THE SHOT TROOPS: Inside the Illinois National Guard’s inoculation mission. PAGE 8 TECH TAKEAWAY: Meet the CEO of software maker Relativity. PAGE 6 CHICAGOBUSINESS.COM | MARCH 1, 2021 | $3.50
DINING POST-PANDEMIC Some of your favorite spots haven’t made it. Others have changed chefs, menus and decor. BY ALLY MAROTTI IF ALL GOES WELL, Chicago restaurants could soon increase capacity to 50 percent after almost three months without indoor dining. But as vaccines ramp up, diners making their way back downtown will nd that not all of the business crowd’s fa- vorites have survived, and that the survivors bear scars. Menus have been changed, interiors revamped, fur- loughed sta have decamped to other locales. Tables will
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P001_CCB_20210301.indd 1 2/26/21 4:20 PM 2 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS GREG HINZ South Side Walgreens aims to ON POLITICS boost vaccine access for locals When ‘closing corporate A location in Bronzeville turned o its online scheduler to make sure nearby customers are given priority loopholes’ goes wrong BY ALLY MAROTTI are far less likely than whites to have been vaccinated, despite the heard a pretty hot rumor turer who had been eyeing Melanie Owens, a pharma- fact that COVID-19 has dispropor- the other day. On check- Illinois for an expansion. cy manager at a Walgreens in tionately a ected people of color. Iing, it proved to be wrong, Now, “I think they’ll end up in Bronzeville, was a little uncertain e Illinois Department of Pub- or at least premature. But it southern Wisconsin.” about getting the vaccine. lic Health reported last week that
nonetheless contained a gold e tax hike only adds to It was January and the rollout of the more than 2.5 million doses BLOOMBERG nugget of truth at its core. the “ticking ( scal) bomb” was new. She says the development administered in the state, 68.7 per- e rumor was that Chi- that is Illinois’ $144 billion in process felt rushed, and she didn’t cent have gone to white residents— Federal Retail Pharmacy Program. cago mortgage mogul Victor unfunded pension liability trust information coming from the who account for just 61 percent of e program, which the Biden Ciardelli, concerned about here, says another relocation Trump administration. But then the state’s population. Meanwhile, administration announced in Feb- soaring taxes and other consultant, Boyd Co.’s Jack Owens started picking up extra 7.9 percent of the doses have gone ruary, sends doses directly to its matters, had quietly moved to Boyd. Combined, his clients, shifts at vaccine clinics. to Black residents and 8.3 percent pharmacy partners. e allotment Miami and soon will take with including some now in Illi- Walgreens was one of the phar- have gone to Hispanic residents, is separate from the doses the state him the headquarters of his nois, increasingly are looking macy partners chosen by the fed- who account for 14.6 percent and gets from the federal government. It company, Guaranteed Rate. at places such as Texas, he eral government to vaccinate work- 17.5 percent of the population, re- is also separate from the doses set Ciardelli’s response when I says. ers and residents at long-term care spectively. aside for long-term care facilities. got him on the phone: No. In fairness to Pritzker, facilities. Owens didn’t even make Walgreens said when the pro- Although he has been spend- Illinois is not the only state it through her rst shift before the ‘SLOTS WERE FILLING UP’ gram launched that the partici- ing time in Florida lately, to be moving its tax struc- residents, excited about building Retail pharmacies, including pating pharmacies would be con- neither he nor the company ture in his proposed direc- immunity to COVID-19, changed Walgreens, have been vocal about centrated in areas hit hardest by has moved there and doing so tion, at least in part. For her mind. their ability to help with a more eq- the pandemic, to help with a more would involve a lot of trouble. instance, according to the “I think I vaccinated maybe 20 uitable rollout. Pharmacies are em- equitable rollout. In Chicago, they But, he added, if Chicago’s Tax Foundation, a Washing- people before I was like, ‘OK, may- bedded in communities and often were located largely in the South crime rate keeps soaring and ton research group that’s be I should give this a chance,’ ” she act as the main health care access and West sides. people keep eeing the city, fairly conservative but also says. point for people. ey have exist- Walgreens is preparing to start then, “the mismanagement of frequently cited in economic Owens was vaccinated that day. ing relationships with communi- administration of second doses government is a real prob- circles, only 16 states grant She says that as someone admin- ty members, which could make it through that program, says spokes- lem.” the full accelerated depre- istering the vaccines, she felt a easier to get people in for a vaccine. woman Erin Loverher. e phar- I’d call that a warning. ciation that’s now in federal responsibility to protect herself e Walgreens Owens’ works at macy has been receiving about And that’s the context of that tax code. Pritzker’s proposed and the patients. Seeing her opt in has leveraged its relationships with 480,000 vaccines a week through big $932 million tax hike on change there is worth $214 also swayed another Black woman customers in its vaccination e orts. the program to distribute nation- business Gov. J.B. Pritzker is million a year. working as an administrator at the When it started scheduling wide. About 39,300 were coming to pushing as part of his pro- On the other hand, the clinic to get her vaccine, too, Owens COVID vaccines last month, it Illinois each week. posed 2022 budget. largest change the governor says. closed the online scheduling portal. ose numbers are expected to Pritzker calls the proposal wants—capping deductions At Owens’ Walgreens location in ey “had us make our own rise as soon as the week of March 8, “closing corporate loopholes.” of corporate losses at $100,000 Bronzeville, she hasn’t experienced schedule based on our normal as second doses become available, Arguably that’s true, at least a year for three years, worth many customers that are hesitant customer base,” Owens says. “Slots Loverher says. She did not have ex- in the sense that any tax $314 million a year—would about the vaccine quite yet. So far, were lling up with people that act numbers. break I don’t receive must be absolutely make Illinois an it’s just people that are eager to get weren’t in the community, (who e Biden administration recent- someone else’s undeserved outlier relative to other states, it, wondering when they can sched- were) just trying to get the shots ly announced that it would increase loophole. But the proposal says Taxpayers Federation ule an appointment. anywhere.” doses owing through the Federal comes at the very time when of Illinois President Carol State and city ocials are also e pharmacy was one of 450 Retail Pharmacy Program to 2 mil- Portman. Such un- concentrating on an equitable vac- Illinois Walgreens that began ad- lion from 1 million. WHAT’S ON THE TABLE NOW JUST predictability is what cine rollout. But so far, state data ministering vaccines over Presi- really irks business, shows Black and Brown Illinoisans dents Day weekend, as part of the Stephanie Goldberg contributed. ISN’T VERY SMART. she says. Beyond that, according to population and jobs have the Tax Foundation, Pritzker’s begun to drop not only state- changes overall would reduce wide but in the metropolitan Illinois’ business-tax-climate area, and at a time when the rating from a weak 36th of the state refuses to confront its 50 states to an even sadder ever-rising pension debt. Not 39th. to mention Chicago’s murder What in some ways is most At Wintrust, your banker knows you. and carjacking wave. Or what concerning about all of this is Cook County Assessor Fritz the aura of payback Pritzker Kaegi is up to. and his aides seem to have You have someone to Outside experts I talked to embraced. e message pretty much said the same seems to be: Hey, business, thing. Pritzker’s proposal, you beat my graduated tax count on. taken in the wake of the defeat amendment, so now you have of his vaunted graduated to pay. income-tax amendment in Pritkzer ought to know November, is just one more better. e graduated tax straw on the back of an al- would have been paid strictly ready staggering camel. by individuals. His proposed “My very strong recom- loophole closings—includ- mendation to the governor ing a couple he signed o on is table these (tax) changes,” himself just a couple of years says Dennis Donovan, the ago—will a ect not the rich “D” in WDG Consulting, a but where companies add and When times got tough, more than New Jersey-based corporate move jobs. location rm. “Illinois has Perhaps this is just a 11,000 local businesses knew they been su ering from a negative bargaining position, de- could rely on us to secure PPP loans. business climate for years. . . signed to force his foes to the Start the conversation at .I think this will make some bargaining table. Perhaps the wintrust.com/meetus. companies think twice about governor will end his snit and moving there.” In fact, one gure out a better way. I hope of them is his client, says Don- so. What’s on the table now ovan, referring to a manufac- just isn’t very smart. Banking products provided by Wintrust Financial Corp. banks.
P002_CCB_20210301.indd 2 2/26/21 3:30 PM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 3
Tony Lindsay is the principal of North Brown Wells Capital, which just inked a deal with a co-working provider. vows big rebound at Motorola CEO sees strong growth despite its customers’ uncertain nances
BY JOHN PLETZ Motorola Solutions CEO Greg Brown is promising a quick come- back from a rough year. He predicts the supplier of tele- communications systems and equipment will post 7 to 8 per- cent revenue growth in 2021. at would be a sharp turnaround from last year’s 6 percent drop to $7.4 billion. “I feel pretty good about the de- Rising vacancy, sagging mand signals we see overall at this point for 2021,” Brown told ana- office demand drive a lysts on Motorola’s fourth-quarter earnings call Feb. 4. Still, Brown’s bold forecast new embrace of shared comes amid continued uncertain- ty in the market for two-way radios space BY DANNY ECKER and other Motorola o erings. e pandemic is weighing on govern- ment budgets, and some of the
TODD WINTERS TODD biggest private users of the com- pany’s radios are struggling. To hit the target, Motorola needs to con- HOW LANDLORDS LEARNED TO STOP WORRYING vince local public-safety agencies to spend scarce revenues on tradi- tional radio equipment, and push for quick adoption of new video equipment and software. AND LOVE CO-WORKING TENANTS Riding on the outcome is Mo- torola’s lagging stock price. Mo- LIKE MANY OFFICE LANDLORDS, Tony Lindsay has had denly stripped co-working rms of their revenue, torola shares rose 82 percent in the doubts about the co-working craze. “and I don’t want to be stuck holding the bag,” “THE REALITY IS WE two years before the pandemic, Watching as WeWork and its shared o ce pro- Lindsay says. IDENTIFIED HAVING easily outrunning the 25 percent vider peers signed a barrage of big, long-term Now, nearly a year into a COVID-19 crisis that increase for the S&P 500. But the leases and subleased that space to companies has devastated some of the shared o ce sector’s CO WORKING IN stock has recovered more slowly that could rent it by the month, the principal of biggest players and stung countless landlords, than most from the COVID col- Chicago-based developer North Wells Capital sat North Wells just inked one of its rst new o ce OUR PORTFOLIO lapse last March, rising 47 percent on the sidelines—even losing out on some ten- tenants since the pandemic began in Chicago AS BEING REALLY while the S&P gained 71 percent. ants that chose co-working over his rm’s River startup Workbox—a co-working provider. At $180.26 early on Feb. 26 , Mo- North properties. Not that his opinion on co-working companies ADVANTAGEOUS.” torola shares were down 1 percent “We were saying the other shoe is going to drop from a pre-COVID peak of $182.97 at some point,” if an economic downturn sud- See CO-WORKING on Page 19 Tony Lindsay, principal, North Wells Capital See MOTOROLA on Page 20 That retail apocalypse? It’s not on Oak Street. ‘Demand for space is less than normal, but it’s not horri c’
BY ALBY GALLUN makeover of the six-story build- ots and looting of 2020, devas- ing, which has sat largely empty tating blows to retailers all over e coronavirus pandemic since 2019, after the retailer led the city, but especially on North has turned the world of brick- for bankruptcy protection. e Michigan Avenue. ough Oak and-mortar retailing upside closing of Barneys, an anchor Street didn’t dodge the storm, down, but it hasn’t shaken one of the Gold Coast retail market it has pulled through. e strip’s investor’s faith in Chicago’s ritz- since 1992, represented another retail vacancy rate is actually iest shopping strip: Oak Street. step in the slow decline of phys- lower than it was in 2019, ac- e owner of the former ical retailing amid the growth of cording to Chicago brokerage
Barneys store at Oak and Rush e-commerce. CBRE OF COURTESY RENDERING streets is investing in a major en came the pandemic, ri- See OAK STREET on Page 19 The revamp of the former Barneys store in the Gold Coast will chop up the space for multiple tenants.
