America

Chief human resources officer WernerCo

At the Wauconda flavors supplier, Valerie Bertermann led initiatives to keep teams safe and the company operating during the pandemic. Bertermann implemented new procedures and policies to support performance management, succession planning and training, which included remote learning last year.

She redefined Synergy’s recruiting process, which included improving internal promotion processes.

Bertermann also enhanced parental leave benefits and wellness programs. Bertermann joined Synergy in 2019 from Deerfield packaging firm Pregis, where she was human resources director. Earlier, she held HR positions during nearly 12 years at SC Johnson, most recently as HR director for U.S. sales and marketing.

Bertermann is a member of the diversity and inclusion committee of the Flavor & Extract Manufacturers. She is an adjunct professor at Carthage College in Kenosha.

When Ony Beverly implemented a remote work program in 2018, little did she know that it would enable the law firm to quickly pivot to remote work during the pandemic.

With restrictions prohibiting normal recruiting and onboarding, Beverly led her team to implement fully virtual interviews, orientation and training, successfully integrating eight new hires. Earlier, Beverly introduced a blind rĂŠsumĂŠ review for staff recruitment, resulting in a 27 percent increase in diverse hires since 2018. Recently, Beverly revised the review process for associates to ensure they receive more transparent and actionable performance feedback.

Increased collaboration with the associates committee led to improvements in mentorship and development programs.

Before joining Marshall Gerstein & Borun four years ago, Beverly was HR manager at Skadden Arps Slate Meagher & Flom.

Last year, Laura Birk made strides in achieving an equitable and flexible culture at Barilla. The Northbrook-based pasta maker achieved equal pay for equal work across genders, verified internally and by a third-party vendor. When the pandemic set in, Birk’s team expanded benefits, including additional paid time off for employees impacted by COVID-19. When racial tensions flared across the country last summer, Birk established a racial justice charter that outlined a vision for a more inclusive and equitable workplace. The charter includes actions and metrics around access and exposure to leadership, employee development, recruiting, community outreach and supplier diversity. Birk leads an employee resource group focused on removing barriers that limit gender equality and work-life balance. The group sponsors a mentorship program and provides digital tools to employees.

Kevin Bohan had been with WernerCo for only two months when the pandemic hit. Bohan, who also is senior vice president of human resources, helped the leadership team navigate the response. The Itasca maker of ladders and construction equipment was deemed an essential business, and Bohan’s department developed safety protocols for employees in manufacturing, while the office staff pivoted to remote work. Bohan broadened the company’s approach to recruiting, enabling it to build a more diverse team. He revamped Werner’s maternity and paternity leave policy and created a part-time remote returnto-work program for employees returning from maternity leave.

Bohan joined WernerCo in late 2019 from automotive products supplier UGN, where he was chief human resources officer.

He speaks to industry groups on HR topics, including diversity and inclusion.

MARINA BOKSERMAN

Executive vice president, human resources Guaranteed Rate Cos.

Marina Bokserman joined the mortgage giant last year and leads a 40-person human resources team. She has elevated the HR department as the company last year hired 3,000 employees nationwide, bringing the workforce to more than 8,000. Bokserman is working with company leadership to streamline and automate HR operations such as performance feedback, onboarding processes and employee/manager resources. She also is strengthening the company’s recruiting and retention by hiring HR specialists to team with business leaders. With employees working remotely during the pandemic, Bokersman’s department has enhanced benefits and identified ways to improve engagement and job satisfaction. Bokserman joined Guaranteed Rate in May from Wintrust, where she worked for 14 years and was most recently vice president, human resources and employee relations leader at Wintrust Financial.

CONGRATULATIONS! Greeley and Hansen congratulates Bethany Florek, Director of HR, on her well-deserved recognition as a 2021 Notable Leader in HR by Crain’s Chicago Business.

We thank you for your strategic leadership and your GHGLFDWLRQ WR RXU Ă&#x20AC;UP RXU VWDII DQG RXU FRPPXQLWLHV <RXU SDVVLRQDWH FRPPLWPHQW DV D FKDPSLRQ RI GLYHUVLW\ DQG LQFOXVLRQ HQYLURQPHQWDO MXVWLFH JOREDO KHDOWK DGYDQFHPHQW JHQGHU HTXDOLW\ DQG ZRPHQ LQ 67(0 careers truly sets you apart as a Notable Leader in HR.

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Bethany Florek,

Director of Global HR, Greeley and Hansen

1/28/21 2:49 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 17

JULIE BURKE

SIRMARA CAMPBELL

KATHLEEN CARROLL

TONI CRENSHAW

WENDY DAHM

Human resource manager Klein & Hoffman

Chief human resources officer LaSalle Network

Chief human resources officer W.W. Grainger

Senior HR specialist Robert Bosch Tool

Chief people officer Baird & Warner

Julie Burke manages HR activities at the architectural restoration and engineering firm, including talent acquisition, retention, performance management, compensation, benefits and employee relations. During the pandemic, Burke creatively sourced personal protective equipment and hand-delivered masks to employees. She offered to go grocery shopping or bring meals to a staff member’s home.

Earlier, Burke created a paid family leave policy. She implemented quarterly wellness lunch-andlearn sessions. And she created an onboarding program in which new hires are paired with a buddy to help them navigate the first several months. Burke joined Klein & Hoffman from SupplyLogic, a third-party marketing procurement firm, where she was director, talent and human resources. She has volunteered with hospice organizations, including Southeast Oakland County Hospice and Midwest Palliative & Hospice Care/JourneyCare.

At staffing firm LaSalle Network, Sirmara Campbell supports 230 employees across five offices as well as nearly 1,500 temporary employees on assignment at clients. When the pandemic set in, Campbell moved employees to working remotely in a matter of days. She also scheduled virtual events and activities to keep employees connected. For example, employees attended a Zoom holiday party that featured musical guests and local comedians. For Thanksgiving, a chef conducted an online cooking demonstration. Campbell also has assisted Chicago-area HR peers by hosting twice-monthly virtual meetups to discuss how to keep employees safe, healthy and engaged with their companies during the pandemic.

She advocates for diversity and inclusion at LaSalle Network and has hosted webinars on the subject for HR leaders.

In the continuing pandemic, Kathleen Carroll leads a cross-functional team to get personal protective equipment to health care workers and first responders. Carroll, who also is a senior vice president and leads a 250-member HR department, established safety protocols for Grainger locations, such as augmented cleaning and social distancing requirements.

In the past two years, Carroll elevated the company’s diversity, equity and inclusion efforts.

She led a change in recruiting to make job postings and requirements more attractive for candidates from diverse backgrounds.

Last year she initiated monthly conversations with Grainger leaders on fostering an inclusive workplace. Carroll joined Lake Forest-based Grainger in 2018 from First Midwest Bank.

Earlier, she held HR positions at Aon and served as co-lead in the program office for the Aon and Hewitt merger integration.

At the tool company in Mount Prospect, Toni Crenshaw provides expertise in engagement, diversity, leadership and learning, training and coaching.

Crenshaw pivoted from a 10-year career as an electrical engineer to focus on learning and development as a way to help others pursue their career goals. When the pandemic hit, Crenshaw shifted a number of training programs to a virtual format. She has coached company leadership and HR executives in the organization’s transformation to work in agile teams. This transformation involves shifting from command and control to team-based ways of working and decision-making. Recently, she has focused on diversity and inclusion and elevated issues faced by women in the workplace. She is national chairperson of Women@Bosch and co-led the group’s first virtual national conference.

Wendy Dahm, who also is executive vice president, supports 466 employees and more than 2,300 Realtors at the brokerage firm.

With real estate designated as an essential business, Dahm played a critical role in helping Baird & Warner operate at full speed through the pandemic. The brokerage onboarded 531 agents in 2020, almost 100 more than in 2019.

Dahm helped to pave the way for employees to work from home and provided work resources and wellness programs. She expanded training and development to support company growth and the needs of remote workers. And she shifted the annual performance review system to a continuous conversation. Dahm became a charter cohort member at the Loyola DEI Leadership Institute to further develop Baird & Warner’s workplace practices promoting diversity and inclusion.

OUR TEAM PROUDLY INCLUDES CHICAGO’S VERY BEST Our success as a company depends on our team of employees. Leaders in HR give our employees the tools they need to be successful, and therefore carry out our values as Chicago’s Bank®. Our HR professionals, like Karen Moses and Norah Larke, are dedicated to the well-being and professional development of our employees, and because of them, we’ve been recognized as a top place to work.

Thank you for all you’ve helped us achieve. We couldn’t do it without you.

Congratulations on being named Crain’s 2021 Notable Leaders in HR!

