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Dixie Square ruins remain untouched


David Roeder reports on real estate 6:22 p.m. Thursdays on WBBM-AM (780). The reports are repeated at 10:22 p.m. Thursday and 7:22 a.m. Sunday.

Updated: September 15, 2011 12:28AM

In late September of last year, with less than six weeks to go before the election, Gov. Pat Quinn stood in Harvey near the old Dixie Square mall and promised $4 million to pay for its demolition. Officials at that announcement said they hoped the job could be finished in about eight months.

They apparently didn’t set their clocks to government time, in which everything takes longer and costs more.

The wreckage of the old mall — it’s not even recognizable as such anymore — is still there, a survivor of development schemes long past. The promised $4 million is available, but spending it is another matter.

So the parcel southeast of 151st and Dixie Highway sits, as it has sat since 1978, when the onetime 64-store mall closed. A year later, “The Blues Brothers” film used Dixie Square in a celebrated car chase scene, but since then it’s been of interest mostly to scavengers, fugitives, urban archeologists and wild dogs.

It’s probably the most dangerous commercial ruin in the Chicago area, a macabre centerpiece for a south suburb defined by blight. With the money available, why can’t it be gotten rid of? Bureaucracy is one answer.

The state appointed the South Suburban Mayors & Managers Association as manager of the grant. It could have assigned the task to Harvey, known for official corruption and cronyism. Even the state is more careful than that.

Ed Paesel, executive director of the association, said it has had to abide by state and federal rules, as Illinois was passing through money from federal flood relief. That means hiring a consultant that will write bid guidelines for the demolition, issuing the bids and providing a time for response, and then picking one.

The association has hired Terracon, a firm with a national profile as consulting engineers. Paesel said he hopes contracts can be awarded in August, work can begin in September and that the job will be done by March. “Nobody is more anxious than us to have this project go to completion, but by taking federal and state dollars, we have to follow their rules,” he said.

Terracon, however, will in part be redoing another firm’s work. The property owners last year had a consulting firm, Land Resource Management Group of suburban Crete, draw up plans for demolition and asbestos remediation at Dixie Square. The company wanted a contract with Paesel’s group but was turned down.

Paul Vicari, president of Land Resource Management, said his company had permission from state environmental officials on an asbestos removal plan that would save money. He said he’s concerned Terracon will build in higher costs for asbestos and that bids will be more expensive.

“We could have had this bid out by now. There was really no need to reinvent the wheel here,” Vicari said. He declined to speculate on why Paesel’s group chose another firm.

Paesel said an impartial panel reviewed the proposals and that Terracon was rated best on all counts. “If there’s any way we can expedite this and meet the requirements, we will,” he said.

The owners of Dixie Square include Joseph Edward Miles, president of Main Street Capital Inc. in Glenview, and south suburban industrialist Michael Goich. Their attorney, William Seith, said the delay is unfortunate but that they remain committed to a redevelopment. They’ve cleared up about $3 million in liens on the 39-acre site.

But Dixie Square demands deep pockets. Nobody wants to talk about what happens if the demolition bids come in much higher than the state’s $4 million.

But here’s a reasonable guess. The scavengers and the wild dogs win again.

SUIT UP: The company that runs the former Hart Schaffner & Marx has set up a quickie, temporary store in the old Loehmann’s space at 151 N. State. HMX Group will stay only for June and will sell suits, ties and other men’s apparel at 70 percent off retail, a company spokesman said. Stanley Nitzberg, principal of Mid-America Real Estate Corp., said a permanent tenant still is being sought for the two-level space.

RETAIL PERKING UP: In a new market survey, the real estate firm Marcus & Millichap points to improving conditions for retail property in the city that has lowered vacancy rates. In contrast, vacancy rates in far-out towns in places such as Lake and McHenry counties are rising, the firm said. It cites “intense bidding” for single-tenant properties leased to big chains.

ACCOLADE LADLE: The 300 N. La Salle office building, a 2009 arrival along the river, won the Urban Land Institute’s 2011 award for excellence in the Americas. It was honored by sustainable development practices, which include its use of river water for cooling, and its financial success. Hines Interests LP developed the building and manages it. Hines sold the 60-story tower in 2010 for $655 million, a square-foot price of $503 that is a record for Chicago office properties.

DOING THE DEALS: Duke Realty Corp. leased the entire 551,000 square feet at its Butterfield 550 in Aurora to Follett Corp, operator of college bookstores, which is moving from River Grove. … Crossroads Development Partners LLC bought out of foreclosure an empty 66,000-square foot office building at 4201 Lake Cook Road, Northbrook, and hired CB Richard Ellis Group Inc. as leasing agents.

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