P003_CCB_20210301.indd 3 2/26/21 4:19 PM 4 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS CHICAGO COMES BACK JOE CAHILL ON BUSINESS How Pritzker, Welch can regain trust ere was one encouraging note earn trust by showing a commit- in Illinois House Speaker Chris ment to the common good. Welch’s otherwise spit-take-induc- Next, Pritzker, Welch and their ing proposal to reload the gradu- party should go after the pension ated income tax proposal voters de cit itself. Before seeking more rejected last fall. revenue from taxpayers, political In oating that idea Feb. 24, leaders should do everything in Welch acknowledged the need to their power to shrink pension regain the trust of Illinoisans who obligations. at means attacking
made clear their unwillingness to the driving force behind rising BLOOMBERG hand more cash to a political class pension debt: compounded that steered the state into a nan- annual cost-of-living increases for cial abyss. To do so, he suggested— pensioners. in vague terms—linking a gradu- Eliminating cost-of-living raises ated income tax to “pensions.” He would require a constitutional Seeking connection in this was referring to the $144 billion in amendment to delete a clause unfunded state employee pension barring any diminution in pension obligations that Illinois politicians bene ts. Pritzker and legislative allowed to accumulate over the leaders declined to propose such disconnected world? past few decades. an amendment when they asked Welch appears to realize that voters to approve an amendment There’s an app for that, of course. But do you need more social media? Here are some government won’t win voters’ eliminating the state constitution’s trust without addressing a pension provision that precludes graduated pros and cons of other emerging platforms—and why trying new things matters. funding crisis that’s devouring income tax rates. at omission state nances. Legally required sent a clear message about the BY EMILY DRAKE AND TODD CONNOR grudge it, even—but here’s the contributions to employee pen- Democrats’ priorities, and the thing: Contempt prior to investi- sion funds claimed 21 percent of likelihood that money from a grad- Chicago Comes Back is a weekly series on ChicagoBusiness.com pro- gation has no place in leadership. the Illinois budget this year and uated income tax would be spent viding leadership insights to help your business move forward, written by It never did. If you investigate will take even more in years to responsibly. leadership consultants Emily Drake and Todd Connor. Clubhouse and opt out, cool. You come. Yet the funding gap contin- If Pritzker and Welch are serious Drake and Connor facilitate Crain’s Leadership Academy. Drake is tried it, and it didn’t land or fuel ues to grow because the state isn’t about winning trust, they’ll allow a licensed therapist, owner of the Collective Academy and a leadership a focus of yours or your organiza- contributing the amount actu- Illinoisans to vote on a standalone coach. Connor is the founder of Bunker Labs and the Collective Academy tion. But no one can hold disdain arially necessary to cover future constitutional amendment repeal- and is also a leadership consultant. if they haven’t given it a whirl. ing the so-called pension Check out previous installments at ChicagoBusiness.com/comesback. A MERE PROMISE TO ADDRESS protection clause. To TC: Audio can be a great equaliz- build public support and EMILY DRAKE: Come back, return, spectful conversations. ere are er, too. What’s most interesting to PENSION FUNDING ISN’T ENOUGH. treat retirees fairly, such hybrid or even liquid: We’re using other innovations, too, like Plain observe is folks navigating how to an amendment could be these words a lot, and sometimes Sight, a startup app out of Detroit host and moderate a respectful pension obligations. narrowly drawn to permit only re- I wonder if we should be practic- that’s blending virtual with in-per- conversation, which is import- I’m glad a top state o cial rec- ductions in future pension increas- ing phrases like “clean slate,” “new son communities. ant skill-building that collectively ognizes the connection between es under the COLA mechanism. beginnings” or “anything goes” as we have let atrophy. We’ve often out-of-control pension debt and Sure, public employee unions we get deeper into 2021. We say ED: I am skeptical, and I hear you. said that the harder and more mistrust of government. But Welch are likely to ght any change in this a lot, and I know it’s hard to I noticed I had major FOMO when powerful position is not to be the should understand that a mere pensions. But it’s worth trying to incorporate a new decision-mak- others were joining, asking me if I featured speaker for the reside promise to address pension fund- win their support. It can be done; ing calculus every day, but I re- joined (and I ultimately did), and chat but to be the moderator of ing isn’t nearly enough to con- Arizona unions backed a narrow ally don’t think we’re returning not wanting to be the last person the conversation. Leaders at their vince voters they can trust Illinois amendment to a pension protec- to anything—and I think that’s a to adopt the next biggest thing. best are often moderators, or fa- politicians with billions more tax tion clause in that state’s consti- good thing. It used to be that lead- I’m only human. But, for me, the cilitators, more than just deciders. dollars. tution. If unions won’t cooperate, ership means you capture a room. skepticism is really born from a Clubhouse, to the extent it’s cre- In Illinois, we know how much Pritzker and Welch should forge But there’s no physical space to place of fatigue. Another platform ating that capacity through audio politicians’ promises are worth. ahead anyway, as Rhode Island capture anymore. So, instead of that has no in-person component, discussion rooms, is building that Only their actions count. And the o cials—led by Democrat Gina looking at work as an amorphous when that’s what I want more than capacity in people. actions of leading Illinois Demo- Raimondo—did in tackling a simi- “team,” we have an opportunity anything, and asking myself, “Will crats continue to inspire mistrust. lar pension crisis. instead to look at each individual it satisfy an itch I didn’t know I ED: e sentiment and strategy For example, Welch’s cham- Only after passing such an in front of us and honor their spe- had?” or “Will it create a new itch I appreciate the most is innova- ber and the state Senate recently amendment and reducing the ci c needs and desires. that I have to scratch?” tion—trying something, seeing passed legislation increasing Chi- overall pension obligation can what sticks and course-correcting cago re ghters’ pensions. ere state o cials justi ably ask TODD CONNOR: Well, there will TC: Totally. I went for it full bore, as we go. I’m amazed regularly was no reason to saddle taxpayers taxpayers for money to close the be a return to in-person living, but and here’s why I think it matters: how leaders are doing this with with an additional $850 million remaining gap. Would a graduated you’re right: ere’s a new calcu- e meetings we’re having are increased resilience and tolerance in pension costs, other than the income tax be the right way to raise lus and a new liquidity to work. conducted largely on video. e for what 2021 has dealt already. All political imperatives of a caucus the necessary revenue? Maybe. Tim Leberecht at “House of Beau- ability to listen in on an interest- the while, there is no replacement beholden to public employee I’m not opposed to it on principle. tiful Business” said it best: “ e ing conversation amongst experts for in-person engagement. e - unions. e vast majority of states with an pandemic made the ‘multiverse or people from unrelated elds nal word is, we will be in-person e re ghter pension bill now income tax charge higher rates on workplace’ a reality.” that does not feel formulaic seems again, but everyone may not be in awaits Gov. J.B. Pritzker’s signa- higher incomes. And the necessity You and I have been talking so rare. So the audio boom that’s the room that would be otherwise. ture. at’s an opportunity for the of a constitutional amendment about the challenges of social happening around Clubhouse— Democrat who engineered last would give voters the nal say. media—and the latest entrant to and soon to be Spaces on Twitter, TC: To be clear, I want to get back year’s failed push for a graduated Regardless of the revenue the club, Clubhouse, the new in- and a competitor from Facebook, in-person. Our humanity, if not income tax to start rebuilding trust source, lawmakers should raise vite-only, drop-in audio chat app too—appeals when we’re in such our company revenue targets, de- with the electorate. only enough to fully fund pen- on iPhone platforms—for this rea- a state of fatigue. mand it. While I like to be an early Vetoing the re ghters’ pension sions on an actuarial basis. All son for a few weeks now. I know adopter and will ride this Club- hike would be a small but import- proceeds should go to pensions, you’re skeptical, but I’m into it. ED: I think about the leaders we house train for a minute, I’m also ant rst step toward scal integrity and the new tax should expire What bothers me with other social work with, and I think about what comfortable being an early aban- in Spring eld. It also would signal when they’re fully funded. ese media—the permanent record, they might ask: Isn’t it annoying? doner. at’s also part of being a Pritzker’s willingness to put the restrictions should be spelled out the anonymized sharing, the abil- To have to constantly adapt? To leader: Knowing when the ideas interests of the state as a whole in legislation or any necessary con- ity to be “lazy” and co-opt anoth- incorporate new platforms and or organizations to which you’ve above the demands of a powerful stitutional amendment. er person’s message—Clubhouse ways of thinking? After all, we previously a xed yourself no lon- interest group. Elected o cials at’s how you win voters’ trust. seems to have solved for that with were just getting good at Twitter. ger re ect the values of who you more intimate, nuanced and re- at’s one way to look at it—be- are and what you believe.
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21cb0027.pdf RunDate 1/25/21 FULL PAGE Color: 4/C 6 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS
THE TECH TAKEAWAY Mike Gamson Why? You applied for jobs without the right Juggling is a great metaphor for something you feel Gamson, 46, is CEO of Relativity, a maker of legal and com- experience? pliance software and one of the city’s largest tech employers. is beyond your ability to do. It can be broken down He also is on the board of P33, a Chicago organization aimed My parents believed in promoting high into steps, and with a little help from someone at making the city a tech magnet. He and his wife live in the >self-esteem and independent deci- who’s been there, it can be acquired as a new skill. northern suburbs with their three children. By Laura Bianchi sion-making in their children. That I have taught hundreds of people to juggle. worked. I grew up feeling I could do
anything. > >
> An unexpected talent? Ha! Then what? How did When I was living in Spain my junior year in A close friend you prepare college, some street performers taught me how was in computer for a career What is your current favorite piece to juggle for money. Since then I always have jug- science. The dot- in tech? of tech? com boom was < An electric hydrofoil surfboard called a gling balls within arm’s reach. I bought 100 for our I was an art employees at Relativity when I rst joined as CEO. happening when and comparative Fliteboard. I took it out on the lake last I graduated from religions major. summer. When it’s going fast enough, the college, and there hydrofoil lifts it out of the water. Crazy. were an extraor- dinary number of jobs available How did you become in tech. I also successful? heard that tech was founded on Because the world is unfair. meritocracy. Just As a white man who grew up
work hard, and in the suburbs with a great > there was no limit school system and parents to what you could who loved each other, I was Most embarrassing career moment? raised in privilege. I had no achieve. > > I was in Beijing, emailing back and forth from my experience for the jobs I got, phone, trying to close a really important candidate but people reacted to what A piece of tech you dream about? for a job. I tried to forward the candidate’s salary they saw in me and said, “I request to the head of HR but forwarded their cur- bet he can do it,” versus, “I I can’t wait until we can project our memories on the wall for someone to experience as we rent salary and compensation history to the whole need proof that she can do company. Not my best work. it, or that a person of color recall them. It’s doable in our lifetime.
can do it.” >
BMO Harris may be Toronto’s star, but it takes brunt of job cuts The U.S. accounted for a record-breaking 43 percent of scal rst-quarter earnings for Canada’s BMO Financial Group. But partly at the price of more than 1,000 jobs.
BY STEVE DANIELS of the Canadian border. Meanwhile, in Canada, where e U.S. arm of Canada’s BMO BMO employs more than double Financial Group, led by Chica- the number it does in the U.S., the go-based BMO Harris Bank, has bank reduced its workforce by a shattered the record for how much little over 4 percent. it’s contributed to its parent’s prof- In late 2019, when BMO Finan- its. cial announced it would reduce U.S. operations accounted for jobs and cut costs in order to be- 43 percent of Toronto-based BMO come more e cient, there was Financial’s adjusted earnings in its no indication the cuts would be scal rst quarter, which ended borne more heavily in the U.S. Jan. 31. e bank reported earn- e Chicago area has shoul-
ings on Feb. 23. dered more than half the U.S. job MARTINEZ MANUEL In scal 2020, the U.S. contribut- losses. BMO employs about 6,500 BMO Harris Bank, led by CEO David Casper, and other U.S. businesses are providing virtually all of the momentum for their Canadian parent. ed 31 percent of adjusted earnings locally, down about 550 from for the Canadian parent. this time last year, according to a U.S. personal and commer- uted to BMO Financial’s pro ts So naturally we have a very pos- But, while BMO Harris and oth- spokesman. at’s an 8 percent re- cial banking, which corresponds last year was above historical aver- itive view on the U.S. We’re (pro- er U.S. businesses are providing duction. roughly with BMO Harris’ oper- ages. It wasn’t too many years ago jecting) 6 percent GDP growth for virtually all the momentum be- ations, generated $582 million in that the U.S. would have been for- 2021.” hind the Canadian bank’s current A TOP PLAYER net income, up 66 percent from tunate to provide 20 percent. “In the U.S., it’s not really a de- success, they also are paying a BMO Harris is Chicago’s sec- the same quarter the year before, BMO Financial CEO Darryl mand issue, it’s a supply issue,” higher price than their Canadian ond-largest bank by deposits and when the bank’s net income was White sees the U.S. as the bank’s BMO Harris CEO David Casper sister units in terms of cost-cut- one of its top commercial lenders. $351 million. Revenue was up only growth engine for the foreseeable told analysts. “We have a lot of our ting and lost jobs. e bank also is Wisconsin’s sec- 7 percent year over year to $1.1 bil- future. sectors that cannot get the inven- BMO in its fiscal first quarter ond-largest bank by deposits and lion. “We’re looking at an increase in tory they need. . . .So as supplies employed more than 1,000 fewer has a retail presence in eight other e much higher pro tability our view in the U.S., given the pace open up, as inventories open up, it workers than it did a year earli- states. was due to a 7 percent decline in of the vaccine rollout as well as the will just get better and better.” er, according to investor disclo- e cost-cutting has been hard expenses and a $138 million dif- higher probability of the stimu- Analysts didn’t ask about the sures. That amounts to nearly for BMO’s Chicago workforce, but ference in what BMO reserved for lus package going through at this disparate cost-cutting between an 8 percent reduction in force, it’s been good for the Canadian future loan losses. point,” White told analysts on the the two countries, and a spokes- leaving BMO with 12,355 south parent’s bottom line. e 31 percent the U.S. contrib- company’s Feb. 23 earnings call. man declines to comment.