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KAREN MOSES

NORAH LARKE

Vice President, Learning & Development, Wintrust

Senior Vice President and Chief HR Officer, Wintrust

wintrust.com

Banking products provided by Wintrust Financial Corp. banks.

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18 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

MARISSA DELGADO

Managing director, executive search Koya Partners

At the executive search firm, Marissa Delgado leads searches with a specialty in social and human services, organizations with global reach and health-related nonprofits. She has completed 35 executive-level searches in the social sector with 44 percent of the placed leaders self-identifying as Black, Indigenous and people of color and 70 percent women. Clients have included Boys & Girls Clubs of Chicago, After School Matters, Opportunity International and the Chicago Council on Global Affairs. Delgado joined Koya Partners in 2015 and became a managing director in 2019. Earlier, she was vice president of global research at DHR International and was instrumental in the firm’s international expansion. Delgado serves on the board of the Instituto del Progreso Latino and is a fellow in the Leadership Greater Chicago Class of 2020.

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ANGIE DEMCHENKO

ERICA DENNER

Chief people officer Cresco Labs

Chief people officer UPG Enterprises

Angie Demchenko has helped spur growth at the cannabis company, with her department hiring 1,650 employees in 12 months and onboarding 250 others through two acquisitions.

With a focus on diversity, equity and inclusion, women and minorities represented 59 percent of hires last year. Demchenko implemented a program last year to have lunch delivered daily to retail and operations facilities from local restaurants to limit employee exposure to the coronavirus and also support local restaurants. In fact, Cresco recruited recently unemployed restaurant and hospitality workers to fill 250 full-time positions at the firm’s Sunnyside dispensaries. The company provided additional pay for employees who worked on-site daily. Demchenko joined Cresco Labs in 2019 from Starwood Retail Partners, where she was vice president, head of human resources.

As chief people officer and executive team member, Erica Denner is implementing new HR strategies. She recruited talent with digital expertise, centralized functions and launched continuous performance management.

During the pandemic, hiring increased at the diversified industrial company, which supplies medical components including ventilator parts, mesh for filters and metal for hospital beds. Denner led efforts to shift some employees to remote work and reconfigured physical workspaces to ensure social distancing for on-site employees. At the same time, she served as HR lead through four acquisitions over 12 months. Denner joined UPG in 2019 from software firm Kazoo. Earlier, she was assistant director of human resources at the Museum of Contemporary Art Chicago. Denner is a career coach and mentor for the Posse Foundation.

SALO DOKO

JOSEPH DUDZIK

President and chief operating officer Tandem HR

Director of HR National Council of State Boards of Nursing

Salo Doko oversees a management team that provides HR services to small and midsize businesses. In the earliest stage of the pandemic, Doko worked with the IT team to get employees the equipment they needed to work remotely. He oversaw safety protocols when the office reopened.

Over the past 18 months, Doko opened offices in Wisconsin, Michigan and Indiana. He guided hundreds of businesses through the HR intricacies of the pandemic—protocols, guidance and laws that were changing quickly.

Doko began his career at Westchester-based Tandem in 2012 as an HR consultant. In 2017 he became an executive vice president and accomplished his three-year goals within 18 months. He was named to his current position in 2018. Doko is part of the Young Presidents’ Organization.

During the pandemic, Joseph Dudzik has managed business continuity, employee wellness and workforce planning at the nonprofit National Council of State Boards of Nursing.

He facilitated remote-work options for staff while also developing an efficient and safe return-to-office plan. He worked with technology teams to identify software and hardware needs and rolled out instant messaging and conference meeting software, including WebEx and Microsoft Teams. Before the pandemic, Dudzik had just finished leading a four-monthlong office remodel. The project involved multiple phases, including the temporary relocation of employee workstations.

His team also worked to improve work-life balance for staff members, including options for remote and flexible schedules.

He has volunteered as a youth soccer, baseball and basketball coach for more than 15 years.

1/28/21 2:50 PM

Congratulations and Thank You Dana Traci, CHRO Byline Bank

Dana Traci has served as Chief Human Resources Officer since late 2019, bringing a wealth of knowledge and experience focusing on cultivating a positive culture, and creating a great place to work.

Over the past year, Dana has led the Byline Human Resources team to excel through unprecedented challenges—we’re proud of your recognition and thank you!

bylinebank.com

©2021 Byline Bank. Member FDIC.

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20 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

DEBRA DUNNE

ALAN DURAND

DAVID EGAN

Director of human resources Westell Technologies

Director, people Kin + Carta

Head of human resources Mesirow

Debra Dunne changed the face of HR at Westell, an Aurora-based provider of network infrastructure products that had experienced years of downsizing. She developed training programs to enhance engagement and promote work-life balance, including a lunch-andlearn series focused on wellness.

She implemented employee-recognition programs and enhanced benefits to attract and retain staff.

In addition, Dunne implemented software that enables automated time and attendance, applicant and performance-management tracking. During the pandemic, Dunne provided communication, resources and training on workplace safety, employee health and mindfulness, meditation and stress management. During the peak period of COVID-19, she provided recognition gifts for essential workers on a weekly basis. Dunne joined Westell in 2018 from Mosaic Healthcare in Lincolnwood. Earlier, she held HR positions in health care and social services.

Alan Durand joined the consultancy in February 2020 and quickly became a fixture among the executive team navigating the pandemic.

He’s responsible for HR functions in the Americas and manages a team of 20 covering talent acquisition and development, onboarding, engagement, performance management, compensation, benefits and culture. Durand put a priority on diversity, establishing new pipelines to recruit employees of varied backgrounds. One of his initiatives has led the company to be within range of achieving 100 percent pay equity in its workforce. He also improved operational efficiency by establishing a shared-services HR function in partnership with Kin + Carta’s Argentina office. Durand previously was human resources director at consultancy Uptake.

He serves on the board of Kiki Queens, which raises funds for nonprofits serving the LGBTQ+ community.

David Egan, who is also senior managing director at the financial services firm, is responsible for HR strategy including talent management and employee engagement. A major accomplishment is the Mesirow Employee Value Program, which enriches the employee experience across six categories: wellness/benefits, culture, career, recognition, compensation and workplace environment. Under Egan’s stewardship, Mesirow is one of the few U.S. employers with a formalized student loan assistance program. He also launched a partnership to provide access to child/elder care services including virtual sitters, tutoring, learning pods and academic enrichment. Egan oversees Mesirow’s COVID-19 response from a human capital perspective and initiated programs and services to assist physical, emotional and mental well-being, including complimentary memberships for same-day health services and a new employee resource group for working parents and caregivers.

LENORE ERICKSON

Executive vice president, human resources First Bank of Highland Park

Early in the pandemic, Lenore Erickson transitioned 80 percent of the bank’s employees to working remotely.

She focused on strengthening learning and development by offering employees opportunities to enhance or learn new skills even while working from home. She also teamed with other bank leaders to ensure that employees have the tools and support to succeed in remote work. The institution is known for

workplace-friendly policies, with gifts for employees on their work anniversaries and promotions. In the past 18 months, Erickson researched and implemented a new health plan, achieving $400,000 in savings. She joined First Bank of Highland Bank in 2013. Previously, Erickson owned a human resources consulting business.

Since 2006, she has facilitated HR certification preparation classes.

JUDITH FLEEKS

Chief human resources officer American Dental Association

At the American Dental Association, Judith Fleeks oversees succession planning, performance management, training and development, recruiting and employee engagement.

During the pandemic, Fleeks transformed benefits to ensure the safety and well-being of nearly 440 employees at campuses in Illinois, Washington, D.C., and Maryland. She promoted the importance of mental well-being and the value of meditation and relationships to counter the effects of COVID-19-imposed isolation.

Under Fleek’s leadership, the HR department implemented strategies using agile principles to improve performance. She enhanced recruiting to improve diversity and introduced educational sessions and training on diversity and inclusion. She designed on-demand and real-time opportunities for learning and development.

And Fleeks retooled the association’s process for onboarding new employees. She joined the ADA in 1983 and climbed the career ladder.

Celebrating an extraordinary leader!

Congratulations to Lisa Baron for being named a Crain’s 2021 Notable Leader in HR. Your extraordinary people-first commitment and compassionate leadership have been invaluable to BCU’s growth and success.

Lisa Baron EVP & CHRO

BCU.org

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BETHANY FLOREK

Director of human resources Greeley & Hansen

Bethany Florek implemented and guided a series of employee impact groups at the environmental engineering firm. The groups address workplace concerns including diversity and inclusion, technology, project management, gender equality, and corporate activism and volunteering. Florek led the COVID-19 response team and established safety practices for employees, including essential workers at critical global water facilities. She developed return-to-office protocols covering 20 locations. And she expanded access to mental health

programs to address potential emotional impacts of COVID-19.

