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Project would close Rush Street night spots Jilly’s, Back Room

Updated: September 5, 2012 8:15PM

Two longtime music venues on Rush Street, Jilly’s and the Back Room, would close under a development proposal that requires review from the city.

Both nightclubs are in a three-story building at 1007 N. Rush. The building’s owner, Realtor and investor Grace Sergio, has proposed razing the building, which also has four apartments, and replacing it with a two-story structure with a single retail or commercial tenant.

A source said Jilly’s plans to close in late September.

The Rush Street district’s alderman, Brendan Reilly (42nd), issued details of the proposal in an email to constituents.

Sergio is married to James Banks, a prominent zoning lawyer who owns a stake in the steak and seafood restaurant Tavern on Rush, 1031 N. Rush.

Her proposal requires a review by the Chicago Plan Commission under the city’s Lakefront Protection Ordinance.

Sergio’s attorney, Nick Ftikas, said both clubs were aware of the possible displacement and have operated on short-term leases for some time. He said he did not know if either club will reopen elsewhere.

Ftikas said Sergio believes a new retail building is “the highest and best use of the property” and should attract support from the neighborhood. “She’s negotiating with an international clothing company” to use the space, and that use is less intense than two nightclubs that operate on late hours, he said.

“A lot of people in the area will look on this as an improvement,” Ftikas said.

Reilly and the nightclubs could not be reached immediately.

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