P006_CCB_20210301.indd 6 2/26/21 3:32 PM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 7 COVID closed your building’s gym. Should you get a rent break? Lawsuit alleges a luxury high-rise violated the city’s landlord- tenant ordinance after shutting down many of its amenities BY ALBY GALLUN of Peak Properties, which man- ages about 8,000 apartments in For an average rent of nearly Chicago. “Every lawyer in the city $2,700 per month, residents at the will pick up on that. ere was not Streeter, a 49-story luxury high- a single landlord that didn’t shut rise in Streeterville, get to use the down amenities during the pan- building’s tness center, hot tubs, demic.” steam rooms and complimentary Village Green closed most of Starbucks co ee bar. Should they the common areas at its Chicago get a discount if those amenities properties, including the Street- are shut down due to a pandemic? er, and suspended all resident Michelle Weisberg thinks so. events and classes on March 13, Weisberg, a tenant in the 481-unit when Gov. J.B. Pritzker issued his tower at 345 E. Ohio St., has sued, stay-home order, according to the arguing exactly that. e suit con- lawsuit. Some, but not all, of the The tness center at the Streeter. tends that the owner and manager common areas and amenities at of the Streeter violated the city’s Village Green’s properties here open. But the pandemic has in- landlord-tenant ordinance by not reopened at the end of June, and creased other costs for landlords. reducing her rent to account for some remain closed, the com- Zucker estimates that Peak’s clean- Royal Bank offers commercial loans their decision to close most of its plaint says. ing expenses are about 10 percent common-area amenities as the Under the city’s landlord-tenant higher than they were pre-COVID. with attractive rates and terms. coronavirus spread last March. ordinance, “each Village Green Many downtown landlords have Weisberg says she’s entitled to a tenant impacted by the closure of also su ered from big drops in oc- refund, but her landlords won’t common area amenities in each cupancy and rent since last spring, Contact Andrew Morua, Senior Vice President give her one. Village Green building located in though the market may be turning Believing she’s not the only Chicago, including e Streeter, a corner. e Streeter’s occupancy 2IƓFH Ř0RELOH tenant who feels that way, Weis- are entitled to a refund of the por- rate has fallen to 87 percent, down (PDLO DPRUXD#UR\DOEDQNXV berg is asking a judge to certify her tion of the rent for these closures from 91.6 percent a year ago, ac- %LOLQJXDOŧ(QJOLVKDQG6SDQLVK case as a class-action complaint, due to the casualty,” the suit says. cording to CoStar Group, a real es- Putting community first since 1887. potentially adding hundreds, if e complaint alleges that Vil- tate data provider. Net rents at the not thousands, of residents to the lage Green and the pension plan building fell about 12 percent from suit. at could put the building’s also ran afoul of the Illinois Con- the rst quarter to the third quar- royal-bank.us manager on the hook for a large sumer Fraud & Deceptive Practices ter last year but are down about 5 Member FDIC /RFDWLRQVLQ&KLFDJR:HVWPRQWDQG1LOHV sum of money. e property man- Act because they failed to disclose percent now, according to CoStar. ager, an a liate of South eld, to tenants that they had violated Mich.-based Village Green, man- the landlord-tenant ordinance. ages eight properties in Chicago, Many apartment landlords have and their tenants should be in- tried to respond to residents un- cluded in the suit, according to the happy over cutbacks in amenities. complaint, led Feb. 16 in Cook Zucker estimates that about 100 County Circuit Court. tenants at Peak-managed build- It’s a question many apartment ings have raised the issue with the dwellers have asked during the rm. Zucker placated a few with pandemic. People pay top dollar rent credits, but he o ered the vast to live in some of the city’s most majority something else, like free expensive high-rises for the lo- online tness or cooking classes. cation, the views and amenities “We would handle it on a case- that have only become more ex- by-case basis, and many times travagant over the past decade or we’d have to get very creative,” he so. A swimming pool and tness says. “ e rst thing you want to center don’t cut it anymore: e do is gure out what’s getting their newest multifamily towers include goat.” demonstration kitchens, game Peak also tried to foster good- will with tenants by paying to bring ice- Trash talk. A TENANT IS ASKING A JUDGE TO cream or co ee trucks to its properties. e CERTIFY HER CASE AS A CLASS ACTION. owner of some Peak buildings sprung for Plow talk. rooms, wine-tasting events, even gift certi cates to local restau- boxing rings. rants. One of Peak’s most popu- ose extras are worth some- lar COVID amenities was a truck Tax talk. thing, but how much? Weisberg’s sta ed by bike mechanics who suit doesn’t state how much mon- would tune up tenants’ bikes on- ey she is seeking, and her attor- site, Zucker says. “People really Sound o on neys did not respond to requests appreciated that,” he says. for comment. A Village Green ex- Many big buildings are still re- how the city works. ecutive declines to comment, as stricting tenant access to ameni- does a spokesman for the owner ties. Peak, for instance, manages of the Streeter, the State Teachers a reservation system to limit the Retirement System of Ohio. number of people in tness cen- e case may go nowhere, but ters at its properties, Zucker says. if it gains some traction, copycat e lawsuit against Village Green suits could follow. alleges that its decision to reduce “ ere will be major implica- amenities has paid o nancial- BE A PART OF THE CHICAGO INDEX SURVEY tions if it goes somewhere,” says ly by reducing sta ng and other VISIT THECHICAGOINDEX.COM/SIGNUP Michael Zucker, managing partner costs it must absorb when they are
P007_CCB_20210301.indd 7 2/26/21 3:32 PM 8 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS National Guard deploys the shot troops Used to disaster and riot duty, the force mobilizes for vaccination campaign BY A.D. QUIG
A LONG, STRANGE YEAR for the Illinois National Guard is culminating in one of its longest and strangest do- mestic deployments: injecting vac- cines into hundreds of thousands of arms. “ ere is no comparison” to this year, says Maj. Gen. Richard Neely, the adjutant general of the state of Illinois, director of the Illinois De- partment of Military A airs and commander of both the Illinois Army and Air National Guard. In addition to the current vaccination campaign, the guard helped stand up large-scale testing sites, sup- port mortuary operations in Cook County and deliver isolation pods for use at the McCormick Place alternate care facility. In between, guard members were deployed on ood and wild re duty, responded to civil unrest in Chicago and ew to Washington, D.C., to protect the U.S. Capitol from insurrectionists. Roughly a month into the mis- sion, more than 1,000 service members were helping with the state’s COVID-19 vaccination ef- fort, with authorization to call up another thousand. ey sta 15 mass vaccination sites, assist local health departments and serve on mobile teams that will be deployed to communities with limited health care options, state prisons and independent-living facilities. Guard members have already administered more than 150,000
doses, and their current pace is BOEHM R. JOHN BY PHOTOS 11,000 doses per day. Early on, The Illinois National Guard, commanded by Maj. Gen. Richard Neely, is deployed to several vacci- they were delivering 11 percent of nation sites around the state, including this one at South Suburban College in South Holland. all of the state’s shots. e number of deployed service help, but we knew the vaccine was er term, where to target our specif- members and mass vaccination coming. It was going to be a large ic vaccination teams, and then we sites will only grow in the weeks lift for any state.” become the force generator that to come. e e ort takes close By the time Gov. J.B. Pritzker produces those teams and pushes coordination between the state’s called in January, the guard had a them to the eld,” Hible says. Local Department of Public Health, plan. “Two days later, we briefed health departments give the teams Emergency Management Agency senior sta , and four days later we their marching orders. and local health departments. briefed the governor,” Neely recalls. e state’s rst mass vaccination ey would use 18-member mil- site opened Jan. 26 at the Tinley ACTIVATION itary vaccination teams, or MVATs. Park Convention Center. It came e federal activation of 47,000 Six members are medical person- together in roughly a week, says National Guard personnel across nel trained to give shots. e other Cook County Health’s Ratna Kanu- the country to respond to the 12 are support sta ers who han- mury, who is heading up vaccina- pandemic was the second-largest dle everything from crowd and tion coordination. nationwide peacetime domestic trac control to security, records “It was rapid re,” Kanumury activation after Hurricane Katrina input and registration, taking tem- says. “We did a site survey on Sat- in 2005, says Paul Grasmehr, ref- peratures, observing people after urday (Jan. 16). By that ursday, erence coordinator at the Pritz- they’ve received shots, or shuttling the contract was nalized. We had ker Military Museum & Library. supplies and paperwork. supplies delivered Friday evening, Illinois guard ocials compare e guard has 52 MVATs today. and we were unpacking boxes on learn from those on the way out. those skeptical or scared of having the scale of this mission to the e rst 25 were “organic,” Neely Saturday,” setting up IT, testing In Winnebago County, the the military involved in the e ort, response to the Great Flood of says, or all National Guard mem- walkie-talkies and working with guard is working alongside a vol- she says. Plus, guard members 1993—when 7,000 members were bers. e rest are a mix of guard pharmacy partners to ensure vac- unteer medical reserve corps and bring a lot from their civilian life; activated—and the deployment of and contracted medical personnel cine storage was adequate. public health workers at a vacci- some know di erent languages the 2,600-member 33rd Infantry to administer shots. nation site at Sandy Hollow, and or IT workarounds, for example. Brigade to Afghanistan in 2009. Early snags involved fusing STAFFING it is rolling out mobile vaccination Others are familiar faces from the “What we are very well trained military, medical and emergen- e guard is fully stang the units going to workplaces to vacci- local community. to do is take the concept of a wick- cy management lingo, state and Tinley Park site with eight MVAT nate teachers, grocery store clerks, Who picks up the tab? While ed problem and breaking it down,” guard ocials say. Having worked teams, supervised by Cook Coun- transit drivers and workers in fac- governors control service mem- says Col. Seth Hible, an opera- together on testing sites and hav- ty Health. At full capacity, the tories and food-processing plants. bers, the federal Department of tions ocer whose full-time job is ing team members embedded in site can vaccinate 3,500 people “We’d been experiencing very Defense will pay until at least teaching at Lake Park High School each other’s oces helped. Hible every day. Guard members are high rates of infection and high March 31. So far, the state has in Roselle. Floods, storms and war- likened the collaboration to his also helping at the county’s vac- rates of morbidity, mortality,” plus spent $2.4 million for medical zone deployments are well-worn work with State and Defense ep- cination sites at Triton and South a lengthy mitigation shutdown, stang, supplies and equipment. sections of the National Guard artment ocials in Afghanistan. Suburban colleges and at several says Dr. Sandra Martell, Winneba- “We are expecting that this could playbook. But there was no script “IEMA, for the most part, is look- CCH clinics. e only dicul- go’s public health administrator. cost as much as $100 million,” for a pandemic like this one. ing longer term to try and gure ty has been training new sta as “We knew we had to pick up the IEMA Deputy Director Scott Swin- In the fall, Neely told his team to out how the guard will be relieved guard members complete their pace.” ford says, which will be fully reim- think through the likely challenges from this mission in about two or tours and others replace them. Having civilians work along- bursed. “We appreciate the federal of a mass vaccination program. “At three months or however long it Ocials have opted to have some side uniformed guard members government’s assistance mone- that point IDPH hadn’t asked for takes. IDPH is looking for the short- overlap so new members can helped alleviate any concerns by tarily and getting us through this.”
P008_CCB_20210301.indd 8 2/26/21 3:31 PM MORE THAN EVER, OUR CHILDREN NEED US.
Because of COVID-19, hunger has more than doubled. And children are particularly at risk; one in three households with children is facing hunger. As job loss and the continued economic downturn push more people to the end of their resources, many families are having to choose between paying bills or buying food.
In four decades of feeding our community, we have never faced a need so great. WE NEED YOU.
DONATE NOW chicagosfoodbank.org/givenow
21cb0021.pdf RunDate 1/18/21 FULL PAGE Color: 4/C 10 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS
EDITORIAL Illinois is its own worst enemy t may be too soon to take the weather-re- need to link a renewed graduated income tax lated infrastructure catastrophes of recent Illinois’ new proposal to pension funding. It’s a slim reed to weeks in Texas and elsewhere down South speaker of the hang hope on, to be sure, but it’s something: as a cue to tout this state’s advantages as House, Chris Welch a sign that new leadership in the Statehouse Ia place to do business. And yet, the compar- may nally appreciate the gravity of the pen- isons can and should at some point be made. sion situation. After all, Chicago and Illinois have much to Cahill is right to argue that the next step o er any company: A reliable electric delivery Welch and Gov. J.B. Pritzker should take is system fueled in part by nuclear power and to allow Illinoisans to vote on a standalone connected to the wider grid beyond Illinois. A amendment repealing the so-called pension central location with highway and rail access protection clause in the Illinois Constitution. to all points on the continent. Abundant fresh If that passed—and there’s reason to think it water via Lake Michigan. Two major airports: would—the state could begin defusing the One, an international colossus touting direct pension bomb by limiting the cost-of-living connections throughout the globe; another increases that are currently in ating our pen- close to downtown. Globally recognized uni- sion obligations. versities, including the University of Chicago, Similarly, Hinz correctly contends in this Northwestern University and the University of week’s issue that Pritzker is pushing a $932 Illinois. Five academic medical centers, plus million tax hike on business at precisely the the Shirley Ryan AbilityLab and Lurie Chil- wrong time, as population and jobs have be- dren’s Hospital, drawing talent and patients gun to drop not only downstate but in the met-
from around the world. Two federal research PRESS ASSOCIATED ropolitan area. He quotes corporate-location laboratories. A public transit system that few consultants who warn that such a tax increase U.S. cities can match. A well-connected cor- 2 percent, with much of that drop-o coming graft, cronyism and palm-greasing are such now will make companies think twice about porate leadership community with sincere in- from economically challenged regions down- a tradition here that it’s become a brand: the moving to Illinois—and will add momentum terest in civic issues. A beautiful metro down- state. e demographers he interviewed for Chicago Way. Meanwhile, the pension crisis to those who are already here but thinking of town and lakefront. Arts, culture, restaurants, that report were quick to point out that other is inescapably large, and yet we continue to pulling up stakes. museums, architecture, libraries. People who Rust Belt states haven’t exactly set the world elect people who seem unable or unwilling to According to the Tax Foundation, the tax understand how to drive in snow. on re over that same span of time, either, but do the work of xing it. changes Pritzker advocates would reduce Illi- Viewed through this lens, you have to ask that’s cold comfort. ose states don’t have A faint glimmer of hope emerged the other nois’ business-tax-climate rating from a weak why the story of Chicago and Illinois right now nearly the same attractions and advantages day, however, and Crain’s columnist Joe Cahill 36th of the 50 states to an even less inspiring isn’t one of tremendous growth and possibil- that Illinois can boast. shines a light on it in this week’s issue. Illinois’ 39th. ity. And yet, the drumbeat of drain-circling And that brings us to the cloud that hangs new speaker of the House, Chris Welch, seems Illinois has little hope of leveraging—or data continues. As Crain’s columnist Greg over us, obscuring each of the bene ts listed to realize government won’t gain public con- even retaining—all of its inherent strengths if Hinz recently reported, the Census Bureau above: our well-earned reputation for political dence without addressing the pension fund- we continue to undermine ourselves with tax estimates Illinois’ population has declined by dysfunction. e city and the state’s appall- ing crisis devouring state nances. Welch and public pension policies that drive away roughly 250,000 over the past decade, or about ing nancial condition are well-known, and signaled as much when he acknowledged the business investment.
YOUR VIEW It’s time to rethink heat in Chicago If ever there was an absolute certainty, consistent year-round, and piping that en- ty. Unlike gas distribution, this backbone it’s that the controversial Peoples Gas pipe- ergy to an electric heat pump makes for a could be built a block or blocks at a time as line-replacement program is setting up more ecient and comfortable home than demand grows—because it doesn’t need to Chicago residents for an economic disaster, a gas furnace. As the technology advances be connected to a centralized interstate gas unless we act now. and eciency improves, the price tag for pipeline. e company’s decades-long plan to re- heat pumps has declined, a trajectory quite A potential additional benefit: Chicago place gas mains throughout the city has the opposite of the costly Peoples Gas sys- could retain an equity share in the private- more than tripled in projected costs, been tem. ly operated utility. This equity arrange- plagued by delays and mismanagement To date, this has not been a viable option ment would create a new annual revenue and set the city back in ghting climate for urban environments, as geothermal sys- stream for the city for use of our subterra- change. While that has proven pro table Brendan Reilly (left) is alderman of the tems require pipe to be laid horizontally in nean infrastructure. A potential win-win for Peoples Gas, it has become una ord- 42nd Ward and president pro tem of the a backyard or vertically in deep wells. ere scenario. able and unworkable for consumers. City Council. David Kolata is executive is simply not the space for that on private e possibility of creating a geothermal e average Chicago household is now director of the Citizens Utility Board. property in Chicago’s neighborhoods. is utility will require discussion among a di- paying more than $130 annually exclusive- is where the city can step in. verse group of stakeholders. But the even- ly to nance Peoples’ pipeline-replacement cal to the city of Chicago’s climate change Just as local government has granted a tual transition to electri ed heat is inevita- program, and that is only going higher. e goals. Natural gas is a carbon-producing polluting, expensive heating company a ble, whether we act or not. resulting squeeze on family budgets has fuel and will have to be phased out for heat- charter to distribute their heat beneath our As the cost of the Peoples pipeline-re- been proven by the alarming proliferation ing homes by 2050. As such, every lineal streets, the city should create the same op- placement program skyrockets, demand of disconnection notices for service in the foot of new gas main line that Peoples Gas portunity for a new, carbon-free heating for an a ordable alternative will only grow. city. is permitted to install only further widens utility. It would use that same ground un- e key questions are: Will we seize on In September 2020, roughly 30 percent of the carbon footprint chasm the city must der our streets to deliver heat more cost-ef- this opportunity to use technology to re- Peoples’ customers received disconnection bridge in order to meet our environmental fectively to residents. duce heating bills and our reliance on fos- warnings. Ponder that: Nearly 1 in 3 cus- objectives. A modular, geothermal backbone un- sil fuels? Or will we allow Peoples Gas to tomers in Chicago can’t a ord to pay their e answer might be under our feet. derneath the city could allow residents to charge consumers higher bills to build ex- monthly gas bill—in the summertime. Geothermal energy—which leverages the opt in to an energy alternative that better pensive new infrastructure that is soon to It will only get worse. earth’s heat—is a proven and cost-e ective meets their needs and positions Chicago be obsolete? Even if consumers could a ord the option for keeping homes and businesses as a national leader in supporting commu- Chicago utility customers deserve an an- pipe-replacement program, it is antitheti- warm. e temperature underground stays nities being bankrupted by their gas utili- swer to these questions, sooner than later.
Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters Sound o : Send a column for the Opinion page to editor@ to Crain’s Chicago Business, 150 N. Michigan Ave., Chicago, IL 60601, or email us at [email protected]. Please chicagobusiness.com. Please include a phone number for veri cation include your full name, the city from which you’re writing and a phone number for fact-checking purposes. purposes, and limit submissions to 425 words or fewer.