She also led a program to enhance knowledge about past and present systemic racism. Florek joined Greeley & Hansen in 2011 from Aramark. She chairs the board of the Illinois Diversity Council and is a member of the Chicago United Leaders Council.

BETSEY FRANK

Chief learning and development officer Greenberg Traurig

At Greenberg Traurig, Betsey Frank oversees professional development for attorneys and staff and firmwide technology training. With the shift to remote work, Frank oversaw a resource site that included technology reference cards and videos. Tip sheets covered remote video depositions, mediations and hearings. She also launched a learning management system and enhanced the onboarding program for firstyear associates. Frank has shared her expertise on the business impact of the learning function by publishing articles, presenting to law students and teaching graduate classes at Northwestern University. Frank joined Greenberg Traurig in 2019 from Sidley Austin, where she was director of staff development and technology training. She serves as caucus chair for the New Trier School Board in Winnetka, leading a nonpartisan process for slating candidates.

MARLO J. GAAL

SHARON GARCIA

Chief talent officer Ariel Investments

Vice president, human resources Sasser Family Cos.

Marlo J. Gaal, who also is senior vice president at the investment management firm, oversees HR functions including executive coaching, talent acquisition, development and retention, and equity and inclusion. She joined Ariel early in the pandemic and introduced a holistic wellness benefit to cover pandemic-related expenses.

And she introduced a flexible approach to time off with no maximum or minimum. Gaal designed and began implementing “Human Resources 2.0,” a new approach to the way Ariel attracts talent and motivates employees. She led a firmwide compensation study to ensure competitive opportunities using the pay vehicles that employees most highly value. Gaal joined Ariel from Groupon, where she was senior director of HR for North America. Earlier, she held HR positions at Hyatt Hotels and OfficeMax.

At the Schaumburg-based provider of transportation leasing and management, Sharon Garcia leads a team of 12 HR and communications professionals.

Garcia oversees HR functions, including succession, talent, benefits and compensation, as well as corporate communications. With the pandemic, Garcia organized a response team and transitioned employees to remote work. She handled legal, practical and employee-relations issues including safety concerns and travel restrictions.

And she established a Remote Work Engagement Committee to strengthen employee connections and company culture.

Earlier, she developed a strategy to ensure competitive benefits and compensation plans. Garcia also led the development of a succession-planning process that includes grooming future leaders. Before joining Sasser in 2016, Garcia was director of human resources for North America at Ohio-based Emerson Network Power.

BUILDING OUR FUTURE, INVESTING IN TOMORROW. Congratulations to Doug Rose on being named a Crain’s 2021 Notable Leader in Human Resources.

FirstMidwest.com

ELLEN GARIPPO

Vice president, director of human resources Berkshire Hathaway HomeServices Chicago

Ellen Garippo handles HR for more than 100 employees in 24 offices in the Chicago area as well as in Indiana and Michigan. She manages benefits packages, hiring, training requirements and performance reviews at the real estate brokerage. When the COVID-19 pandemic hit, Garippo led a transition to working from home, coordinating with IT to make sure employees had the equipment they needed. Earlier, Garippo created an employee training program in providing exemplary customer service.

This year, when a staff-appreciation event wasn’t possible, she arranged for gift boxes to be delivered to employees. Over the course of her career at the firm, Garippo has handled five acquisitions. She began her career in 2000 as a part-time HR assistant and receptionist at predecessor firm Koenig & Strey Realtors.

22 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

PHILIP GARRISON

TOM GIMBEL

Vice president, human resources Discovery Health Partners

Founder and CEO LaSalle Network

At Discovery Health Partners, Philip Garrison has transformed talent acquisition and championed a culture shift. The Itasca-based private-equity-backed company provides IT services to health care payers. Before the pandemic, Garrison implemented an initiative that allowed 70 percent of employees to work from home. That made it easier for Discovery to adapt during the pandemic. He also added programs to keep culture, engagement and workflow on track. For example, Discovery added recognition from the CEO for sales wins and customer successes. Earlier, he introduced a variable pay structure to reward performance and launched the company’s first leadership development program. Garrison joined Discovery Health Partners in 2017 from Dearborn Advisors, which provides technology services in health care. He serves on the Naperville Historic Preservation Commission.

CEO Tom Gimbel has led the staffing firm through the pandemic without layoffs and with highs in revenue. When LaSalle employees began working remotely, Gimbel held daily video town halls to share updates on the business. He gave up a salary for a number of months and asked directors to take minimal salary cuts to avoid layoffs. The company employs more than 50 researchers who source passive candidates to build and maintain a roster of potential candidates for future client searches. Gimbel makes frequent media appearances to discuss hiring trends and speaks to HR audiences on how to find and retain talent. He serves on the board of Start Early, which supports early learning for children in poverty. He also is an American Staffing Association board member.

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JOHANNA ‘JOJO’ HARRIS

Senior vice president, human resources The Jacobson Group

At the Jacobson Group, Johanna “JoJo” Harris has led changes to ensure employee engagement while the firm shifted to complete remote work due to the pandemic.

She’s been a sponsor and champion of diversity, equity and inclusion at the staffing company for the insurance industry. Harris introduced a talent management system that ensures company leaders connect with team members, understand their professional ambitious and provide training and development. She was responsible for an enhanced retirement savings plan that has helped attract new hires. For onboarding, she transformed a cumbersome paper-based process to an efficient digital system. Harris joined Jacobson Group in 2015 from Morton Salt, where she was director of HR. Earlier, she held HR positions at Chicago Tribune Media Group.

ERIC HECKSEL

Director, human resources Chicago Yacht Club

Since joining the Chicago Yacht Club early last year, Eric Hecksel has focused on the employee experience, improving retention and morale. During the difficult year, Hecksel worked with the club physician to create a healthy environment.

The club had to furlough workers in the spring but was able to bring back 93 percent of them. Hecksel led a fund to assist furloughed staff members. Additionally, Hecksel streamlined recruiting, which led to a better selection of candidates. And he improved the payroll and benefits structure for the club. His focus on diversity and inclusion meant that the club’s summer sailing school staff met objectives for race, ethnicity and gender balance. Hecksel earlier held HR positions in restaurants, including the Hyde Park Restaurant Group.

DAWN HOURSTON

Head of HR, sales, marketing and product-Americas Newark

Dawn Hourston is the HR business partner for Newark, a global distributor of electronic components that is a unit of Arizona-based Avnet. Hourston contributed to a company reorganization last year in which she provided day-to-day direction and guidance on the standardization of global roles and assisted the new CEO in developing a senior-level organization. With the onset of the pandemic, Hourston oversaw the transition to remote work. She facilitated virtual HR roundtables and Q&A sessions with managers. To help prepare for the return to the office, Hourston developed a back-to-work plan and managed the office space layout and seating assignment changes for the North America office. She promoted diversity, equity and inclusion and started a women’s resource group as well as a mentoring program.

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TONYA HUBBARTT

JIM HULLINGER

Vice president of human resources FONA

Head of talent acquisition PNC Bank

At the flavor manufacturer in Geneva, Tonya Hubbartt oversees talent acquisition, performance management, rewards and recognition programs along with health and wellness initiatives. FONA was acquired at the end of December by spice giant McCormick for $710 million. Hubbartt places a priority on employee engagement, and a 2019 survey for FONA by the Management Resources Association found that 94 percent of employees were engaged. Members of the HR department advise top leadership on protocols and handle facility sanitation, hygiene and social distancing requirements.

With the traditional summer picnic not possible, Hubbartt’s team designed the event to be a drive-thru parade, with decorated cars dispensing prizes, gifts and food for families. The company offers employer-paid insurance, and employees are guaranteed 40 hours of continuing education.

As head of talent acquisition and a senior vice president, Jim Hullinger has been instrumental in introducing predictive analytics to the hiring process.

Launched in 2019, the program helped yield a significant number of hires for PNC’s retail operation.

The program continues to help identify candidates, resulting in retention and productivity improvements. Hullinger, who is based in Downers Grove, contributed to the design of the artificial-intelligence tool that has helped managers make better hiring decisions, leading to more successful career matches and productivity. The tool was introduced in more than 20 PNC metropolitan markets, producing millions in annual cost savings. Hullinger joined PNC in 2011 and handled recruiting for 30 percent of annual hires for multiple PNC business lines.

He was named to his current position in 2016.

