2 Rush St. clubs — Jilly’s, Back Room — face last call
BY DAVID ROEDER email@example.com September 4, 2012 6:12PM
Jilly's and The Back Room are located at 1007 N. Rush Street in Chicago. Tuesday, September 4, 2012. | Tom Cruze~Sun-Times
Updated: October 6, 2012 1:56PM
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 whether either club would 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.
Fred Lev, a broker of retail space, said Rush Street is seeing a spillover as boutique operators look beyond Oak and Walton streets. Lev said Sergio can probably charge at least $250 per square foot in rent to a retailer, vs. a nightclub lease that might be only $50 a square foot.
“Although there is vacancy along Oak Street, there is not enough space to absorb the upscale retail that is coming to Chicago in droves,” Lev said.
Reilly and the nightclubs could not be reached Tuesday.
LINCOLN PARK IRONY: When Ald. Michele Smith (43rd) came out against a redevelopment plan for the former Children’s Memorial Hospital property in Lincoln Park, she was responding to strong opposition to the plan from the Mid-North Association, a community group. One person helping Mid-North evaluate the project is none other than the architect of the tallest building in the community, Lucien Lagrange.
Now with HKS Architects, Lagrange acknowledged that it was odd to be on the neighborhood side of a developer dispute. But he sees no contradiction in having designed a 39-story building near the lake and opposing a developer’s plan at the Children’s site on the basis of points such as height and density.
Developer McCaffery Interests Inc. came up with a “superblock” scheme that doesn’t do the site justice, Lagrange said. “Retail on two levels never works in Chicago. He’s got 20-story glass boxes. The density and the FAR [floor area ratio] are too high,” Lagrange said.
McCaffery, Lagrange said, is building too many apartments for a rental market that’s liable to fall hard soon. “There’s been overbuilding. It’s the story of Chicago,” Lagrange said.
He’s a River North resident, but he’s helping the Mid-North group because he lived in Lincoln Park for years. His many projects here include the 39-story building at 2520 N. Lakeview that went up despite criticism that it was too tall for the already crowded area.
KENWOOD REHAB: Tricap Chicago, which buys and fixes up apartment buildings, spent $1.29 million on a 31-unit apartment building at 4740 S. Greenwood, an unusually large multifamily site in a neighborhood of historic single-family homes. With a $2.4 million loan from Community Investment Corp., Tricap plans a gut rehab of the courtyard building. Property records indicate the seller was a group that includes investor Alex Samoylovich, mentioned in this space three weeks ago for investments on the North Side.
SPEC SPUNK: Clarius Partners will break ground Sept. 13 on a massive project being built on speculation, or without committed tenants. It’s a million-square-foot industrial building at 3851 Youngs Road, Joliet, near the I-55 and I-80 interchange. The building will start what is planned as a 2.8-million-square-foot industrial park. Clarius hopes the site will attract shippers who want access to the highways and to railroad intermodal terminals.
DOING THE DEALS: CBRE Global Investors bought the 12-story One O’Hare Centre office building, 6250 N. River Road, Rosemont, for a reported $67 million. A German investment fund sold it. . . . Lincoln Property Co. and the investment fund Pimco bought the 230 W. Monroe building for $91.25 million. The seller was General Electric Pension Trust. It contains 623,000 square feet. Lincoln Senior Vice President John Grissim said 100,000 square feet of full-floor space will be available in the coming year. Holliday Fenoglio Fowler LP brokered the deal for the seller.
David Roeder reports on real estate at 6:22 p.m. Thursdays on WBBM-AM (780) and WBBM-FM (105.9). The reports are repeated at 10:22 p.m. Thursday and 7:22 a.m. Sunday.