P010-P011_CCB_20210301.indd 10 2/26/21 5:42 PM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 11 READERS RESPOND
Readers responded to stories on ChicagoBusiness.com. Join the conversation: works) and no chances of natural disasters cut through red tape to e ciently use exist- Tell us what you think on our Facebook page or on Twitter, @CrainsChicago. (hurricanes, oods, tornadoes, etc.) that can ing private citizen-funded infrastructure to disrupt data centers. rapidly distribute vaccines to the local com- Vegas gets the occasional aftershock when munity. I bet his testing sites could quickly “5 steps to faster COVID vaccinations in “Illinois bids for NYSE data hub—but L.A. gets a quake, but it’s minimal in Las Ve- pivot to distribute a couple thousand vac- Illinois” (Feb. 12): the door may be open to a bigger move” gas. — omas Payne Via Facebook cines a day if they had access to enough dos- (Feb. 10): es. —Kevin Koenig Via Facebook Websites that aggregate the availability and “How one doctor ghts the pandemic— location of vaccine providers. User friendly Sounds like another Amazon headquarters pro tably” (Feb. 12): is is no dierent than Walgreens or CVS, websites. Volunteers to assist elderly who are story where cities and states compete for a except it’s a local entrepreneur. Good for not computer-savvy to make appointments race to the bottom. It will be tempests in tea- Capitalism is what drives job creation and him. —Rationalist @Chiiiicago Via Twitter and to provide safe transportation. Set up in pots, and the end result will be the NYSE will tax dollars, two crucial issues this city des- community centers, schools, churches as vac- stay put. —Greg Lydon Via Facebook perately needs improvement on if it hopes “Apprenticeships are the catalyst for op- cination centers in communities, just like vot- to remaining a thriving area. So he’s previ- portunity” (Feb. 12): ing, to get young people vaccinated easily and Not a chance. ey are leaving because of ously praised for a rapid response in a time e ciently when their turn comes. Mobil units high taxes. Why move from one high tax area of need by Crain’s, and now bashed for 100%. We have a huge group of Americans like blood donation vehicles outside places of to another? pro ting as a small-business owner? What that should be part of the American dream. work. Not rocket science. Let’s get this done the If they leave it would be for a lower tax changed? We shouldn’t be importing workers when old fashioned way. Plan, mobilize, get shots in place. Possibly even Las Vegas. Why Vegas? It isn’t any business owner’s fault that we should be investing in our own. —SPEN arms. —Barbara Stevens Via Facebook Lots of ber connections (high-speed net- their particular city/state cannot aord or @papen_s Via Twitter
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P010-P011_CCB_20210301.indd 11 2/26/21 5:35 PM 12 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS A GALA SEASON LIKE NO OTHER
The pandemic took 2020’s fundraising season from big ballrooms to small screens—and for many organizations, it worked out just fine. BY LISA BERTAGNOLI
Everything was set for the Illinois Holocaust Museum’s Humanitarian Awards Dinner to take place on March 12, 2020. Sponsors were lined up, the ballroom at the Hyatt Regency Chicago was booked, owers and food were ordered, and guests were ready to enjoy the evening, which was
expected to bring in north of $2 million. COLLECTIVE STREET CLARK e week before, the country felt the grip of JDRF’s virtual gala allowed guests from across the country to view the festivities. The event’s net stood at $8.56 million that night and later rose to $8.76 million. COVID-19 beginning to squeeze. e idea of a ballroom packed with 1,700 people, among them nonagenarian Holocaust survivors, caused mu- JDRF ILLINOIS ONE DREAM JUF LION LUNCHEON ILLINOIS HOLOCAUST seum o cials to reconsider. “We decided that the GALA CLOSE TO HOME Net proceeds: $2.8 million MUSEUM 2020 HUMANITAR risk was much too high,” says CEO Susan Abrams. Net: $8.76 million When: Oct. 15 IAN AWARDS DINNER Days before the dinner, Abrams and Ken Cooper, When: Dec. 12 Where: Hosted on a custom Net: $2.4 million vice president of development, made hundreds of phone calls to sponsors and guests to tell them the Where: Virtual broadcast website When: March 12 event was o . Only a few requested refunds, so the Attendance: 500 households Attendance: 394 Where: Was scheduled to take museum went on to net $2.4 million, on par with Individual ticket: $525 Individual ticket: $36/$72 with place at Hyatt Regency Chicago prior years, from an event suggested donation; dinner a delivered box lunch Attendance: 1,700 expected THE PANDEMIC SPURRED that did not happen. packages $750-$20,000 Of note: The virtual edition of before cancellation Last March and the Of note: Thanks to a $1 million and this annual event featured Individual ticket: $500 INDIVIDUAL DONORS AND coronavirus news kicked $2 million gift and lower expenses, psychotherapist and author Lori Of note: Organizers canceled due o a gala season like no SPONSORS TO DONATE this event broke last year’s record Gottlieb. Attendance was up 21 other. Organizations, to COVID-19 and spent days calling net of $6.2 million. Programming percent and the event raised MORE MONEY. . . . AS many with big money- sponsors and ticket holders. Only making events already featured a concert from singer- $300,000 more than the year a few requested refunds, enabling A BONUS, MANY planned, either canceled songwriter John Ondrasik of Five prior. the event to net just $100,000 less them or took them virtu- For Fighting. than in 2019. NONPROFITS REACHED al, retooling big-ballroom ST. IGNATIUS COLLEGE PREP NATIONAL AND EVEN festivities for the small U.S. HOLOCAUST MEMORIAL GLORIAM AMERICAN HEART screens of Zoom and MUSEUM “WHAT YOU DO GLOBAL AUDIENCES. YouTube. Net: $2.5 million ASSOCIATION HEART BALL e surprise? Net pro- MATTERS” RISA K. LAMBERT When: March 7 Net: $2.3 million ceeds that surpassed or equaled those of in-person CHICAGO VIRTUAL EVENT Where: St. Ignatius College Prep When: June 25 events. Overhead shrank, with no need to serve Net: $4.15 million Attendance: 821 Where: Zoom guests food and drink. e pandemic spurred indi- When: Sept. 15 Individual ticket: $500 Attendance: 700 vidual donors and sponsors to donate more money, Where: Museum’s website and enabling quite a few organizations to o er free ad- Of note: This annual event raises Individual ticket: Free Facebook page and YouTube mission to galas (in normal times, individual tickets money for tuition-assistance Of note: The event attracted guests can be as much as $1,500). As a bonus, many non- Premiere scholarships. The event raised from around the country, who prots reached national and even global audiences Attendance: 2,000 households $500,000 more than in 2019, and participated in an interactive chat. with their virtual programs, particularly those re- Individual ticket: $250 a paddle raise accounted for $1.1 Chicago-based band Maggie Speaks corded and posted on YouTube or another site after suggested donation million of proceeds. performed at the virtual after-party. the event. Of note: Programming featured Virtuality created opportunity for new experi- former white supremacist Derek ences, too. Field Museum’s CEO and newest cu- Black; the luncheon honored Mally rator took attendees on behind-the-scenes tours of rareed museum space, a treat not possible Zoberman Rutkoff, the daughter of with 800 real-live guests. e Museum of Science two Holocaust survivors. & Industry sent creativity kits to registered guests, enabling families to participate in its Columbian CHICAGO AUTO SHOW FIRST Ball, in calmer times a black-tie a air. LOOK FOR CHARITY Drawbacks? Producing events “is a little more Net: $2.95 million complicated” virtually, says David Kelly, president of Chicago-based Frost Productions, a production When: Feb. 7 rm that handled several of 2020’s virtual fund- Where: McCormick Place raising events. Both clients and guests miss the Attendance: 8,508 energy and social elements of an in-real-life gala, Individual ticket: $275 and while virtual events have proven to be e - Of note: The cocktail party, an an- cient fundraisers, “the desire is there to go back to the way things were,” Kelly says. nual affair that raises money for 18 For the foreseeable future, the show will go on—on Chicago charities, was one of the few in-real-life fundraising events Zoom, YouTube and other virtual platforms. Here’s a SMUTNY DIANE look at the 20 highest-netting galas of 2020 and how of 2020, held before the pandemic One of the few in-real-life galas of 2020, St. Ignatius College Prep’s Gloriam netted $2.5 million for tuition- organizations made the new normal work for them. started. assistance scholarships.
P012-P013_CCB_20210301.indd 12 2/25/21 11:11 AM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 13
ANN & ROBERT H. LURIE MISERICORDIA HEART CHILDREN’S HOSPITAL OF OF MERCY 60TH ANNUAL CHICAGO REIMAGINED FAMILY ASSOCIATION CHILDREN’S BALL BENEFIT Net proceeds: $2.1 million Net: $1.405 million When: Dec. 12 When: June 20 Where: Zoom Where: YouTube Attendance: 94 networks/bubbles/ Attendance: 3,000 households/watch parties Individual ticket: Free Individual ticket: Free Of note: Misericordia parents Of note: Programming featuring planned and coordinated the event Gio, a patient with myotubular in about three months. Caroline Ken- myopathy, helped raise money for nedy, Joe Maddon, Mike Ditka and the hospital’s Children’s Research Mayor Lori Lightfoot were among Fund. the boldface-name participants.
AFTER SCHOOL CHICAGO COUNCIL ON MATTERS CELEBRATING GLOBAL AFFAIRS GLOBAL #ASMTOGETHER LEADERSHIP AWARDS DINNER Net: $2 million Net: $1.4 million When: Sept. 22 When: Oct. 28 Where: YouTube Where: YouTube Attendance: 2,300 views Attendance: 1,300 YouTube views altogether (day of event and after) Individual ticket: Free Individual ticket price: Free Of note: Honorees included Of note: ASM generated Chicago Community Trust CEO excitement for the fundraiser by Dr. Helene Gayle; the no-cost sharing videos from Chicago Bear individual ticket was thanks to sup- KYLE FLUBACKER KYLE
CLARK STREET COLLECTIVE STREET CLARK port from 57 sponsors. Tarik Cohen and the Cubs’ Ian Jingmai O’Connor, left, associate curator of fossil reptiles, and Field CEO Julian Siggers led Field Museum gala guests on virtual behind-the-scenes Happ on social media before the tours of the museum. event. MUSEUM OF SCIENCE & AMERICAN RED CROSS OF INDUSTRY COLUMBIAN BALL AMERICAN CANCER ILLINOIS: HEROES BREAKFAST Net: $1.4 million SOCIETY DIGITAL Net: $1.837 million When: Oct. 10 DISCOVERY BALL When: May 7 Where: Event LiveStream site Net: $1.9 million Where: Zoom Attendance: 600 When: May 21 Attendees: 500 Individual ticket: $100; Where: Streamed on YouTube Individual ticket: Sponsorship sponsorships $2,500 and up Attendance: 6,000-plus views levels $5,000 to $100,000 Of note: “Columbian Ball Kits” Individual ticket: Free Of note: Two large gifts helped the including a recipe for a signature Of note: The virtual event helped virtual event net almost $400,000 cocktail, props for selfies and DIY bring more bidders to the online more than last year for breakfast, projects helped engage participants auction, a major source of funds traditionally held at the Hilton in the virtual event. for the event. Hyatt CEO Mark Hoplamazian and investor Sam Zell spoke at the virtual Invest For Kids Chicago. The 2020 Heroes were investors conference, which has raised $16 million over 12 years to support Chicago-area honored at the virtual event and 12TH ANNUAL INVEST FOR FIELD MUSEUM VIRTUAL children’s charities. on social media. KIDS CONFERENCE NIGHT AT THE MUSEUM Net: $1.34 million Net: $1.9 million CURE EPILEPSY COMBINED, METROPOLITAN FAMILY When: Oct. 21 UNITE TO CURE EPILEPSY SERVICES MPOWER THE When: Oct. 17 THE EVENTS Where: Event site Where: YouTube and Net: $1.84 million NIGHT Attendance: 850 museum’s website When: Sept. 24 ON THIS LIST Net: $1.49 million Individual ticket: $1,000 Attendance: 700 households the Where: Facebook and YouTube RAISED MORE When: Nov. 12 Of note: Appearances by Sam night of; about 1,500 total Attendees: 7,100 Where: Zoom and organization’s Zell and Hyatt Hotels CEO Mark Individual ticket: Free Individual ticket: Free THAN website Hoplamazian helped boost net for Of note: Programming featured Of note: Programming $47.2 MILLION. Attendance: 2,608 registered guests this annual investors conference, curator-led, behind-the-scenes tours featured musicians Eric Church Individual ticket: Free which has raised $16 million for of rare fossils, the museum’s anthro- and Nils Lofgren, Dr. Sanjay Gupta SEVENTEEN Of note: The event highlighted Chicago-based children’s charities. pology storage space and its private and “Hamilton” actor Miguel OF THESE the effects of gun violence and gem vault. Jane Goodall also made Cervantes with other Broadway how to establish and maintain GASTRO INTESTINAL an appearance. stars. EVENTS peace in Chicago. Speakers RESEARCH FOUNDATION WERE HELD included members of rival street VIRTUAL BALL organizations and leaders from Net: $1.3 million VIRTUALLY. street-outreach initiatives. When: July 25 THE SIZE OF Where: Zoom ADLER PLANETARIUM Attendance: 660 THE GALAS VIRTUAL CELESTIAL BALL Individual ticket: Free; donations RANGED FROM Net: $1.45 million accepted When: Sept. 12 Of note: Entertainment included an 94 HOUSE- Where: YouTube Premiere improv performance by Second City, HOLDS TO Attendance: 650 during the live music, a paddle raise and a pre- event; total of 1,700 watched the sentation by Dr. David T. Rubin, the 8,508 PEOPLE. link within the first week foundation’s lead scientific adviser. Individual ticket: Free; suggested $25 donation NOTES: Chart based on available information. Some traditional events did not take place, for Of note: Lower costs enabled Adler instance Shedd Aquarium’s and Lincoln Park to net about the same as in past Zoo’s galas, Make-A-Wish Illinois’ Wish Ball, Shir- ley Ryan AbilityLab’s Spark! and Big Shoulders
DIANE SMUTNY DIANE years. The virtual event also al- Fund’s biennial Humanitarian Awards Dinner. Country music star Eric Church was one of several celebrities to appear at CURE Epilepsy’s Unite to CURE lowed families to participate in the Sources: Crain’s research; data from nonprofits Epilepsy virtual fundraiser, which netted $1.84 million. festivities.