Predicting the likelihood of success Jim Hullinger leads talent acquisition for Pittsburgh-based PNC Bank, overseeing teams responsible for the hiring of more than 20,000 candidates across the country annually. He’s based in Downers Grove. Hullinger has led the introduction of analytics to screen job candidates and predict their likely success. PNC uses a third-party proprietary technology platform to administer the program. The bank has processed more than 150,000 applicants since June 2019.

CRAIN’S: How did you get interested in predictive analytics?

HULLINGER: My interest intensified in late 2017 while I was attending an industry conference where I met suppliers who introduced me to the idea of using AI and predictive analytics in the hiring process. This sparked my drive to introduce PNC to the notion that we needed to be better at predicting performance, better at the probability of retention and ultimately create the best-in-class candidate experience through the administration of pre-employment assessments.

How does the process work?

After an applicant’s résumé is reviewed by a representative in our talent acquisition department, our system pushes a link to the candidate to complete our pre-employment assessment tool.

Upon completion, a recruiter reviews the results, which helps to prioritize and match the candidate’s qualifications, key attributes and skills for the open position.

The candidate is compared against several

custom profiles across the organization to ensure a good behavioral fit to the organization and the role. These custom profiles were built using PNC performance data to increase the likelihood of finding potential top performers.

Are there different questions for different job roles? For example, what would be the characteristics needed in retail banking?

This algorithm is built to identify individual success measures aligned to the hiring goal for a specific line of business. For example, a successful teller adapts work style to a variety of situations, understands guidelines while maintaining the ability to ask tough questions, favors being the listener over the one who needs to be talking, and is motivated by career advancement. We still take skills and experience into consideration, while the assessment helps us understand the optimal behavioral fit.

What are the results so far?

Implementation of AI and predictive analytics has helped achieve an accurate assessment of talent, evidenced by our positive candidate application completion rates, advancement to interview stage and, ultimately, a conversion to hire.

How did you tweak this approach during the pandemic?

While the way in which we interviewed candidates transitioned to a virtual mode, we continued to administer our assessment program without interruption.

THE BEST LEADERS

EMPOWER OTHERS TO GROW AND SUCCEED.

And at FONA, we are honored to have just that kind of leader as our Vice President of Human Resources. She empowers us to grow and inspires us to be our best.

Congratulations and thank you to FONA Vice President of Human Resources Tonya Hubbartt.

One of Crain’s Most Notable Leaders in Human Resources.

24 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

CHERYL JOHNSON

EUNICE KIM

NORAH LARKE

Chief human resources officer Paylocity

Vice president, people Green Thumb Industries

Chief human resources officer Wintrust Financial

The social unrest of 2020 spurred Cheryl Johnson to promote diversity and inclusion at Paylocity, a Schaumburg-based provider of cloud-based payroll and HR management software. Johnson and her team implemented an unconscious-bias training program for Paylocity and its clients.

Additionally, Johnson led a redesign of Paylocity’s website to include a page on diversity and inclusion. Through this site, Paylocity released statistics on company diversity and announced the hiring of a chief diversity officer. During the pandemic, Paylocity rolled out flexible work schedules to ensure employees don’t have to choose between work and family. Options included split schedules, a four-day workweek, swapping a weekday for working on a weekend and reduced hours. Johnson joined Paylocity in 2018 from Echo Global Logistics, where she was chief HR officer.

With cannabis operators considered essential services during the pandemic, Eunice Kim developed COVID-19 protocols.

She streamlined premium pay for retail employees and spearheaded a virtual orientation program for new hires. Kim joined Green Thumb in 2017 when there were only 65 employees. She helped lead hiring to bring headcount to 2,000 in less than three years.

That includes the onboarding of more than 900 team members in 2020 and 610 in 2019. She worked with department heads in creating team structure, talent assessments, job descriptions and metrics for job promotion.

In addition, Kim implemented the first in-house payroll and human resources information system and has been instrumental in pushing processes and programs online. Before joining Green Thumb, Kim was director of culture and talent at consultancy Kaleidoscope.

Norah Larke assumed the top HR job at Wintrust Financial in January 2020, just before the pandemic hit. Larke led her team and the organization through a shift to remote work in a short period of time.

She oversees the work of 11 senior-level HR direct reports and a combined HR department of 60 team members. Over 12 years at Rosemont-based Wintrust, Larke grew from an HR generalist supporting 1,200 staff members to senior vice president and chief human resources officer supporting 5,200 employees.

She has handled the integration of more than 20 mergers and acquisitions. And she moved the department from a decentralized generalist system to a shared-services model. Larke used technology and workflow centralization to improve efficiency in payroll, benefits administration reporting, timekeeping, recruiting and onboarding.

97% average client retention rate over the past 10 years

KAREN MOSES

Vice president, learning and talent development Wintrust Financial

During the pandemic, Karen Moses has reshaped Wintrust’s in-person senior leader development program for virtual delivery. She created monthly online courses that addressed issues relative to COVID-19 and remote work.

And she led the learning and development team in creating a virtual orientation for interns and credit analysts, preparing them to assist with Paycheck Protection Program initiatives.

Moses joined Rosemont-based Wintrust in 2014 after running her own corporate training business.

She established onboarding and retail bank training programs and rolled out a program for the middle-market commercial group.

She also created new leader and senior leader development programs. Moses serves on the board of Tuskegee Next, a nonprofit that supports at-risk youth. She recently published an article on learning and talent development in a postCOVID world.

5x growth over the last 4 years

NORA O’CONNOR

Chief human resources officer Inland Real Estate Group

At Inland Real Estate in Oak Brook, Nora O’Connor oversees a staff of 12 supporting 1,100 employees in 30 states. O’Connor, who also is executive vice president, managed the transition to remote work, instituted resources for health and launched new PTO benefits for employees affected by COVID-19. She also managed the launch of Inland’s Diversity & Inclusion Council.

O’Connor joined Inland in 2007 from ACC Capital Holdings. She launched a human resources information system, updated the employee handbook and advised executive management on HR matters related to executive compensation, mergers, acquisitions and divestitures.

Additionally, she consolidated 26 different benefit programs to nine, saving the company several million dollars in the first year, and oversaw the transition of benefits from fully funded to self-funded, saving millions over eight years.

Average client tenure 8 years

C Congratulations Salo Doko, President & COO at Tandem Family of Companies and one of a Crain’s 2021 Notable Leaders in HR! C This recognition is an honor. I am proud of our team and the perseverance of our customers through the pandemic. It is truly a privilege to lead the fastest growing HR company in the Midwest with the most phenomenal talent.

We look forward to providing HR solutions for even more businesses as the market gets back to a new normal.

®

www.tandemhr.com/chicagocrains | (630) 928-0510 *

The IRS does not endorse any particular CPEO. For more information on certified professional employer organizations visit www.IRS.gov

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KELI REDINGER

DOUG ROSE

DIANE RUHL

Vice president of human resources Honey-Can-Do International

Chief human resources officer First Midwest Bank

Keli Redinger leads HR operations at the e-commerce housewares company in Berkeley. When the pandemic set in, Redinger’s HR team moved the office staff to remote work a week before the Illinois mandate and then let staff members know that they could work from home permanently if they choose. The company avoided the virus at its warehouse, which has a workforce of 150. Redinger introduced training to help employees reach their goals and advance.

And she enhanced benefits to make the company more attractive to recruits. Redinger joined Honey-Can-Do in 2016 from Noble Network of Charter Schools, where she was director of human resources. Earlier, she was corporate human resources officer at Wintrust Financial.

She serves on the board of Erie Charter School Foundation.

At First Midwest Bank, Doug Rose led initiatives to support employees during the pandemic, including pay premiums for front-line workers. The bank introduced benefit enhancements such as full coverage for telehealth and COVID-19 testing. Employees were able to access interest-free hardship loans and hardship time off. Rose, who also is executive vice president, launched diversity, equity and inclusion initiatives, including a partnership with DePaul University to help recruit candidates from diverse backgrounds. The HR team expanded leadership development and offered a virtual internship program. Rose joined First Midwest in 2019 from Discover Financial Services, where he was chief HR officer and senior vice president. Earlier he held HR positions at United Airlines and Capital One. Rose serves on the board of the Camping & Education Foundation.

EMILIE SCHOUTEN

Managing director, U.S. Midwest human resources lead Accenture

Senior vice president, human resources Coeur Mining

Diane Ruhl oversees HR functions at Accenture’s Midwest unit, covering 11,000 employees in strategy, consulting, technology, interactive and operations across 12 states.

Last year she helped lead a comprehensive COVID contact-tracing initiative.

