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Rahm Emanuel brokers deal for Lincoln Park Hospital project

The old Lincoln Park Hospital site. | Jean Lachat~Sun-Times

The old Lincoln Park Hospital site. | Jean Lachat~Sun-Times

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David Roeder reports on real estate at 6:22 p.m. Thursdays on Newsradio 780 and 105.9 FM WBBM. The reports are repeated at 10:22 p.m. Thursday and 7:22 a.m. Sunday.

Updated: November 16, 2011 1:21AM

With mediation and arm-twisting from Mayor Rahm Emanuel, the longest-running fight over neighborhood development currently raging in Chicago has been settled.

Sandz Development Co. is getting the right to build at the old Lincoln Park Hospital at Lincoln and Webster. It has agreed to alter its plans for the three-acre site, changing the way a planned grocery gets its deliveries.

The scale of the project takes a slight trim, and it becomes less commercial and more residential in character. A six-story office building along Geneva Terrace would instead get up to 75 apartments on its four uppermost floors.

Finally, a proposed 40-home development along Grant Place would be limited to eight row houses.

Emanuel relayed outlines of the deal in an interview Tuesday. The main points were confirmed by Ald. Michele Smith (43rd), who was elected on a pledge to change the development so it would meet neighbors’ objections.

The mayor said he intervened in the dispute to achieve an “honest compromise” that results in a better project. The hospital is gone and reviving the property “is a good use for the city. It creates jobs and tax revenue.”

The neighborhood, meanwhile, can be assured that “its voice was heard in the process,” Emanuel said.

He used to serve Lincoln Park as its congressman, and knows how the mostly wealthy neighborhood can mobilize on issues that stir its passions. Lincoln Park Hospital became the central issue in last spring’s aldermanic campaign. Smith can trace her narrow victory directly to the strong support she received from precincts containing the project’s most vocal critics.

“Alderman Smith is a tenacious negotiator,” Emanuel said. He said his administration achieved terms with Sandz that let the alderman keep her pledges to local groups.

Smith, in a separate interview, thanked Emanuel for “support and mediation.” She said the overarching controversy always was about possible overcommercialization of the property, which borders an enclave of wealthy homes. The switch from offices to residential space in one building addresses the issue, she said.

Attorney Martin Oberman, representing groups that oppose the project, agreed that the terms the mayor outlined are acceptable, but he withheld a blessing. “There have been a lot of discussions. It has to be reduced to writing,” he said. Oberman complained that Sandz hasn’t always lived up to oral promises.

Sandz, whose principals are Richard Zisook and Michael Supera, could not be reached for comment.

The design of the grocery, a 20,000-square-foot Fresh Market, is getting an important change. Large delivery trucks would unload from Lincoln Avenue and would not have to drive to docks accessible from Webster, a residential street, as was called for in the existing plan. Smaller delivery trucks would still use the Webster access.

The new agreement would limit the number of deliveries and the hours the store could receive them.

Despite local outcry over the project, the previous 43rd Ward alderman, Vi Daley, endorsed a zoning deal for it and saw the City Council approve it in May, before the new council and mayor were seated.

Oberman challenged the city’s basis for the zoning change in a lawsuit and Smith started the process of changing the zoning again.

The revised deal would require a new hearing before the Chicago Plan Commission and final action by the City Council, Emanuel said.

Over the last two years, the fight became angry and personal, with each side hiring lawyers and outside consultants. But it all could be just a prelude to a battle shaping up over a parcel twice as large and a couple blocks north, Children’s Memorial Hospital at Lincoln and Fullerton.

Children’s is moving and has picked a developer who’s aiming to make its highly visible property a “town center.”

“I’m not saying anything about Children’s today,” Emanuel said. It’s a controversy for another time.

OUTLET PASS: Chicago-based Urban Retail Properties LLC, which in a previous incarnation developed Water Tower Place, has teamed with partners to build Spring Creek Outlets of Chicago in New Lenox. It will be on 97 acres at I-355 and Route 6.

It’ll have 550,000 square feet for retailers. But the hope is it will anchor a broader complex that includes hotels, restaurants and a senior living center.

Center Creek Development LLC and Mansur & Co. are involved in the deal. The developers promise, despite the difficult economy, to open the outlet mall by mid-2013.

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