P012-P013_CCB_20210301.indd 13 2/25/21 11:11 AM ARCHITECTURE PROFESSIONAL STAFFING / RECRUITING Advertising Section HKS, Inc., Chicago Objective Paradigm, Chicago HKS is pleased to PEOPLE ON THE MOVE Objective Paradigm is announce the promotion pleased to announce of Bernie Woytek to To place your listing, visit www.chicagobusiness.com/peoplemoves that efforts to expand Associate Principal. their family of specialized As Project Manager at or, for more information, contact Debora Stein at 917.226.5470 / [email protected] staffing and recruiting HKS, he has frequently services firms will be led been recognized for by new Chief Executive outstanding achievements and BANKING / FINANCE HEALTH CARE LAW Officer, David Morgan. David brings instrumental in growing our Mission a wealth of leadership and domain Critical practice. Bernie is recognized Chartwell Financial Advisory, Chicago Alden Management Services, Freeborn & Peters LLP, Chicago expertise to this role, having led for his strengths in addressing Chicago multiple staffing organizations through technical issues, engineering Ryan Rassin has joined Freeborn & Peters LLP significant growth and development. coordination and construction Chartwell’s corporate Alden Management is pleased to announce David is taking the helm of the practices. Bernie successfully finance team as a Services announces that Partner Jill C. Objective Paradigm family of staffing collaborates with HKS teams across Director. Ryan will the promotion of Anderson has been and recruiting services firms at a critical all market sectors on technology- lead the execution of Margo L. Marasa, MPH, elected to the Firm’s point in their continued evolution. intensive projects around the world. capital markets-related BSN, LNHA to Chief Executive Committee. transactions, focusing Operating Officer. With Jill is a Partner in the on debt and equity placement, more than a decade Litigation Practice Group and Co- while also originating capital raising of leadership experience at Alden Leader of the firm’s Closely Held opportunities from lower- to middle- Management Services, Marasa’s Companies Team. Jill represents REAL ESTATE market private equity firms. Ryan extensive operational leadership and clients in appellate matters and all ARCHITECTURE / DESIGN brings over 20 years of experience clinical skillset will allow her to focus phases of litigation, with a particular Advocate Commercial Real Estate as a principal investor to Chartwell greatly on day to day operations and focus on critical and dispositive Advisors & ProTen Realty, Chicago Gensler, Chicago and has originated and structured outcomes while ensuring efficiency trial motions in complex cases. Her capital solutions for clients for a and a continued commitment to experience includes a wide range of Advocate Commercial Gensler Chicago variety of transaction types across providing the best healthcare and state and federal commercial matters Real Estate Advisors and welcomes two senior numerous industries. senior living options for those served and complex disputes. ProTen Realty Group are leaders to its team. throughout The Alden Network. pleased to announce the Hassan Gardezi, AIA, merger of their two firms. OAA, NCARB, LEED The firm will continue GA joins as Healthcare under the Advocate Market Leader with over INFO TECHNOLOGY name. Renee Betzelos, Betzelos Gardezi 24 years of experience LAW Kurt Walsh, and Art building and leading BCD International, Buffalo Grove Clamage co-founders strong, multi-disciplinary of ProTen, will become Freeborn & Peters LLP, Chicago teams for complex global Assessing global trends Co-Managing Principal, healthcare projects. His CONSULTING Executive Vice President amid the pandemic, Freeborn & Peters LLP proven communication, and Senior Managing BCD saw their essential is pleased to announce planning, management, HealthScape Advisors, Chicago Director, respectively, manufacturer position that Partner Philip L. and operations skills of Advocate. This escalating. In recognition Comella has been will be of direct benefit HealthScape Advisors combination brings of his insight and supply elected to the Firm’s Walsh to clients and the firm’s is pleased to welcome together two of the Parrella chain strategy, which Executive Committee. healthcare practice. Kevin Mehta as a Midwest’s most active commercial empowered BCD to exceed industry Phil is a Partner in the Enza Parrella, IIDA joins as Managing Director. real estate firms focused solely on standards, Alexander Burgess has Litigation Practice Group and Leader Workplace Account Leader, bringing Kevin is a recognized representing the interests of tenants. been promoted to Vice President, of the Environment and Energy three decades of experience as industry leader It expands the service offerings and Global Supply Chain Operations. Practice Group. Phil’s practice spans a strategic workplace planner, focused on helping resources of the group with an eye BCD’s products support video both regulatory counseling and designer, and director. She has been payers, providers and employers toward continued growth. With offices surveillance technology utilized by the environmental-based litigation. He has accountable for millions of square feet operationalize their value-based in both Chicago and Detroit markets, US Government, law enforcement, over three decades of experience in of interior workplace environments, healthcare programs. He brings the firm has seasoned professionals healthcare, and other key industries. environmental law, and focuses on the working with C-level leaders of a career of experience building providing representation to clients on Burgess’ leadership has fostered solid and hazardous waste industry. Fortune 500 companies. Enza is active innovative solutions and developing worldwide expansion. a national basis. in DIFFA and City of Hope REACH. asset-based product offerings that focus on leveraging data to generate impactful insights, allowing payers and providers to focus on what REAL ESTATE matters most – the quadruple aim. LAW Project Management Advisors, Inc., ARCHITECTURE / DESIGN Chicago INVESTMENT Thompson Coburn LLP, Chicago Lamar Johnson Collaborative, Douglas Daniels joins Chicago Sandbox Industries / Sandbox Lesley Wynes has been Project Management Insurtech Ventures, Chicago promoted to Thompson Advisors, Inc. (PMA) Lamar Johnson Collaborative Coburn’s Chief Legal as Director of Human welcomes Lesley Roth, Sandbox Industries and Talent Officer. In this Resources. A veteran of AIA as Principal. In her its insurtech investment role, Lesley will expand the world’s most well- 20-year career, Lesley’s platform, Sandbox her recruiting efforts to known consulting firms, professional training and Insurtech Ventures, is all attorney hires, from Daniels will play an instrumental role practice include domestic FINANCIAL SERVICES pleased to announce lateral partners to associates and in supporting PMA’s continued growth. and international that Michelle Gouveia counsel and to law students selected He will lead the human resources architecture and urban design with JAG Capital Management / has been promoted for its summer associate program. team in recruiting, onboarding, an emphasis on public engagement, JA Glynn Private Wealth, to Vice President. For Sandbox She will continue to develop and and advancing top talent, with an liveable communities and sustainability. Chicago & St. Louis Insurtech Ventures, Gouveia helps implement innovative integration immediate focus on creating a holistic Lesley holds a Master’s in planning manage the team’s investments in programs for new partners, focused DEI strategy and implementing a and policy from the University of JAG welcomes two Data Dimensions and Layr, and serves on building on attorneys’ individual career development platform to Illinois at Chicago and a B.Arch from new research analysts. as a Board Observer for portfolio strengths and connecting them with broaden and deepen the firm’s talent the University of Oregon. She is a Cynthia Ma joins JAG as companies Gradient AI and Indico. mentors and advocates across the pool and service capabilities. certified urban planner and licensed a Senior Fixed Income Prior to Sandbox, Gouveia was a Firm’s six offices. architect in the state of Illinois. Analyst, conducting Strategic Initiatives Manager at The fundamental research Hartford Steam Boiler Inspection and for multiple strategies. Insurance Company (HSB). She has 14 years of Ma experience in the TECHNOLOGY investment management PHARMACEUTICAL ARCHITECTURE / ENGINEERING industry, including Numerator, Chicago several years as a senior Orphazyme, Chicago CannonDesign, Chicago credit analyst at Natixis Numerator, a data and Asset Management. LAW Sulin Shah joined tech company serving Alexandra Shinewald, Cynthia earned an MBA Orphazyme as U.S. the market research in Finance from the AIA, LEED AP BD+C, Elrod Freidman LLP, Chicago General Counsel and a industry, announced that joins CannonDesign University of Iowa. She O’Neil member of the company’s Bridgette Heller joined is a CFA® charterholder as Chicago Education Liz Butler has joined Elrod U.S. leadership team. its Board of Directors as and a member of the CFA Society. Practice Leader. Alix Friedman LLP, focusing Orphazyme is preparing of January 2021. Heller Tucker O’Neil joins JAG as a Junior is responsible for the her practice on land use, to launch its first rare has held senior executive leadership Equity Research Analyst focusing continued growth of zoning, entitlements, disease treatment. Shah earned his roles at Danone, Merck & Co., on healthcare companies. He the office’s education practice, urban planning, public JD at Northwestern University and Johnson & Johnson and Kraft Heinz will also spearhead key data and concentrating on STEM and S&T, incentives, historic has more than 15 years of global over her 35-year career, and is a technology initiatives across JAG’s and will serve as a member of the preservation, economic healthcare experience. Orphazyme Board Member at Novartis, Dexcom, equity strategies. Previously, Tucker Chicago leadership team. “I’m development, and general real estate is a late-stage biopharmaceutical Aramark and Newman’s Own. Heller spent four years working at FactSet excited to be part of CannonDesign transactions. Prior to joining Elrod company with its U.S. headquarters also serves on the Board of Trustees Research Systems. He received his and bring my experience to build Friedman, Liz was in the land use in Chicago and its global offices in at Northwestern University, and is BS in Finance from Indiana University. upon its successful framework, to group at DLA Piper. She began her Copenhagen, Denmark. the CEO/Co-Founder of the Shirley continue to grow the firm’s leadership professional career in the public Proctor Puller Foundation. in education and to create life-long sector as a municipal planner in the partnerships with our clients.” Dallas, Texas metro area. CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 15 Exelon mulling Texas exit after winter disaster The energy giant will pay millions for the failure of three large gas plants during the reliability crisis last month
BY STEVE DANIELS as, which together accounted for about 30,000 megawatts, was a crit- Exelon is considering pulling out ical part of the multiday outages. of the Texas market. Exelon’s three plants make up more On a day in which the Chica- than 10 percent of the total that go-based energy giant disclosed were o ine. long-anticipated plans to break it- e event alone is a major con- self up, the company found its posi- tributor to what’s shaping up as tive news—at least to the ears of in- a disappointing earnings perfor- vestors—overshadowed somewhat mance in 2021. Exelon’s adjusted Last month’s energy crisis in Texas left more than 4 million homes and businesses without heat, light and water during a deep winter freeze. by the disaster in Texas last month operating earnings guidance for when power plants failed and large 2021 ranges from $2.60 per share to ners where safety is concerned.” problem at the plants in Texas, al- Texas has contemplated intro- swaths of the state froze in the dark $3.00 per share. For last year, it post- e spokesman didn’t address though he didn’t elaborate. e ducing such charges in the past, for days. ed $3.22. whether maintenance otherwise company also cited di culties in but it hasn’t happened thanks in Exelon estimated the hit to earn- Exelon expects the hit to earnings planned at Illinois nukes was be- procuring gas during a period in part to opposition from large in- ings from operational failures of from Texas alone to be about 20 ing delayed due to the heavy Texas which many wells weren’t oper- dustrial power users. Crane said the three large natural gas-red power cents per share. And that’s only after losses. ating and there was heavy heating response of Texas to the disaster in plants in Texas to be between $560 it takes mitigation measures that the For Crane, who joined Exelon’s demand. Generators in Texas have terms of overhauling its market sys- million and $710 million after tax. company hopes will trim $410 mil- predecessor as a nuclear-plant boss come under heavy criticism since tem would determine what direc- e before-tax cost is up to $950 lion to $490 million from the price in the late 1990s and moved up the the outages for failing to properly tion Exelon takes in the state. million. tag for the failure. ranks within the generation divi- winterize their facilities. “We want to participate in a mar- “ is loss is not acceptable to us,” Among those actions: “deferral sion, the Texas asco struck at the Crane said Exelon took some ket that’s designed to not only pro- CEO Chris Crane said Feb. 24 on the of selected non-essential mainte- heart of one of Exelon’s consistent steps along those lines after an un- tect the consumers . . . but allow us earnings call with analysts. “We are nance.” e company provided no selling points to investors and pol- usual freeze a few years ago, but to make the investments and oper- detail on what that meant, icymakers—its top-tier operational they weren’t enough. ate our plants safely and reliably,” EXELON ESTIMATED THE EARNINGS but with a power-plant busi- record. e company consistently Unlike the multistate grid that Crane said. ness with its largest presence puts out press releases when its nu- includes northern Illinois, Texas’ Exelon has 3,619 megawatts of HIT TO BE BETWEEN $560 MILLION in Illinois, Exelon e ectively clear plants function through ex- market doesn’t require consumers capacity in Texas—mainly the gas appears to be planning to treme weather events in the North. to pay power generators a “capac- plants but also some wind and solar AND $710 MILLION AFTER TAX. put o projects at its Illinois In fact, it did so Feb. 22 in response ity” charge in return for a pledge facilities. at’s 11 percent of Ex- nuclear plants to compen- to the cold and snow that struck Il- to deliver during days of the year elon’s total U.S. capacity of 31,594 evaluating all options with respect sate for the failure in Texas. linois as part of the same weather when demand is highest. ose megawatts. to our (Texas) business.” “ e implication that Exelon system that pounded Texas. charges, which are embedded in With Exelon now planning to spin e three plants, which together would cut corners at its nuclear fa- “We want to be a reliable provid- the overall cost households and o its power-generation unit from generate more than 3,500 mega- cilities to o set costs incurred as a er,” Crane told analysts. businesses pay for electricity, help its regulated utilities like Common- watts, failed to deliver for signicant result of the Texas storms is absurd,” Crane referred on the earnings cover the cost of girding for ex- wealth Edison, exiting the Texas portions of three days last month. a spokesman said in an email. “Ex- call to metallurgical, pressure and treme weather in other parts of the market would make for a substan- e failure of gas plants across Tex- elon Generation does not cut cor- instrument issues as part of the country, Crane said. tially smaller stand-alone company. Groupon now listing entire HQ for sublease marketing all of the nearly 300,000 Some of that may ultimately But the daily deals square feet Groupon occupies on come o the market as companies a lease that runs through at least return to o ces in greater num- company says it still plans January 2024, making it the largest bers, perhaps as soon as later this to maintain an o ce at block of contiguous space avail- year. But it’s still giving landlords able for sublease in the city, ac- ts as an indication of softening 600 W. Chicago Ave. cording to real estate information demand while vacancy soars to a company CoStar Group. record high. BY DANNY ECKER But Groupon doesn’t plan to en- Especially painful for building tirely abandon its footprint there. owners with large vacancies: Tech Ten months after putting half of “We intend to maintain an of- companies, which drove a lot of its River North headquarters up ce on whichever oor isn’t sub- the record-high leasing demand for sublease, Groupon has now leased,” Groupon spokesman Nick before the pandemic, account for listed the rest of it. Halliwell says in a statement. the lion’s share of the sublease of- e daily deals company last Halliwell doesn’t specify what ferings. In addition to Groupon, week added another 144,000 prompted the new listing for the that crowd includes names like 600 W. Chicago Ave. square feet to its o ering at 600 W. building’s fourth oor. But Grou- Uber, Facebook, Glassdoor and Chicago Ave., adding to the tsu- pon is likely among the many Yelp. about 19 percent of its total work- two years before that—and has its nami of o ce space downtown companies looking to save on real Groupon was hit especially force—as of the end of September. name adorning the outside of the tenants are trying to o oad as estate costs now and betting they hard at the onset of the pandem- at’s less than half the 2,800 jobs building at 600 W. Chicago. Grou- COVID-19 forces them to rethink won’t need as much o ce space ic, which coincided with the exit the company said in April that it pon subleases some of that space their workspace needs. in the future after nearly a year of of former CEO Rich Williams in expected to cut by the end of 2021. to data-analytics software and Groupon generated one of the operating with employees work- March. Interim CEO Aaron Coo- Groupon executives told ana- services company Uptake Tech- rst big headlines in that trend ing from home. As of early last per has tried to stabilize its core lysts in October that the company nologies, which is led by Groupon in late April when it listed nearly month, 5.3 million square feet of business of o ering online deals was on track to save $140 million co-founder Brad Keywell. 150,000 square feet on the third downtown o ce space was on the from local merchants while the from its job cuts and furloughs. CBRE brokers Paul Reaumond oor at its headquarters amid sublease market, almost twice as company has also been in ma- Groupon leases about 375,000 and Todd Lippman are marketing plans for sweeping furloughs and much as there was a year before, jor cost-cutting mode. Groupon square feet through January the 600 W. Chicago space on be- job cuts. Now brokerage CBRE is according to brokerage CBRE. disclosed about 1,200 job cuts— 2026—with a termination option half of Groupon.