She began her role in 2019 and has a goal of achieving gender parity across the Midwest by 2025 and increasing representation of Black and Hispanic employees. Previously, Ruhl was global HR managing director for Accenture global operations, based in Chicago. In this role, Ruhl led Accenture’s inclusion and diversity initiatives in the U.S., the U.K. and South Africa.

She implemented recruiting and retention initiatives to achieve 50-50 gender parity. Ruhl also helped lead Accenture’s Cloud upskilling initiatives. She served as host of Accenture’s Chicago International Women’s Day 2020 event for clients and employees.

Emilie Schouten is a leader on Coeur’s multidisciplinary COVID-19 committee focused on safeguarding the health and safety of employees, contractors and communities while minimizing business interruption.

No employees were laid off due to the pandemic. Schouten spearheaded diversity and inclusion efforts that included an analysis of pay equity by race and gender. Coeur hired two female executives for positions that historically were held by men. Schouten used online platforms to broaden recruiting, connecting with Women in Mining USA and the Society of Black Engineers. The company hosted virtual career fairs and forums with more universities than it could reach in the past with in-person visits. Schouten was one of the first employees hired when the mining company moved its headquarters from Idaho to Chicago in 2013.

GIBSON SMITH

Chief people officer Avionos

As co-founder and chief people officer of the consultancy, Gibson Smith shapes strategies and processes for talent acquisition and growth.

During the pandemic, he has developed cross-team pods that enable employees across the country to collaborate. He created a task force to support working parents and started a Monday meditation session.

Smith instituted analytics to assess behavioral characteristics of potential hires and ensure a diversity of thought. With the firm growing from 30 to 85 employees between 2019 and 2020, he created a career progression track and mentorship program. He’s a sponsor of resource groups for diversity and inclusion and women in leadership. Before helping to launch Avionos in 2014, Smith held HR positions at Accenture Interactive and Acquity Group. He serves on the board of Mustard Seed Chicago, a recovery center for individuals suffering from alcohol and drug addiction.

First Bank of Highland Park proudly congratulates Fir L Lenore Erickson for being recognized as a Notable Executive by Crain’s Chicago Business.

Lenore has successfully maintained a safe and connected work environment while executing a plan for growing and developing our team and showcasing why we are one of the “Best Places to Work.”

Congratulations on this well-deserved honor. We are grateful for your outstanding leadership, expertise and commitment.

FIRST BANK OF HIGHLAND PARK 1835 First Street Highland Park, IL 60035 (847) 432-7800

FIRST BANK OF HIGHLAND PARK 633 Skokie Boulevard Northbrook, IL 60062 (847) 272-1300

FIRST F BANK CHICAGO 8833 Gross Point Road, Suite #202 Skokie, IL 60077 (847) 272-7800

FIRSTBANKHP.COM • FIRSTBANKCHICAGO.COM

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26 FEBRUARY 1, 2021 â&#x20AC;˘ CRAINâ&#x20AC;&#x2122;S CHICAGO BUSINESS

DAYNA STOLLER

DANA TRACI

ERIN TURNMEYER

SARAH VENUTI YATES

LINDSAY VERSTEGEN

Chief of staff Objective Paradigm

Chief human resources officer Byline Bank

Vice president of people Civis Analytics

Director of human resources Joffrey Ballet

Chief people officer ShopRunner

Dayna Stoller handles compliance, onboarding, employee engagement, office management and HR business strategy for the recruiting and staffing firm.

After the pandemic began in March, Stoller assisted the organization in making a quick transition to remote work and added technology such as instant messaging. Stoller joined Objective Paradigm as an HR generalist in 2016 and was named to her current position in early 2019. She assisted in the design of new office space in the Loop, an open floor plan that includes adjustable-height desks.

She helped launch a training and development program. And she touches base with employees every six months to learn what is working well and catch problems. She serves on the board of T4Youth, an organization that raises funds for underserved youth in Chicago.

At Byline Bank, Dana Traci leads recruiting, compensation and benefits, employee relations and other HR functions. Traci, who also is executive vice president, joined the bank in October 2019, months before the pandemic upended operations. She ensured that employees were comfortable working remotely and provided stipends for ordering home office supplies. The HR department allowed employees an additional 80-plus hours of PTO. As of the third quarter of 2020, Traci had launched an engagement survey that achieved 94 percent participation, reviewed the 401(k) program and updated succession planning. Traci serves as executive sponsor for the bankâ&#x20AC;&#x2122;s newly established council on diversity, equity and inclusion and leads on DEI strategy. Before joining Byline Bank, Traci had a 25-year career at Discover Financial Services, where she held senior HR roles.

Erin Turnmeyer joined the data analytics firm in February 2020 and led the closing of the Chicago and satellite offices in accordance with local health department recommendations. She subsequently led the HR department to change policies to offer flexible scheduling and approve relocations. Turnmeyer restructured compensation and improved pay equity across job categories. She also developed and launched a training program for managers.

Before joining Civis, Turnmeyer was a civilian officer at the Office of the Director of National Intelligence, where she worked in talent development, designing training programs and curriculum for entry-level analysts and new managers. Prior to that, she served as the chief of staff for two officesâ&#x20AC;&#x201D;the Office of Data Strategy & Innovation and the Office of Weapons of Mass Destruction-Counterterrorism.

At the famed ballet company, Sarah Venuti Yates oversees HR operations and company culture. With the onset of the pandemic, Venuti Yates worked with the facilities director to transform Joffreyâ&#x20AC;&#x2122;s offices and workspaces for safety. She also established a hotline for employees needing help. Venuti Yates is leading a transformation of the Joffreyâ&#x20AC;&#x2122;s diversity, equity and inclusion efforts, with a focus on accountability and the achievement of meaningful goals. She arranged for a training program in diversity and inclusion that was intended for senior staff to be extended to all employees including dancers and production staff. Venuti Yates joined the Joffrey in 2018 from nonprofit Concordia Place, where she was director of human resources.

Earlier, she held HR positions for New England performing arts organizations.

Lindsay Verstegen leads the people function at ShopRunner, an e-commerce company that was acquired by FedEx late last year. Verstegen calmed co-workersâ&#x20AC;&#x2122; nerves, articulated the vision for the merger and led integration planning, says CEO Sam Yagan. ShopRunner provides e-commerce services to retailers and provides free two-day shipping to members. Early in the pandemic, Verstegen helped convince the CEO to mandate a switch to remote work. And she led a decision to ask co-workers to take a 20 percent pay cut as an alternative to a 20 percent staff reduction. Verstegen leads diversity, equity and inclusion initiatives and regularly speaks on the subject in panel discussions. She joined ShopRunner in 2017 from Braintree/Venmo, where she was head of talent and onboarding. Earlier, she was a recruiter at Groupon.

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CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 27

SALLY WASHLOW

YVONNE RENEE WATTS

ROB WILSON

Practice lead, Midwest Region Lee Hecht Harrison

Chief human resources officer Little City Foundation

President Employco USA

At the outplacement services firm, Sally Washlow leads the International Center for Executive Options practice, which supports senior executives displaced by restructurings, mergers or other changes.

Under Washlow’s leadership, the ICEO practice, which supports executives from companies ranging from Fortune 10 to privately held, has seen growth of 90 percent.

Last year, Washlow increased capabilities for executives to connect through virtual networking groups and use digital tools to increase their reach as they navigate change. She developed C-suite virtual roundtables for leaders to provide insights throughout the year, addressing topics such as diversity and succession planning. Washlow earlier was the first female president of Nasdaq-traded Cobra Electronics.

She is the first female president of the Chicago chapter of the Private Directors Association.

Yvonne Renee Watts leads HR functions at the Inverness nonprofit that serves children and adults with intellectual and developmental disabilities. She has implemented strategies that address recruitment, retention and performance, resulting in improved-quality hires, employee engagement and reduced turnover. During the pandemic, she focused on participant safety, transportation and facility use, incorporating CDC protocols. Watts negotiated a collective-bargaining agreement and wage reopeners, improving labor management relations and reducing employee grievances by 95 percent. Watts also is an adjunct professor at North Park University, where she teaches human resource management to students at the undergraduate and graduate level. Watts joined Little City Foundation in 2012.

Earlier, she held HR positions at Lutheran Life Communities in Arlington Heights, most recently as senior vice president, corporate services.

Rob Wilson is president and co-founder of the Westmont outsourcing firm that provides HR services to client companies. During the pandemic, Employco led more than 35 webinars on Paycheck Protection Program loans and assisted more than 300 clients in applying for funds. The company helped clients with layoffs spurred by COVOD-19 and then provided directives for the safe reopening of hundreds of businesses. Wilson also oversaw the transition of Employco’s staff to remote work. Wilson leads affiliated companies under the umbrella of the Wilson Cos., started in 1989: Corporate Risk Management, which provides insurance consulting and brokerage, and Staffworks, which provides contract and temporary staffing. He’s an active member of the Young Presidents’ Organization, serving on its Mid-America regional board and as chair of the group’s Wine Network.