P015_CCB_20210301.indd 15 2/26/21 3:38 PM 16 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS Developers plan Fulton Market, Union Park apartments Sterling Bay proposes 320-unit tower around the corner from McDonald’s headquarters, while Marquette plans 210-unit project next to the Ashland Avenue CTA station
BY ALBY GALLUN so many downtown restaurants and bars shut down, and demand Plans for another 530 apart- for apartments fell. ments west of downtown are mov- But recent data suggests that ing forward as the multifamily the market is bottoming out and market begins to pull out of a se- poised for a recovery in 2021. Last vere COVID-induced slump. year, as some tenants moved out In the Fulton Market District, of the Mason, a 263-unit building Chicago developer Sterling Bay Marquette developed on the west wants to build a 320-unit tower end of the Fulton Market neigh- at 160 N. Morgan St., just around borhood, the property’s occu- the corner from the McDonald’s pancy dropped below 90 percent, headquarters. It would be the rst Sloniger says. It’s back above 90 apartment project in the neigh- percent now. borhood for Sterling Bay, one of e building “is starting to lease A rendering of an apartment building Marquette has proposed at 140 N. Ashland Ave. the busiest developers in the area, up like crazy,” he says. “ e last with a focus on o ce buildings week to two weeks, it has really able-housing ordinance, Sterling Designed by Brininstool & Lynch, sense of security to a neighborhood and hotels. picked up.” Bay would set aside 32 apartments the project is west of Ogden Ave- “that just doesn’t feel safe,” Sloni- Farther west, Naperville devel- as a ordable to residents at income nue, the western boundary of the ger says. Marquette would build oper Marquette has proposed 210 A NEW WAVE? levels below the Chicago-area me- Fulton Market District, and a good its Ashland building right next to a units at 140 N. Ashland Ave., on the A recovery could usher in anoth- dian income. It would also invest in 15-to-20-minute walk from the CTA station, a plus for residents. west side of Union Park. It would er wave of apartment construction another 32 a ordable units o -site. trendy neighborhood’s core. But It should also be a bonus for be Marquette’s fth multifamily in the greater downtown after a Sterling Bay aims to “raise the bar residential development is expect- tenants at the Mason, but many of building in the area, part of a con- retrenchment in 2020. With fewer for neighborhood residential and ed to creep west toward the United them now walk the longer distance centrated investment by the devel- projects getting underway over the bring our ‘live-work-play’ vision for Center as land becomes scarce and east to the Morgan Street CTA stop, oper around the 14-acre park. past year, developers will add just the submarket full circle,” according rents rise in Fulton Market. more con dent about their safety “ at’s like the nal piece of the 1,300 apartments to the downtown to a statement from the company. Marquette is investing heavily by taking that route, Sloniger says. puzzle for me,” says Marquette market in 2022, down from 2,800 Farther west, Marquette plans in the area, with 1,042 apartments Both Marquette and Sterling Bay President and Chief Investment this year and the lowest total since its 210-unit project on a proper- completed, under construction or need the Chicago Plan Commission O cer Darren Sloniger. “I think it 2012, according to Integra Realty ty it has agreed to buy from the in planning there. It started with and City Council to approve zoning will be really transformative.” Resources, an appraisal and con- Women’s Treatment Center, a sub- the Mason, at 180 N. Ada St., which changes for their projects. ey also Sterling Bay and Marquette are sulting rm. But that number is stance-abuse clinic. e developer opened in 2019. Last year, it broke need construction nancing. seeking the city’s approval for the likely to jump in 2023 and beyond would keep a ve-story building on ground on two projects, a 278-unit Marquette’s development, which projects after one of the worst years if the economy and market bounce the site and convert it into apart- building at 1400 W. Randolph St. Sloniger estimated would cost for downtown apartment land- back, as many expect. ments, tear down a three-story and a 243-unit development at about $75 million, sits in an oppor- lords in recent memory. Occupan- At 160 N. Morgan, Sterling Bay structure there and construct a 1454 W. Randolph. Marquette also tunity zone, where investors can re- cies and rents in and around the plans a 320-unit apartment tower 12-story building in its place, ac- is converting an o ce building at ceive federal tax breaks for backing central business district plunged designed by Chicago-based bKL Ar- cording to another zoning applica- 1436 W. Randolph into 48 apart- real estate projects. But Marquette in 2020 as many downtown busi- chitecture that would rise 380 feet, tion. Marquette would set aside 21 ments. hasn’t decided if it will seek - nesses required their employees to according to a zoning application of the apartments as a ordable and Union Park o ers a major amen- nancing from an opportunity-zone work remotely. Living close to the led with the Chicago City Council. provide another 21 a ordable units ity for residents, and Marquette’s investor, Sloniger says. He aims to o ce lost its value, especially with To comply with the city’s a ord- o -site. projects will energize and bring a break ground as soon as July. Shopping center landlord InvenTrust names its next CEO Chief Financial O cer Daniel Busch, who takes over the top job in August, will have to gure out a path forward for the company as more consumers shop online
BY ALBY GALLUN amidst a challenging and unprece- in Texas and the Southeast, at the dented environment is a testament end of 2020, according to the com- e longtime top executive of to our strategy and the strength of pany’s annual report. InvenTrust InvenTrust Properties, a big shop- our business model,” Busch says in owns no properties in Illinois. ping center landlord, is retiring, the statement. “I look forward to e pandemic has been espe- relinquishing the job to the com- taking on this new role and work- cially cruel to retail landlords amid pany’s chief nancial o cer, a for- ing with the Board and manage- a wave of store closings and re- mer research analyst who joined ment team to propel InvenTrust tail bankruptcies. Many shoppers InvenTrust in 2019. to further success and drive share- shifted their purchases online, and omas McGuinness, 65, will holder value.” many retailers stopped paying rent. step down in August as CEO of the rough a spokesman, McGuin- Downers Grove-based real estate ness and Busch decline to com- AVOIDING THE WORST Incoming CEO Daniel “DJ” Busch, left, and the retiring Thomas McGuinness investment trust, which has named ment beyond the statement. InvenTrust avoided the worst Daniel “DJ” Busch as his succes- Founded in 2004 as Inland of the storm due to its reliance on stock listing or sale of the company time to transition the CEO role sor, InvenTrust says in a statement. American Real Estate Trust, the grocery stores and other so-called to allow shareholders to cash out. and DJ is the right person to guide Busch assumed the job of president company was once the biggest essential retailers, which have sur- Many investors will surely wonder InvenTrust forward through the on Feb. 22 from McGuinness, who U.S. REIT not listed on a stock ex- vived and, in some cases, thrived if that’s more likely to happen with Company’s next stage of our life also plans to retire from the compa- change. Backed by nearly $8 billion over the past year. e REIT plans Busch in the CEO seat. cycle,” McGuinness says in the ny’s board in May 2022. in equity raised by its sponsor, Oak to increase its dividend in April. Busch joined InvenTrust as ex- statement. “DJ is an enthusiastic McGuinness has led the compa- Brook-based Inland Group, Inland But the company’s value fell 8 ecutive vice president, CFO and and engaging leader with a unique ny since 2012, most recently nav- American at one point owned ho- percent last year, according to an treasurer in September 2019. Prior perspective on our industry.” igating it through a severe down- tels, student housing, o ce build- annual estimate performed by an to that, he was managing director Mike Phillips, senior vice presi- turn in the shopping center market ings and even private prisons. advisory rm, and its share repur- of Green Street Advisors, a Califor- dent and chief accounting o cer due to the coronavirus pandemic. But the REIT, which changed its chase program is suspended. nia research rm that specializes at InvenTrust, will take over as ough the business has stabilized, name to InvenTrust in 2015, has at’s a problem for investors in REIT stocks. He has an under- CFO and treasurer when Busch be- Busch will have to gure out a path sold o big chunks of its portfolio who want to sell their stock. Be- graduate degree from Cornell Uni- comes CEO in August. e Inven- forward in a brick-and-mortar retail and now focuses on shopping cen- cause the company’s shares aren’t versity and an MBA from New York Trust board also named Christy market facing an uncertain future ters anchored by grocery stores. It listed, they can’t sell them on an University. David, the company’s chief invest- as more consumers shop online. owned 65 retail properties total- exchange. InvenTrust executives “With a strong foundation in ment o cer and general counsel, “Our resilience over the last year ing 9.7 million square feet, mainly have discussed the possibility of a place, I believe now is the right as chief operating o cer.
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21cb0074.pdf RunDate 3/1/21 FULL PAGE Color: 4/C 18 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS Abbott’s former, current CEOs took home a combined $40 million last year The hefty payout came in the same year that COVID tests boosted the company’s sales
BY STEPHANIE GOLDBERG tion in 2019, the last full year he served as CEO and chairman. Abbott Laboratories’ former Meanwhile, Robert Ford, and current chief executives who took the reins from White, raked in a combined $40 mil- pocketed a total of $20.5 mil- lion in 2020, as COVID tests lion last year—72 percent more boosted company sales. than he made in 2019 when he Miles White, who stepped was chief operating officer, the down as CEO last March but filing says. stayed on as Abbott’s executive
chairman, received a total of MULTIPLES BLOOMBERG $19.8 million in 2020, according Ford’s total pay is 266 times to the North Chicago medical higher than that of Abbott’s countries, but 2,579 workers The hefty combined pay- was driven largely by diagnos- device maker’s filing with the median employee, which was in Egypt, Indonesia, Israel and out for Abbott’s top executives tic tests that detect current and Securities & Exchange Com- $77,594 in 2020, according to Pakistan were excluded in iden- came in the same year that recent COVID-19 infections, mission. That’s 28 percent less the filing. Abbott has 109,000 tifying the company’s median company sales increased 8 per- which accounted for 11 percent than White’s total compensa- employees in more than 160 employee. cent to $34.6 billion. The uptick of total sales. Hard kombucha is on the rise in Chicago Luna Bay Booch just launched an alcoholic kombucha product at Mariano’s, as the fermented tea trend blazes a trail from the West Coast to the Midwest
BY ALLY MAROTTI scious consumers. It appears the boozy version Hard kombucha is on the up- is following in the footsteps of its swing in Chicago, and the trend is nonalcoholic sibling. ere’s a being driven, in part, by Luna Bay twist to the trend: When kombu- Booch. cha rst took o , some producers e Chicago-based company had trouble keeping the alcohol launched at Mariano’s last month content down. and will soon be on shelves at 28 U.S. sales of hard kombucha of the grocery chain’s locations. increased to more than $57.5 mil- It is the rst alcoholic kombucha lion in the last year, according to Mariano’s has sold. data from research rm Nielsen. Luna Bay also hit shelves at at’s up from almost $10.7 mil- select Illinois Target locations in lion two years ago. January and plans to launch with delivery service GoPu soon. Al- YOUNGER CONSUMERS ready, Luna Bay is sold in Illinois e desire for nonalcoholic at Whole Foods, Fresh yme, kombucha has cooled in the past
Fresh Market, Binny’s Beverage year, as consumers were on the go BAY LUNA Depot, Gar eld’s Beverage and less and gravitated toward the ba- Foxtrot Market. sics, says Duane Stanford, editor consumers, Stanford says. And santo blueberry, lychee lime Melvin says Foxtrot, which just Luna Bay CEO and co-founder and publisher of drinks industry those who aren’t familiar with (which has a lower ABV at 4.5 per- raised $42 million and is eyeing Bridget Connelly sees potential in newsletter Beverage Digest. But kombucha might need some con- cent) and seasonal avor orange an expansion, is bullish on the her hometown market. hard kombucha also taps into the vincing. persimmon. hard kombucha category. In base- “I think Chicago’s going to be hard seltzer craze, which isn’t ex- Mariano’s spokeswoman Still, there’s a seasonality is- line sales, Foxtrot sells more hard the second-largest market for pected to slow down. Amanda Puck says the chain has sue here. Chicago is cold half the kombucha than it does domestic hard kombucha,” she says. “ ere Hard kombucha brands will devoted large refrigerated sec- year—weather that doesn’t exact- beer, he says. e retailer plans to is such an opportunity there, and likely nd a natural market ready tions to Luna Bay and is selling ly invoke cravings for light and increase the number of hard kom- there is such a health conscious and waiting in Chicago, where several avors. fruity drinks. bucha products it sells from eight community there that I don’t “people probably understand “Many of our shoppers en- Luna Bay’s seasonal avors to 15. think is really recognized.” kombucha and know what it’s all joy kombucha,” she says in an have helped with that, says Dylan Luna Bay’s Connelly declines to e kombucha trend started on about,” he says. “ ose are some emailed statement. “(Luna Bay) Melvin, beverage director at retail- comment on the company’s rev- the nonalcoholic side, with the of the younger consumers who is unique and in line with the suc- er Foxtrot Market, which has car- enue but says sales have roughly fermented tea blazing a trail from are really gravitating toward hard cessful hard seltzer category, with ried the company’s products since quadrupled in the last year. e the West Coast to the Midwest seltzer as well.” low ABV and easy to enjoy with fall 2019. company expected to have 10 em- over the past decade. Most kom- Retailers should like selling it, their great avors.” “ ere’s only so much you can ployees by the end of February. It bucha brands promise probiotics too, largely because hard kombu- Luna Bay uses a yerba mate tea do to deter the softness of mid- sells its products in 10 states and to improve gut health and plen- cha is a premium product with base. Its products are gluten-free, winter, but there are ways and one plans to add more this year. ty of bubbly avor. Much of the higher margins, Stanford says. plant-based and low in sugar and of those ways is to be hyper-sea- Chicago is the leading market, ca eine and sugar is burned o e new category also faces have an alcohol by volume of 6 sonal,” he says. “ eir persimmon Connelly says. during the fermentation process, challenges. Premium price points percent. Flavors include ginger smash was a step in the right di- “You’ll see more of us around which also appeals to health-con- might create a ceiling for reaching lemon, hibiscus lavender, palo rection.” Chicago,” she says.
P018_CCB_20210301.indd 18 2/26/21 3:34 PM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 19 Chicago’s Oak Street shopping district remains relatively strong in pandemic OAK STREET from Page 3 at leaves CBRE with only about 10,000 square feet of ground- oor Stone Real Estate. retail space to ll, a manageable “ e demand for space is less than task in the current market. ASB is normal, but it’s not horri c,” says recon guring the base of the build- John Vance, a principal at Stone. ing for multiple tenants and squar- at passes for good news these ing o its rounded entrance at the days. So does the Barneys rede- corner of Rush and Oak. Citibank, velopment, a major undertaking which operates a 5,000-square-foot by ASB Real Estate Investments, bank branch along State Street, is a Bethesda, Md.-based investor the building’s only current tenant. backing the venture that paid $155 ASB declines to discuss the Bar- million in 2013 for the property at neys project or say how much it will 1-15 E. Oak St. cost. e rm recently paid o a $68 e project is both a vote of million mortgage on the building con dence in the Gold Coast and that was set to mature in May. an acknowledgment that the re- “ is mixed-use property is lo- tail business has changed forever. cated on what we consider to be the Rather than seeking a single retailer best corner within Chicago’s Gold to take the entire 95,000-square- Coast and we look forward to an- foot building—a long shot consid- nouncing more details of our plan ering the struggles of department in the coming months,” ASB Senior stores—ASB is chopping up the Vice President Nicolas Franzetti space for multiple tenants. said in a statement. “We have been
ASB’s broker, CBRE, is market- pleased with the strong interest in OSGOOD ZAC ing the upper oors to o ce rather the space we have received to date.” A venture backed by Bethesda, Md.-based ASB Real Estate Investments paid $155 million in 2013 for the property at 1-15 E. Oak St. than retail tenants, recognizing that most retailers today only want rst- VALUATION landlords there have bene ted from e divergence may re ect the threat because their clientele or second- oor space and won’t Yet even if ASB lls up the build- a migration away from Michigan gap between the wealthy and every- won’t buy a $5,000 watch or $1,000 pay much for anything higher. ASB ing, it will have a hard time bring- Avenue, poaching Magni cent Mile one else that has widened since the shawl online. ey want an in-per- is removing a sweeping staircase ing its valuation back up to the retailers like Chanel, Van Cleef & pandemic. e Mag Mile attracts son experience with a high level of rising to the top of the building and $155 million the rm paid for it in Arpels and Anne Fontaine. e Oak more middle-income shoppers, customer service, Vance says. lling in a lot of the “open, dramatic 2013. One reason: O ce tenants Street retail vacancy rate stands at many who are feeling nancially Still, Vance and Kirsch say the space,” that works in a store but not pay a lot less for space than retail- 9.8 percent today, down from 12.4 strapped, and relies heavily on tour- current market can’t support the in an o ce, says CBRE Senior Vice ers do, so the building is unlikely percent in 2019, according to Stone. ism, which has cratered since the rents Oak Street landlords are President Luke Molloy, head of the to generate the $10.3 million in e Mag Mile, on the other hand, coronavirus spread here last year. seeking. Retailers can aord rents brokerage team leasing the retail net operating income it did before already struggling before the pan- Many Michigan Avenue retailers equating to 10 to 20 percent of space. Barneys went out of business. demic, is hurting even more now. also face erce online competition. their sales, but the average asking “It needs a pretty signi cant re- “No matter what, you’re not going Gap recently closed its agship store Many of the rich shoppers who rent on Oak Street, about $350 per working,” he says. It’s “basically a to replace the Barneys’ rent,” says on the boulevard, and Macy’s is frequent Oak Street boutiques, square foot, works out to a higher total gut job.” Greg Kirsch, executive managing di- shutting down its department store meanwhile, have added to their percentage for many. CBRE is courting restaurant op- rector in the Chicago o ce of Cush- at Water Tower Place. wealth as nancial markets have re- “Landlords have just not come o erators for the former Fred’s restau- man & Wake eld. “ ings are looking very good for covered and their investment port- their pre-COVID asking rents, and I rant space on the building’s sixth Oak Street, the core of a Gold Coast Oak Street,” says Joseph Dushey, folios have grown. think they should,” Kirsch says. oor and has received “quite a bit shopping district that includes Rush vice president at Jenel Real Estate, a “ ey survived very well,” Vance It’s not for a lack of trying by retail- of interest” for it already, Molloy and Walton streets, has been a long- New York-based investor that owns says. “ e customer that has been ers, Vance says. says. He expects the o ce space to time destination for retailers that three properties there, including more aected by COVID is the Mag “Tenants are coming in and lease to tenants including boutique cater to upper-crust shoppers, with one leased to Hermes across from Mile customer.” saying, ‘I’ll do a deal, but this is investment rms, family o ces and tenants like Hermes, Harry Winston, Barneys. “I can’t say the same thing Oak Street retailers are also less COVID,’ ” he says. “‘My rents need health care businesses. Prada and Armani. In recent years, for Michigan Avenue.” vulnerable to the e-commerce to re ect that.’ ” More downtown landlords are warming to the idea of co-working space down the most competitive envi- CO-WORKING from Page 3 back into the o ce market pool. out of the pandemic. Skokie-based were before the pandemic: eir Many landlords are preparing ronment in recent memory, says Next Realty recently signed broker- investors—and more importantly, has changed much with the indus- for that by turning to co-working Michael Kloppenburg, a senior age Stream Realty Partners to take lenders—still see co-working space try’s fast-growing players taking it specialists for help. But the mod- consultant in the exible o ce over leasing of an 80,000-square- as a big risk. Many have a hard on the chin. Giants WeWork—one el is changing: Instead of inking practice at brokerage Avison Young foot o ce that co-working brand time understanding the return on of the biggest users of o ce space traditional leases, more landlords who works with landlords on im- Spaces abandoned in January at investment for co-working space in downtown Chicago—and Re- are signing co-working providers plementing shared o ce strategies. 620 N. LaSalle Drive. Stream will that may have highly volatile occu- gus have been shuttering locations as consultants or management “We’re seeing some experimen- install its own exible o ce brand, pancy, a metric they usually rely on nationwide while much of the partners, forging revenue-sharing tation going on” from landlords Rapid, in part of the space. to justify putting new capital into a workforce operates remotely. New deals to manage their exible o ce that resisted co-working before but “ e optionality for a company building, says Mara Hauser, found- York-based co-working rm Kno- space. As opposed to a co-working are now gravitating toward deals that is in ux about its o ce de- er and CEO of suburban shared of- tel, valued at more than $1 billion company paying rent, for example, “whereby they control the space mands (makes) this an ideal solu- ce provider 25N Coworking. in 2019, led for Chapter 11 bank- it would get a fee for managing the but they outsource management tion,” Next Realty President and “ ere are still hurdles there,” ruptcy in January. space and split pro ts from shared expertise to someone that’s got a Chief Operating O cer Marc Blum says Hauser, who estimates her “Jumping into the realm of o ce leases with the property’s history of doing it,” he says. says. “I think this concept is here to work consulting landlords on their co-working is something we didn’t owner—akin to the hotel world, stay. It will supplement your tra- exible workspace strategy has take lightly,” says Lindsay, whose where investors own properties but GUN SHY ditional o ce space, and I believe doubled since the start of the pan- deal with Workbox included more hire major brands like Marriott or Some landlords have a bad taste there will be demand for a very long demic. than 15,000 square feet at 306 W. Hyatt to manage them. in their mouth after their co-work- time.” She foresees investor and lender Erie St. “But the reality is we identi- Workbox will pay some rent but ing operator tenants got crushed by Stream’s brokerage rivals are sentiment on co-working changing ed having co-working in our port- also share some of the pro ts from the pandemic, leaving their build- also diving deeper into co-working over time with so many companies folio as being really advantageous tenants it brings in above a certain ings with heavily divided space that space management to meet land- demanding shorter lease terms af- to respond to the market in almost threshold, Lindsay says, calling it would be expensive to repurpose lords’ needs. CBRE recently paid ter the pandemic. But it remains a any way possible.” “the symbiotic relationship that we into something other than shared $200 million for a 35 percent stake tough sell for now. Rising vacancy and the foggy fu- were looking for.” o ces. More than 10 percent of in Industrious and will integrate “ ey’re going to a lender saying ture of o ce demand are pushing It’s not a new formula—New the roughly 5,800 pre-pandemic its own co-working brand into the ‘we want $130 to $150 per (square) landlords to embrace shared work- York-based Industrious, which re- co-working locations nationwide company’s operations. Regus par- foot to build out the space, but we space providers in ways they were cently signed on to manage a full have gone dark from issues like ent IWG also bought a majority have no idea how we’re going to reluctant to do before, industry ex- oor of co-working space at Willis lease defaults or bankruptcies, ac- stake in the Wing, a female-focused get that money back,’ ” Hauser says. perts say. With companies lost on Tower, has signed such manage- cording to an estimate from Chi- shared o ce provider. Real estate “It’s an amenity space . . . so you’re how much o ce space they’ll need ment agreements for several years cago-based shared o ce provider rm Newmark is acquiring Knotel’s talking to lenders about value and in a post-pandemic world, demand and is trying to convert its legacy Novel Coworking. assets. revenue generation that will occur for workspace that can be leased on leases into landlord partnerships. But even those whose co-working Yet some landlords are still hes- from an amenity space. In the past, exible, short-term deals is expect- But it’s now becoming a more tenants collapsed recognize tenants itant to add co-working to their amenity spaces didn’t bring in rev- ed to soar as tenants dip their toes popular strategy as landlords stare will crave lease exibility coming buildings for the same reason they enue.”
P019_CCB_20210301.indd 19 2/26/21 5:36 PM 20 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS
æ`ÛiÀÌÃ}-iVÌ w PANDEMIC INTERFERENCE AT MOTOROLA Motorola Solutions’ overall revenue declined last year because of the company’s heavy reliance on two-way radios. But video is its CLASSIFIEDS fastest-growing line of business. To place your listing, contact Claudia Hippel at 312-659-0076 TOTAL REVENUE REVENUE SHARE, 2020 REVENUE BREAKDOWN or email [email protected] www.chicagobusiness.com/classi eds $7.41 billion $487 million $927 million 2018 2019 2020 . $8.0 million Software Video $7.0 million $6.0 billion 7.0 6.0 APARTMENT BUILDINGS WANTED LAW 6.0 5.0 Private Investors seeking to acquire larger QUESTIONS? We got ANSWERS! 5.0 buildings of 50 to 200 units or more on the 4.0 North side or N or NW suburbs only. HALE & MONICO 4.0 We are not brokers. Reply confi dentially to 3.0 [email protected]. (312) 500-2951 3.0 HaleMonico.com 2.0 2.0 $927 million $487 million Injury Attorneys 1.0 1.0 BUSINESS FOR SALE 0 0 2017 2018 2019 2020 $6.0 billion Radio Software Radio Video OWN A SUCCESSFUL OPERATING LEGAL SERVICES Car Wash, Detail Shop & Parking Facility Source: Company filings in Wilmette Illinois. Great location & customer base. Motivated seller! DADS’ RIGHTS! EMAIL: John at [email protected] 8000 Why CEO expects a big rebound at Motorola 7000 BUSINESS FOR SALE MOTOROLA from Page 3 6000 Follow Our Victories ! SOCIAL SERVICES AGENCY FOR SALE on March 4, 2020. 5000 Local and state contracts in IL and IN. e economic fallout from the 20 years in business. Great reputation. 4000 100K monthly revenues, a great opportunity LOANS pandemic highlights the impor- for expansion. CALL 877 267 7477 MULTIFAMILY REAL ESTATE LOANS tance of Brown’s aggressive moves 3000 $500,000 to $5,000,000 into video and software, which Great Rates and E cient Closing Times generated $1.4 billion, or 20 per- 2000 DEVON BANK cent of total revenue last year. It CAREER OPPORTUNITIES CALL 7734232527 also underscores Motorola’s con- 1000 ENOVA FINANCIAL HOLDINGS, LLC CHICAGO • ORLAND PARK • BRIDGEVIEW tinued reliance on radio equip- 0 seeks SR. SOFTWARE TEST ENGINEER II MEMBER FDIC. EQUAL HOUSING LENDER. ment for the remaining 80 percent. in Chicago, IL to design test plans, scenarios, “Investors want to be more scripts, or procedures. Apply at https://www.jobpostingtoday.com/ RETAIL SPACE FOR RENT comfortable that government REF# 59967. spending for (radio) networks is Downtown Chicago Loop storefront recovering,” says Louie DiPalma, on ground fl oor at 22 E. Adams an analyst at William Blair. “While btwn State & Wabash, 1500 SF, clean/ready space cloud software and video are ex- CAREER OPPORTUNITIES ½ block to Adam L, 1 ½ block to Art Instit./Mlnl. Pk 773 354 3940 Brad citing growth opportunities for SENIOR EMERGENCY RESPONSE ENGINEER Motorola, (radio equipment) rep- position available with GHD SERVICES, INC. resents 80 percent of revenue and located in Rosemont, IL. Position will be is the biggest needle mover.” responsible for leading and expanding GHD’s With an estimated 70 percent of Motorola Solutions now is selling its own body cameras for police, and it hopes new radios that have emergency spill response services in Chicago AUCTIONS and surrounding areas, and maintain project advertising opportunities available the U.S. market for two-way radi- smartphone features and cellular and Wi-Fi capabilities will help perk up sales. schedule, budgets and coordination of os, Motorola dominates the busi- project sta . Travel required up to 75%. To advertise contact ness. It grows slowly, about 2 to 3 projects which can result in grow- maker of Tasers. But the market is Send Resume to Patrick Burnside at Claudia Hippel percent annually in normal times, ing deferred maintenance.” too big to pass up at $500 million, [email protected] Referencing [email protected] estimates analyst Keith Housum at e White House has proposed including evidence-management “SENIOR EMERGENCY RESPONSE Northcoast Research in Cleveland. $350 billion in additional funding software, Brown told analysts. “I ENGINEER ROSEMONT, IL”. EOE. 312-659-0076 Motorola expects radio sales will for state and local governments in think we have a great opportunity increase by mid-single digits this its latest pandemic-relief package, to take share and be a competitive, year, while its video-related busi- which would help alleviate budget compelling number two,” he said. ness grows in the high teens. Sales pressure. Jack Molloy, Motorola’s exec- of command center software, Motorola maintains that public utive vice president for products OUR READERS ARE which ties together an increas- safety equipment is “need-to-have and sales, says orders for body 125% MORE LIKELY ingly complex array of products technology” that is less vulnerable cameras increased more than 60 TO INFLUENCE for police and re departments, to budget cuts than other types of percent in each of the past two are expected to rise more than 20 spending. quarters. Total revenue from video OFFICE SPACE percent. Motorola’s sales of two-way radi- products and services grew 31 per- DECISIONS os to corporate customers, which cent last year as radio sales fell o MARGINS fell $300 million, or about one- 11 percent. Motorola’s software and ser- third, last year, are more vulnera- Motorola has built its video vices carry a pro t margin of about ble. “Airlines, hospitality and utili- and software businesses large- 25 percent, compared with about ties are still hurting,” Housum says. ly through acquisition. Overall, 16.5 percent for its hardware. e company hopes a new radio Brown did ve deals last year for e radio business is on the that also has smartphone mend, Brown told analysts. Ra- features and cellular and dio orders soared to record levels Wi-Fi capabilities will “INVESTORS WANT TO BE MORE in North America in the fourth help perk up sales. quarter, including a $122 million Motorola is pushing COMFORTABLE THAT GOVERNMENT contract with Nassau County, New hard into video cameras SPENDING FOR RADIO NETWORKS York. for schools, businesses “I think there has been pent-up and other customers, IS RECOVERING.” demand,” Brown told a questioner. which grew more than But the economic recovery from 45 percent last year. e Louie DiPalma, analyst, William Blair COVID-19 has been uneven and company also is selling Find your next slow for many Motorola custom- its own body cameras for police, $282 million. Analysts expect more. corporate tenant or leaser. ers. S&P Global Ratings warns that thanks to the 2019 acquisition of “I could see them making an “with a winter COVID spike and a WatchGuard for $271 million. international software acquisition slower economy going into 2021, it Starting this year, Motorola also or video-surveillance acquisition,” will likely take local governments o ers the capability to manage ev- Housum says. longer to recover to pre-recession idence, including video footage, Brown says he’ll balance inter- revenue levels. A slower pace will as part of its command-center nal R&D with M&A. “We continue translate into slower revenue re- software product for emergency to scan acquisition opportunities. Connect with Claudia Hippel at covery for many, resulting in more dispatch centers. ey’ll probably be more around [email protected] for more information. cuts to restore budgetary balance. Body cameras are dominated by video security, software and ser- is includes delaying capital Axon, the Scottsdale, Ariz.-based vices.”