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THE EMPLOYEE JOURNEY

53%

of HR professionals say employee engagement increases when onboarding is improved.

22%

of employees leave their jobs due to a lack of career development.

Other top reasons include lack of support with work-life balance (12%), their manager’s behavior (11%), unsatisfactory compensation and benefits (9%) and poor well-being (9%).

47%

say their workload is among factors contributing to burnout, 39% cite balancing work and their personal life, 37% mention a lack of communication, feedback and support, 30% point to time pressures and a lack of clarity around expectations, and 28% list performance expectations.

87%

of employees expect their employer to support them in balancing their life between work and personal commitments.

56%

of employees say additional paid time off would make them more loyal to an organization.

51%

of employers say using health and wellness benefits to maintain employee loyalty and retain talent will become even more important in the next three to five years.

Sources: SilkRoad, Work Institute, PR Newswire, Glassdoor, Fierce, MetLife

1/28/21 2:50 PM

28 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

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Bridge standoff represents hopes and fears as a consequence, a key pillar of Illinois’ economy.

The bridge would connect the two intermodal terminals on the west side of Route 53 with the Compass Global Logistics Hub, a $1.9 billion warehouse project that Kansas City, Mo.-based NorthPoint Development plans to the east. It’s the linchpin: Without the bridge, the project doesn’t work.

“All the state has to do is approve this bridge and we’ll break ground,” says Nathaniel Hagedorn, NorthPoint’s founder and CEO. “We’re ready to go. We’re ready to put people to work, and we think this is a project worth doing.”

The governor’s signature would move Compass a key step closer to reality after an ugly four-year battle. NorthPoint’s plan has divided local residents, triggered multiple lawsuits and pulled in federal officials including Rush and U.S. Sen. Richard Durbin, who support it.

Opponents show what side they’re on with yard signs from a vocal citizens group, Stop NorthPoint.

Even the U.S. Department of Veterans Affairs has weighed in, voicing concerns that more trucks would disrupt Abraham Lincoln National Cemetery nearby.

“NorthPoint is going to inject this region with trucking steroids and make the whole region so much worse,” says Erin Gallagher, a spokeswoman for Stop NorthPoint.

Pritzker is caught in the middle.

The proposal cleared a key hurdle in December, when the Joliet City Council approved it. But NorthPoint can’t move forward unless Pritzker allows the Illinois Department of Transportation to take over a key road from the village of Elwood.

The thoroughfare, Walter Strawn Road, would include the proposed bridge over Route 53. NorthPoint would cover the $20 million it would cost to construct the bridge.

But it can’t build it right now because Elwood is adamantly opposed to Compass and is fighting the project in court.

State law gives IDOT the power to take control of the road. Even though he likes the Compass proposal, Pritzker won’t exercise that authority against the wishes of Elwood officials, says an aide to the governor.

“The way to get it done is to convince the village of Elwood,” says Deputy Gov. Christian Mitchell.

Pritzker is unwilling “to override elected officials and seize the land on behalf of a private developer.”

The argument over Compass reflects the increasingly conflicted feelings that many Will County residents and officials have over the rapid expansion of the freight and logistics industries in the last two decades. The opening of Burlington Northern Santa Fe’s 638-acre intermodal yard in Elwood got the ball rolling in 2002, followed in 2010 by Union Pacific’s 785-acre intermodal terminal in Joliet.

The two facilities make up the largest inland port in North America, where giant cranes lift containers, many of them full of goods made in China, off rail cars from Long Beach, Calif., and other West

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CenterPoint Proposed closed loop

BNSF Railroad intermodal Proposed new bridge

Coast seaports. Trucks then haul away the containers to Midwest warehouses, some in industrial parks next door owned by CenterPoint Properties, the Oak Brookbased developer behind the two intermodal projects.

DOLLARS AND JOBS

Proposed new road

Proposed Compass Global Logistics Hub

Compass development—and its bridge—are part of the solution, too.

The bridge is part of a “closed loop” road system that would keep trucks off Route 53 and other roads by connecting with the BNSF and UP intermodal centers. A big reason congestion has become so bad is that many trucks are hauling containers on short trips to nearby warehouses, coming back empty and loading up again for another trip.

Compass, which would encompass about 33 million square feet of industrial space, is not only close to the intermodal terminals, but trucks using the closed loop would bypass local roads to travel back and forth between the park and the facilities, according to NorthPoint. The developer estimates that truck traffic will be as much as 40 percent lower with its bridge than without it.

“I think there’s people that have just decided, ‘Look, warehouses are bad. And we just oppose them at

Today, the transportation and logistics industries account for $20.6 billion of economic activity in northeastern Illinois and employ 106,000 people here, according to the Chicago Metropolitan Agency for Planning. The number of freight jobs here grew at twice the national average from 2001 through 2019.

With the area’s strategic location, at the intersection of Interstates 80 and 55, the freight industry seemed like a realistic answer to the decline of manufacturing in the region, especially for people without a college education. Warehouse work doesn’t pay as well as the union factory jobs of yesteryear, but it tends to be a couple of “THE REALITY IS THAT WAREHOUSES ARE notches above to- GOING TO HAVE TO BE BUILT BECAUSE day’s service jobs.

NorthPoint esti- THE FREIGHT’S THERE, RIGHT?” mates the average job at Compass will Nathaniel Hagedorn, CEO, NorthPoint Development pay about $42,000 a year, with pay ranging from $35,000 all cost,’ ” Hagedorn says. “But the reality is that warehouses are goto $111,000.

Rush, whose district stretches ing to have to be built because the from the South Side of Chicago freight’s there, right?”

Even if NorthPoint can win Pritzall the way down to Elwood, says the projected 10,000 jobs created ker’s support, the developer still

by Compass make his support a faces court challenges from Stop no-brainer. He doesn’t understand NorthPoint and Elwood that could block or delay its plan.

Pritzker’s position.

The controversies over trucks “I am surprised at the myopia that exists in this administration,” and warehouses in Joliet and Elwood have already had an impact Rush says.

But the industry’s growth has on the market, says Estus, the Colcome at a cost. Thousands of trucks liers broker. Some companies are that drive daily to and from the two wary of opening a warehouse there intermodal centers have clogged because of the politics, he says. up the local roads and resulted in Meanwhile, neighboring commutoo many crashes. Route 53, which nities like Channahon, Morris and stretches south from I-80 down to Montgomery are aggressively purElwood and beyond, is among the suing industrial developers and most congested truck routes, Galla- tenants with tax abatements and other incentives. gher says.

“They get a bear hug from those “The infrastructure simply is not there and cannot tolerate” more mayors and the city trustees,” Estus traffic created by Compass, she says. says. “If you go in for a public hearA plan by CenterPoint to build ing in Joliet, it’s a three-ring circus, a toll bridge extending Houbolt and your project gets delayed.”

In the end, public officials may Road south of I-80 and over the Des Plaines River will ease some of the have control over roads, bridges, congestion, says industrial broker zoning and taxes, but one thing Jim Estus, principal in the Rosemont they can’t control is the market.

“You’re not going to stop comoffice of Colliers International.

NorthPoint argues that the merce,” Estus says.

1/29/21 4:05 PM

New bas

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 29

More patients need financial aid, but largest hospitals spend little on free care CHARITY CARE from Page 3 more people lack health insurance.

Even before COVID-19 started spreading, the ranks of uninsured people in Illinois were rising alongside efforts to undermine the Affordable Care Act. From 2016 to 2019, the number of people without health insurance in the state increased 11 percent to 905,900, according to a Kaiser Family Foundation analysis.

Despite more people in need of financial assistance, the largest hospitals in the county by net revenue spend a minuscule portion of that money on free care, according to the Illinois Health Facilities & Services Review Board.

University of Chicago Medical Center spent $20 million on charity care, or 1 percent of net revenue; Northwestern Memorial Hospital spent $21.9 million, or 1.1 percent; Rush University Medical Center spent $20.4 million, or 1.5 percent; Loyola University Medical Center spent $6.3 million, or 0.5 percent; and Advocate Christ Medical Center spent $23.5 million, or 2 percent.

Meanwhile, Cook County Health’s flagship hospital spent $309.5 million, or 50.9 percent of its revenue—and more than double the amount spent by the 10 other large nonprofits combined. Cook County Heath gets a tax allocation from the county for public health and correctional health operations, but it doesn’t get taxpayer money for traditional medical services.

“Clearly, the other providers in the Cook County ecosystem are not carrying their weight, and how to get them to do that has eluded me so far,” Cook County Board President Toni Preckwinkle said late last year.

Some hospitals say they’re pro-

viding more free care during the pandemic, likely due to people losing their jobs—and the employer-sponsored health insurance that comes with them. But industry observers expect charity care to decline slightly since fewer people sought nonemergency care during the pandemic, and the federal government reimbursed providers for treating uninsured COVID patients.

COST FACTORS

Most of the hospitals say they don’t aim to spend a certain amount on charity care annually, as the cost is based on the number of patients who qualify for financial assistance and the types of services provided.

Since the passage of the Affordable Care Act, Northwestern Memorial Hospital has been “increasing funding to community health center partners, supporting care coordination efforts and making investments to support those most in need—none of which is recorded as charity care expense,” the hospital says in an email.

The University of Chicago Medical Center says in an email that it provides a range of community benefit programs, noting, “the narrow focus entirely on charity care grossly undervalues the breadth of our role and provides a misleading view of our organization’s sizable impact on those we serve.”

Rush did not respond to a request for comment. Representatives for Advocate Aurora Health, Loyola Medicine, Northwest Community Healthcare, NorthShore University HealthSystem’s Evanston Hospital and University of Illinois Hospital say they’re committed to ensuring all eligible patients have access to free or reduced care.

To maintain their tax exempt

SHARE OF THE CARE Free care for low-income patients represented less than 2.5 percent of net revenue for most of Cook County’s largest hospitals in 2019.

Meanwhile, county-run Stroger Hospital spent just over half of its revenue on free care—more than double the amount spent by the 10 other large nonprofits combined.

CHARITY CARE AS PERCENTAGE OF NET REVENUE, 2019 50.9%

Stroger Hospital (Chicago)

CHARITY CARE

NET REVENUE

$309.5 million

$608.7 million

University of Illinois Hospital (Chicago)

2.3%

$18.3 million

$780.9 million

Advocate Christ Medical Center (Oak Lawn)

2.0%

$23.5 million

$1.17 billion

Advocate Lutheran General Hospital (Park Ridge)

1.6%

$14.2 million

$900.1 million

Rush University Medical Center (Chicago)

1.5%

$20.4 million

$1.38 billion

Evanston Hospital (Evanston )

1.4%

$7.8 million

$568.4 million

Northwestern Memorial Hospital (Chicago)

1.1%

$21.9 million

$1.99 billion

University of Chicago Medical Center (Chicago)

1.0%

$20.0 million

$2.11 billion

Northwest Community Hospital (Arlington Heights)

0.9%

$4.7 million

$507.5 million

Loyola University Medical Center (Maywood) 0.5%

$6.3 million

$1.20 billion

Lurie Children’s Hospital (Chicago) 0.2%

$1.7 million

$903.7 million

Note: For Cook County hospitals with more than $500 million in net revenue Source: Illinois Health Facilities & Services Review Board

status in Illinois, nonprofit hospitals are supposed to spend at least as much on charitable services for low-income people as they would otherwise pay in property taxes.

In addition to free medical treatment, many hospitals also factor in costs associated with medical research and educating health care professionals, as well as losses they say they incur treating Medicaid patients.

For example, University of Chicago Medical Center says the cost of treating patients on government-run Medicaid—which pays far less than private insurance and Medicare—exceeds reimbursements by more than $100 million each year.

“The state decided how much it

wanted to pay for Medicaid and so that’s a government determination for a reasonable rate for a hospital,” Anderson says. “The fact that (hospitals) charge more—and can get more—doesn’t necessarily make it a community benefit, but it’s on the list.”

Additionally, for-profit hospitals get the same reimbursements from Medicare and Medicaid as tax-exempt, nonprofit hospitals that list shortfalls among their charitable contributions, says Tim Classen, associate professor of economics at Loyola University Chicago’s Quinlan School of Business.

Pediatric charity care costs are often low, largely because there are relatively few uninsured kids in Illinois—roughly 120,000, Lurie

Children’s Hospital Chief Financial Officer Ron Blaustein says.

“We’re at a disadvantage if we don’t get to include these other dollars”—from low Medicaid reimbursements to investments in programs that address health inequities—as charitable services, Blaustein says.

In Chicago, progressive aldermen have called for a program that would require wealthy nonprofit hospitals to make “payments in lieu of taxes” to the city.

“We can’t keep raising taxes and expecting low-income and working families to carry the tax burden,” says Ald. Jeanette Taylor, 20th. “Once we get back to something close to normal—it will be a conversation.”

Less competition would give United more pricing power on international routes UNITED from Page 3 date,” Jamie Baker, an analyst at J.P. Morgan in New York, wrote in a note to clients after United’s earnings report. “Close to half of Latin America capacity is operating under Chapter 11.”

Less competition would give United more pricing power on international routes, making it easier for CEO Scott Kirby to keep his promise to deliver more profit in 2023 than the Chicago-based carrier posted in 2019. Such a performance could again make United a favorite on Wall Street, as it was before the pandemic, when the airline’s stock traded near $100.

Today, it’s near $42.

United is more dependent than Delta Air Lines or American Airlines on international flying, which was under pressure from discount carriers before COVID-19. International travel demand is down nearly 90 percent, more than double the decline in domestic, according to the International Air Transport Association.

United’s biggest international market is Europe. When demand recovers, “there will be fewer car-

P029_CCB-20210201.indd 29

riers operating transatlantic services,” says John Grant, an analyst at aviation-research firm OAG in London. “There will be less capacity and a more cautious approach to expansion.”

Icelandic budget airline Wow Air, which offered flights between Chicago and London for under $300, went bankrupt a year ago. It also served Paris, Frankfurt, Amsterdam and Dublin. Norwegian Air, which flew from Chicago to Barcelona and London, said Jan. 14 it would stop serving the U.S. In summer 2019, Norwegian Air was operating 11,562 flights from North America to Western Europe, compared with 29,598 for United. Norwegian Air accounted for roughly 7 percent of the total capacity, based on seats available, between the U.S. and Western Europe. “To have that capacity taken out is a bit of a windfall for every airline,” Grant says.

PRESSURE EASING

In Asia, competition was fierce before the pandemic. Now pressure is easing as some carriers refocus on domestic flying and consolidation takes others out of

the mix.

In China, United’s largest Asian market, competitors’ “capacity in the last 12 months has been redirected toward their domestic networks,” Grant says. “Two of the big three Chinese airlines said they managed to make a profit in the third quarter on a 90 percent domestic network. For Tier 2 Chinese carriers—operating from Hangzhou and other second-tier cities—they have never made a profit on international services. It is likely they’re going to reflect long and hard on re-entering a market that’s unprofitable for them. That level of capacity and competition may not re-appear.”

That doesn’t mean China, the world’s fastest-growing aviation market, will be an easy one for United. “The growth in China in the last five to 10 years was the outbound market,” Grant says. “The problem for U.S. and European carriers is there is considerable consumer loyalty to the national airlines and the localized product, which makes it hard for the likes of United, Delta and American to compete.”

While Asia and Europe are tradi-

tional strongholds, they won’t likely recover until next year, Nocella said. “We expect emerging international markets to be stronger in the near term,” he told analysts. In the meantime, United is diversifying its network to take advantage of new opportunities, increasing service to Latin America, India, the Middle East and Africa.

Before the pandemic, United got about 38 percent of its revenue from international flights, compared with 28 percent for Delta and 26 percent for American, Baker estimates. But Nocella says United’s profit margin on international flights before the pandemic trailed domestic by 2 to 3 percentage points.

He’s banking on turning that around. In addition to bankruptcies and consolidation, COVID-19, as with most downturns, is forcing airlines to ground older or less efficient aircraft that either burn too much fuel or have too many seats.

“We’re counting the number of 747s and A380s that have been pointed at the United States that are no longer in the flying fleets of many airlines around the globe,”

A EUROPEAN HEADWIND Carriers flying between North America and Western Europe, based on total seats, in 2019. Discount airlines’ share will plunge because of COVID-19.

PERCENTAGE OF SEATS ON FLIGHTS BETWEEN NORTH AMERICA AND WESTERN EUROPE, 2019 12% United 11% American 13% Delta 7% Norwegian 1% Other discount

56% Other

Source: OAG

Nocella told analysts. “There are simply fewer wide-body aircraft in the fleets around the world. In particular, there are fewer of the very large ones with very large business-class cabins. And so that gives us a lot of confidence the world is going to be very different on the international front over the next cycle than where we had been.”