P020_CCB_20210301.indd 20 2/26/21 4:54 PM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 21 Some of your favorite dining spots haven’t made it. Others have changed.
RESTAURANTS from Page 1 be more spaced out, and some business groups might be ushered Downtown into private dining areas. A handful of decades-old steak- restaurant houses, including Lawry’s the Prime Rib, Ruth’s Chris Steak House and Morton’s original State scorecard Street location, closed permanent- Here's where some business ly. favorites stand: Happy hour spots like the Bea- con Tavern behind the Wrigley Beacon Tavern—Permanently closed. Building are gone. Other restau- Bellemore—Closed until further rants—particularly some in the notice. Loop that also catered to the the- ater crowd, like Petterino’s—shut Coco Pazzo—Open. down and have not announced Cooper’s Hawk Esquire Chicago— reopening plans. For many restau- Takeout and delivery only. rants that have closed temporarily, it remains unclear whether the clo- Free Rein—Permanently closed. sure will become permanent. Frontera Grill—Open for lunch and New sanitation protocols are dinner. expected to stick around. Some The Gage—Open. restaurants conduct temperature checks at the door or have desig- GT Fish & Oyster—Open for dinner. No nated employees for disinfecting date set for lunch return. surfaces. It is habit at this point, Gene & Georgetti—Open for lunch operators say, and masks are part and dinner.
of the uniform. DEARBORN THE Italian Village Restaurants—Only ere’s also a newfound ex- The Dearborn in the Loop, below, is planning a March reopening with a revamped menu. It is owned by sisters Clodagh Lawless, left, and Amy Lawless. the Village is open. No reopening dates ibility at restaurants, especially set for Vivere or La Cantina. when it comes to customers who are wining and dining clients, says Lawry’s—Permanently closed. Kim Giguere-Lapine, chief market- Monteverde—Open for carryout and ing o cer of Smith & Wollensky delivery. Restaurant Group. Previously, if a customer wanted Morton’s on State Street—Perma- to book a room at Smith & Wollen- nently closed. sky, they would have had to put Ocean Prime—Open for dinner. down “a sizable” nonrefundable Paci c Standard Time—Permanently deposit, Giguere-Lapine says. at closed. is no longer the case. “Quite simply, the demand is Petterino’s—Closed; has not an- not as high, so we can be a little bit nounced reopening plans. more exible,” she says. “Just like Purple Pig—Open for lunch and the airlines. If you need to change dinner. a ight because of a COVID issue, Topolobampo—Open. they let you change it.” Smith & Wollensky started of- Volare—Open for dinner. fering space for professionals to conduct remote meetings last fall, before indoor dining ceased. ose o erings are still available, day. By mid-March, he expects that that Bazzi says better optimizes in- Giguere-Lapine says. to increase to 100,000 doses a day. gredients. e fried calamari and “ e corporate world’s going grilled octopus that show up on the MEETINGS to come back,” says David Flom, antipasto menu could also be used A few blocks away, Kinzie Chop- managing partner at Chicago Cut. in a seafood pasta. e breaded house is also o ering its private “It’s just going to take a little time.” eggplant atop a salad can also go event rooms for business meetings, Chicago Cut closed before in a sandwich served at Nonnina’s says owner Nicole Flevaris. ere’s Christmas and doesn’t plan to re- sub shop next door. even a second entrance those cus- open until April. at has given the But business diners will also no- tomers can use. riverfront steakhouse time to tinker tice menus aren’t quite as skimpy “In the bigger private rooms, we with menus. as they were when restaurants were can socially distance and everyone Flom says they are sourcing dif- slashing costs last summer, with no feels safe,” Flevaris says. ferent sh for new menu items, like end to the pandemic in sight. An added perk is the privacy, she fresh Florida grouper, branzino Back then, the Dearborn in the says. With fewer people allowed in caught o the coast of Greece and Loop was down about 75 percent the restaurant, dining rooms are lobster tail from an island between in sales, says Clodagh Lawless, who
quieter, and eavesdropping easier. South America and Africa. Vegeta- NONNINA owns the restaurant with her sister, “If I’m having a private conver- bles will be paired together, instead Joe Bazzi, general manager of Nonnina, says a new menu better optimizes ingredients. Amy. e chef had to peel o high- sation, I don’t want people to be in of serving just broccoli or just as- cost dishes, and eventually the earshot,” she says. paragus. e slow winter gave chefs at for another reason: cost-e ciency. menu “was just a shell of its prior Still, downtown restaurant oper- “If you leave restaurateurs at Gibsons Bar & Steakhouse on Rush Restaurants have struggled self,” she says. ators say few business diners have home, they get bored,” he says. Street and its sister restaurant, Hu- to pay rent, bills and payroll for e Dearborn shut down in returned. People are still working “We all cook every day. We all think go’s Frog Bar & Fish House, time to months, and limited capacity isn’t early November and is planning a from home as the vaccine rollout about, ‘What would this taste like? adjust their recipes, too, says John enough to get many out of hot wa- March reopening. e new menu gains speed, and that continues What would that taste like?’ ” Colletti, managing partner at Gib- ter. will still have some of its customer to be a detriment to places that e wine and cocktail menus sons Restaurant Group. In a pre-pandemic world, many favorites, like sh and chips and thrived o business lunches, con- are also changing, Flom says. Ex- restaurants would not hesitate to the burger, but also feature new vention tra c and corporate credit ecutives tasted 300 wines last week TWEAKS spend hundreds of dollars on an items, like pizza and cont rabbit cards. as they revamp their wine-by-the It’s in the basics, like house- ingredient, says Joe Bazzi, gener- poutine. e state has given no indication glass program. Flom tried a blue- baked hamburger buns and made- al manager of Nonnina in River e upcoming changes, and of when Chicago’s convention busi- berry vodka recently that he plans from-scratch sauces, where the North. “Now you scrutinize every trickling of customers back into the ness might return. Gov. J.B. Pritzker to pair with lemonade in a new tweaks will be noticeable. e $30 you spend because that’s the Loop, have her feeling hopeful. said Feb. 24 that 1 in 7 Illinoisans summer cocktail o ering. chefs corrected recipe changes that di erence between paying rent “We can see light at the end of had received their rst vaccine e decade-old restaurant also had happened over time, he says. and not paying rent.” the tunnel,” Lawless says. “It’s dim, dose, and the state has the capacity remodeled the wood oors, kitch- Other hot spots for business pro- e restaurant recently got a new but it’s there, and that’s what we’re to administer about 60,000 doses a en and private dining rooms. fessionals streamlined their menus chef and rolled out a new menu going toward.”
P021_CCB_20210301.indd 21 2/26/21 4:29 PM 22 MARCH 1, 2021 • CRAIN’S CHICAGO BUSINESS How credit card giant Discover Financial is getting squeezed on two fronts DISCOVER from Page 1 cheaper and easier to under- vacations, that middle-class con- ever,” Greene said. But “we hav- w REVERSAL OF FORTUNE stand—and available with the sumers often nance with their en’t seen any impacts . . . in terms traction with merchants selling click of their mouse right on the credit cards largely haven’t been of our card balances and person- Discover’s credit card loan balances appliances, exercise equipment, merchant’s website. happening. at leaves mainly al-loan balances.” were growing smartly until the electronics and other high-end Discover’s card loans as of Jan. products, which consumers in- Discover is considering whether pandemic hit and consumers reacted products. Consumers in their 20s 31 were down 9 percent from the creasingly have other options to to o er the product as an option by paying down debt. and 30s, in particular, are gravi- same time a year earlier, to $69.3 nance. itself. Likewise, Capital One CEO tating toward “buy now/pay lat- billion, according to a Securities For Discover, the timing is bad. Richard Fairbank told analysts on CREDIT CARD LOAN BALANCES er” arrangements made available & Exchange Commission ling. e company invented the cash- Jan. 26, “What’s striking here is the $80.0 billion $69.3 billion when they buy online. ese ser- Card loans had been on a steady back credit card in the 1980s, but it way . . . it’s got shelf space right vices allow consumers to pay for rise for years until the beginning of decided several years ago that the there on the (e-commerce) check- 70.0 products via a set fee each month, last year. Even before the pandem- rewards rivals were o ering to en- out page—some of the elegance of 60.0 and in some cases to do so without ic, in the rst two months of 2020, tice big-spending consumers who the digital technology, and inter- 50.0 paying interest. loan levels were falling; COVID ac- routinely pay their monthly bal- estingly nancially how this mar- San Francisco-based A rm, the celerated the deterioration. ances were too rich. It focused in- ketplace works, because the strik- 40.0 ntech launched by University Discover executives are pro- stead on white-collar consumers ing thing to me is that right now 30.0 of Illinois at Urbana-Champaign jecting loans will grow “modest- with good credit who borrowed on merchants are actually paying the 20.0 graduate and PayPal co-founder ly” this year. But in a Feb. 25 Q&A their cards. bill as opposed to consumers.” Max Levchin, has led the way, but with analyst Moshe Orenbuch of With unemployment low in the Capital One also is looking at 10.0 it has plenty of imitators. Since Credit Suisse, Chief Financial Of- lead-up to COVID, that was a good how to get in the game. 0 A rm’s highly anticipated ini- cer John Greene acknowledged strategy. Net income grew from 2017 2018 2019 2020 2021 As of Jan. 31 for each year tial public o ering Jan. 13, shares growth isn’t likely until the second $2 billion in 2017 to $2.7 billion in TECH SUPPORT Source: SEC filings have nearly doubled, reinforcing half of the year. 2018 and $2.9 billion in 2019. In Plenty of ntech rms want to Wall Street’s belief that growth in “ ere’s tons of (consumer) li- 2020, it fell to $1.1 billion, largely help, including Amount, the Chi- buy now/pay later will continue to quidity,” he said. “ ere is another due to heavy reserves Discover cago-based spino from online chants will form their alliances soar. round of stimulus that’s likely go- set aside for potential loan losses, consumer lender Avant. Amount with providers, as Peloton already Since Discover reported fourth- ing to happen.” which mostly didn’t occur. is in discussions with several has done to some notoriety with quarter earnings on Jan. 20, its Discover isn’t alone in its loan- banks about serving as the tech- A rm. stock has fallen more than 5 per- SAVINGS growth woes. Capital One, which nology behind buy now/pay lat- Greene was asked on the Feb. cent in contrast to direct competi- Consumer lenders like Dis- traditionally is willing to lend to er programs, CEO Adam Hughes 25 call what Discover has learned tors like Capital One Financial and cover have noted throughout the consumers with credit scores be- says in an interview. over the course of the pandemic. Chase, which have gained in that pandemic that many customers low Discover’s, saw its card bal- “I think every single major One of the two things he men- time. are socking stimulus away in sav- ances drop 18 percent year over credit card company will have tioned was that decision-making e trend eats away directly at ings or using it to pay down debt. year as of Jan. 31. a buy now/pay later product to in the fast-evolving consumer Discover’s business model. Con- In Discover’s case, loan payment Both card companies are won- o er their merchants within six lending industry can be—and sumers who before would have rates were 0.5 percent higher than dering what to do about the buy months,” he predicts. needs to be—sped up. borrowed on their cards to nance it projected for January, Greene now/pay later phenomenon. So For Discover and the rest, the “You may think things are pre- refrigerator or Peloton purchases said. far, “We’ve been watching it, and issue may end up being not if, but dictable,” he said, “but they’re now have an option that’s often e kinds of experiences, like we’re not dismissive of it whatso- when. Speed is important. Mer- not.”
2021
WOMEN IN CONSTRUCTION AND DESIGN
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Nomination deadline is Friday, Mar. 12. Section publishes May 3. To view Crain’s Notable Executives nomination programs, visit chicagobusiness.com/notablenoms.
P022_CCB_20210301.indd 22 2/26/21 4:24 PM CRAIN’S CHICAGO BUSINESS • MARCH 1, 2021 23 This fast-selling midcentury has an indoor pool A woman who sang opera professionally and ran the Flash Cab company after her husband died in 1988 had owned the home in Niles’ Bunker Hill neighborhood since 1966. It sold in seven days. BY DENNIS RODKIN cause of COVID,” Blaskovits says. e buyers are not yet identi ed in public records, and A modern split-level with an indoor Blaskovits declines to name them. pool, in one family’s hands for more than e street-facing side of the house looks half a century, is the latest midcentury like a typical split-level, only bigger and home in the area to sell fast. with more windows. In fact it’s U-shaped, e six-bedroom, 5,000-square-foot with two sides for living and the third house on Concord Lane in Niles was on housing the swimming pool wing. Inte- the market at $779,000 for just seven days rior nishes include walnut paneling, a in December before going under contract oating staircase and a wall of shutters to the eventual buyer. e sale that open to connect the kitch- closed Feb. 22 at $681,500. HOMES IN en and family room—all de ri-
e house, which has its orig- gueur for the midcentury style. PHOTOS STUDIOS VHT inal slate oors, eldstone re- NILES SOLD IN Built in 1966, it was designed place, wood-paneled walls and by architect Lloyd Churchman period sky blue-bathroom x- AN AVERAGE OF for Kay and Arthur Dickholtz. tures, is in Bunker Hill, a neigh- 77 DAYS ON In 1945, Arthur Dickholtz borhood of about eight square founded what would become blocks with forest preserve on THE MARKET Flash Cab to employ World three sides and several archi- War II veterans like himself. tecturally distinct midcentury IN 2020. After he died in 1988, Kay homes. Dickholtz ran the 250-car rm. Homes in Niles sold in an average of 77 As a female executive in a mostly male days on the market in 2020, according to business, she earned headlines like “Fare Midwest Real Estate Data and the Chicago Maiden.” Association of Realtors, and even faster, 54 “Kay was a pioneering woman in busi- days, in January 2021. Midcentury houses ness,” says Cam Benson, an @properties have regularly sold faster than the norm agent and friend of Kay Dickholtz who in their locales, prompting Crain’s to call represented the home. Kay Dickholtz died midcentury the hottest housing style of in July at age 95. According to her obitu- 2020. ary, she sang opera professionally in her While the Concord Lane house’s buyers younger years. weren’t speci cally searching for mid- In the house’s rst few days on the century, they were instantly taken with market, “we had three showings a day,” this one’s “open living concept and lots of Benson says, “and we got multiple o ers. big windows,” which are hallmarks of the ere were so many people who wanted style, says their agent, Greg Blaskovits of this house.” MCF Realty Group. Blaskovits says his clients will do some Large windows bringing in abundant day- updating, but “it’s mostly cosmetic, not light and a pool are particularly appealing the big things” like utilities and roof, which “when everyone is at home stuck inside be- were all in good condition, he says.
MORE PHOTOS ONLINE: ChicagoBusiness.com/residential-real-estate
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