1/29/21 4:08 PM

30 FEBRUARY 1, 2021 • CRAIN’S CHICAGO BUSINESS

Northern Trust sees its banking business sag NORTHERN from Page 1 Even worse, the drop in net interest income, which totaled $1.48 billion, came even as earning assets surged 16 percent to $124 billion on average in 2020 from $107 billion the year before. At the end of 2020, earning assets were a record-shattering $159 billion.

Why? Northern is swimming in cash. Deposits of $144 billion at year-end were 32 percent higher than $107 billion at the end of 2019.

Northern had nearly $34 billion in loans on its balance sheet, 7 percent more than the $31 billion-plus it had at the end of 2019. But otherwise Northern was forced to stash more than $100 billion in low-yielding securities and Federal Reserve deposits.

Punishingly low interest rates pushed the bank’s net interest margin—the difference between what it pays on its liabilities and what it earns on its assets—to just 1.19 percent for the year. In 2019, it was 1.60 percent.

Some banks catering to institutional investors, as Northern does, are discouraging them from parking large sums while they look for new investment opportunities. Northern isn’t doing that.

“We want our balance sheet to be there for clients,” Chief Financial Officer Jason Tyler said Jan. 21 on Northern’s fourth-quarter

earnings call.

That’s how Northern has treated its banking operation for decades.

It’s almost a courtesy service for institutional investors and wealthy individuals. Most commercial banks aim to use 80 to 90 percent of their deposits for lending.

Northern’s loan-to-deposit ratio on average over the fourth quarter was 26 percent.

In an email, a Northern spokesman says Northern views banking as an integral part of all of its client services. “In the past tumultuous year, Northern Trust had the capital to take tens of billions in deposits and make loans to clients when the typical lending channels were closed during times of crisis,” he says. “We have been emphasizing to clients that we are here to support their borrowing needs. . . .Northern Trust deposit and lending solutions are fully integrated with the financial plans of our clients. Net interest income is highly dependent on rates, which we can’t control. Lower NII doesn’t surprise us given the current rate environment, and it doesn’t impact our view as to the strategic importance of our banking business within the mix of products and services we provide to meet the needs of our clients.”

Investors in Northern’s stock apparently aren’t as sanguine. The company’s stock price dropped 12.3 percent in 2020, while the S&P

Financial Index fell 4.8 percent. So far this year, Northern’s stock is off 1.3 percent while the index is up 1.1 percent.

The sour banking results are affecting workers’ livelihoods as well. Northern is eliminating 500 positions early this year—or 2.5 percent of its global workforce— and also is reducing bonuses and freezing pay for the time being of many employees.

In an email in January to staff, Northern CEO Michael O’Grady attributed the cutbacks to the “headwinds of continued lower interest rates, which reduced our earnings in 2020 and will put pressure on our profitability this year.”

The job cuts will save the bank $50 million a year, Tyler told analysts.

FEE WAIVERS

Adding to the ultraslim profit margins on banking is a related issue on the investor-services side of the house. Short-term interest rates are so low that Northern is having to waive fees on money market mutual funds to ensure clients don’t have to pay just to park their money. Those fee waivers are expected to run at $35 million per quarter beginning in the first quarter until rates rise enough to reinstate them, Tyler said.

Fee waivers were $24 million in the fourth quarter.

About $280 billion, or 20 percent,

w BANKING BUST Northern Trust makes most of its money from investor-related fees, but income from deposits and lending is an important contributor as well. Last year, it dropped for the first time in five years despite record-setting asset levels.

AVERAGE ASSETS

NET INTEREST INCOME $137 billion

$150 billion 125

$1.48 billion

1.5

100

1.0

75 50

0.5

25 0

$2.0 billion

‘16

‘17

‘18

‘19

‘20

0

‘16

‘17

‘18

‘19

‘20

Source: Northern Trust investor disclosures

of Northern’s assets under management are in money funds or similar cash-holding vehicles.

Even with the cost-cutting, one prominent analyst believes expense growth will outpace revenue growth in 2021 for Northern and its two principal trust-bank rivals, Boston-based State Street and New York-based Bank of New York Mellon.

“With additional headwinds from (net interest income) and fee waivers, we forecast all three to show negative operating leverage in 2021,” wrote Mike Mayo, analyst at Wells Fargo in San Francisco, in a Jan. 21 note. He added, “Our favorite is Northern Trust given its distinctive wealth business, which helps mitigate headwinds.”

Those are the foreseeable pressures on earnings. Throw in one more from today’s splashy business-news headlines as a wild card.

The firestorm over the “Reddit bro” squeeze on short sellers—many of them hedge funds—could affect another important fee line for Northern. It’s heavily in the business of lending securities it holds for clients (with those clients’ permission) to investors who borrow the stocks in order to bet against them.

Securities lending generated $88 million in 2020, about even with $87.2 million in 2019. If short sellers get cold feet due to the risk of concerted attacks by retail investors, that could (probably temporarily) dampen that consistent source of revenue as well.

I N D U S T RY A C H I E V E R S A D VA N C I N G T H E I R C A R E E R S Recognize them in Crain’s

For listing opportunities, contact Debora Stein at dstein@crain.com or submit directly to

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1/29/21 4:10 PM

CRAIN’S CHICAGO BUSINESS • FEBRUARY 1, 2021 31

Longtime top interior designer selling his home John Robert Wiltgen gut-rehabbed the 16th-floor condo on Lake Shore Drive in the past two years, planning to live there permanently, but now he’s moving to Palm Springs BY DENNIS RODKIN

J

ohn Robert Wiltgen, a fixture on Chicago’s interior design scene for more than 30 years, is selling the Lake Shore Drive condo he designed for himself and his husband.

Wiltgen designed the condo to have a modicum of formality, including crown moldings and porcelain tile floors, but also to be comfortably modern.

There is, for example, no television in the living room, but the television in the adjacent breakfast room is mounted on a long swingarm so it can be deployed out into the living room.

Wiltgen and Steven Oster, who are both retired, are asking a little less than $1.1 million for the 2,100-square-foot, two-bedroom condo at the old American Furniture Mart building, familiar in Streeterville for the bright blue pyramid that caps its 29-story tower.

The men bought the place in early 2019—after Wiltgen sold a West Loop condo he also designed—and launched a gut rehab, expecting to live there long term, Wiltgen says. In the renovation, they not only moved walls but put new utility lines behind them and covered them with finishes like wool intended for men’s suits.

“We redid everything except the floor in one bedroom,” Wiltgen says. “We planned to be here for a long time, so it had to be right.”

Nevertheless, after spending much of 2020 in Palm Springs, Wiltgen and Oster decided to make that their home instead.

The condo, which went on the market Jan. 27, is represented by Helen Jaeger Roth and Oliver Levy of Baird & Warner.

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Vol. 44, No. 5– Crain’s Chicago Business (ISSN 0149-6956) is published weekly, except for the last week in December, at 150 N. Michigan Ave., Chicago, IL 60601-3806. $3.50 a copy, $169 a year. Outside the United States, add $50 a year for surface mail. Periodicals postage paid at Chicago, Ill. Postmaster: Send address changes to Crain’s Chicago Business, PO Box 433282, Palm Coast, FL 32143-9688. Four weeks’ notice required for change of address. © Entire contents copyright 2021 by Crain Communications Inc. All rights reserved.

1/28/21 5:47 PM

Taking care of teammates

In a year unlike any other, our company and teammates were called upon to address unprecedented challenges and headwinds in the broader environment, working in support of each other, our clients and the communities where we work and live.

In appreciation of these outstanding efforts, we are recognizing eligible employees with Delivering Together compensation awards. A cash bonus of $750 or additional stock award is the latest step our company has taken to invest in our employees during the health crisis.

We’ve also significantly invested in industry-leading solutions and resources. To help many of our teammates balancing family and work, we provided an enhanced benefit of up to $100 per day for in-home childcare — funding nearly 3 million days of support. And in 2020, we accelerated the move of our U.S. minimum hourly rate of pay to $20, more than a year earlier than originally planned.

Here in Chicago, my teammates and I are here to help. We’re proud of this community and remain committed to making it a better place for us all.

For the fourth time since 2017, Bank of America is recognizing teammates with a special award in cash or restricted stock.

This year, approximately 97% of teammates will receive a Delivering Together award.

These awards are in addition to any regular annual incentives that eligible employees may receive.

Paul Lambert Chicago Market President

To learn more, please visit bankofamerica.com/community Bank of America, N.A. Member FDIC. Equal Credit Opportunity Lender. © 2021 Bank of America Corporation. All rights reserved.

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