Attorney cashes in on uncle's turf

Ald. Banks' zoning lawyer nephew behind wave of teardowns, condo projects in his 36th Ward

When you spot all the new condos sprouting up in the 36th Ward, you'll often see a familiar name -- Banks. Not the 36th Ward alderman, William Banks. But his nephew James Banks.

The nephew is an attorney who makes money in multiple ways off the surging redevelopment across the city, but particularly in his uncle's ward on the Northwest Side.

As one of Chicago's top zoning attorneys, James Banks regularly goes before the City Council Zoning Committee, run by his uncle William, and represents property owners who want the zoning law changed on what they can build on their land. James Banks rarely loses a case.

The alderman says he never votes on his nephew's cases.

The alderman adds that he has killed many of his nephew's zoning requests before they ever reach the City Council.

"When you say no to your nephew, it's not greeted well," Ald. Banks said. "But life goes on. My nephew doesn't elect me, the people do."

His nephew has complicated Ald. Banks' life on the City Council. Ald. Banks abstained on roughly 20 percent of the 1,000 zoning cases in the last year because they involved his nephew, and many of those cases were in the alderman's ward.

James Banks has great influence over the development in his uncle's 36th Ward, according to an examination of zoning cases that his uncle did not vote on because they involved a relative.

A Chicago Sun-Times review of those cases found at least 32 properties that James Banks handled in his uncle's ward. An examination showed:

•  James Banks and his wife had a personal stake in three cases. In at least two of those cases, he didn't disclose that fact to the city. They weren't required to do that because they did not have an ownership stake at the time the zoning case was before the city.

•  James Banks and his wife are selling 78 condos and one house, being built after he got zoning changes on eight properties. James Banks and his wife, Grace Sergio, run Sergio & Banks real estate.

•  James Banks hit the trifecta in two cases: He represented the client, has a stake in the development and has his real estate company selling the condos.

One such scenario occurred at 7443 W. Irving Park, where a Leona's restaurant closed to make way for condos.

James Banks and his partners had struck a deal to buy the Leona's restaurant, knock it down and build condos on it. But James Banks and his partners would only buy it if the city would let them put condos on it.

James Banks filed a zoning request with the city in the name of a builder -- Bartlomiej Przyjemski -- who has been involved in several other deals with James Banks. James Banks had not purchased the property yet, so he did not have to disclose his interest.

The city zoning administrator recommended against the project, arguing that putting 12 condos and two storefronts on the restaurant land was "incompatible" with the neighborhood.

But James Banks got the City Council approval he needed, and Leona's sold the land to James Banks and his partners this summer for $1.15 million.

Construction has yet to start, but the condos are already up for sale, according to a familiar blue-and-white real estate sign of the firm Sergio & Banks.

Ald. Banks did not vote on the condo project in his ward and said he had no idea his nephew was an investor.

His nephew is also an investor in a project in Ald. Banks' ward at 8251 W. Irving Park, where a four-story condo building with a store on the first floor is replacing a one-story store. Sergio & Banks is selling the condos, too.

The alderman is quick to step aside and withhold his vote on any matter involving his nephew James or any other relative.

"I love 'em all to pieces, but I don't get involved in their business, and they don't get involved in mine," the alderman said.

The alderman has recused himself more than 200 times in the last year on zoning matters, most involving his nephew James, but a few involving James Banks' brother-in-law, state Rep. John Fritchey, who is also a zoning attorney. Typically, more than 1,000 zoning cases a year come before the alderman's committee, which makes recommendations to the City Council, Ald. Banks said.

The alderman stressed that he has no financial relationship with his nephew or Fritchey. Ald. Banks occasionally uses an office in his brother's Loop law firm, where his nephew works as well. The alderman discloses that relationship on his city ethics form.

Ald. Banks said his staff reviews all of his nephew's zoning cases in the 36th Ward, determining whether the project belongs in the ward. While most of the nephew's cases pass muster with the alderman's staff, he said, "we actually say no frequently."

Ald. Banks said he has rejected about eight projects by James Banks so far this year. Those never made it to the City Council. The alderman said such cases are typically never filed because only recommended projects make it to the Zoning Committee.

"Almost all these matters are predetermined before they get anywhere near the Zoning Committee," the alderman said. "If there's an issue that this doesn't fit with the character of the neighborhood, the nephew is going to know very early in the game."

But James Banks has had far more successes than failures on projects in his uncle's ward.

Since July 2004, James Banks handled at least 32 zoning cases in the 36th Ward that went before the City Council.

In 29 instances, James Banks got what he wanted, permission from the City Council so he or his clients could build lucrative condominium or other developments.

In seven of those cases, the City Council ignored the city zoning administrator, who opposed the developments because they were too dense, didn't fit in with the area or would make traffic worse. The administrator's recommendations are not binding on the Council and are often not followed, Ald. Banks said.

Four of those 32 cases in the 36th Ward are still pending before the City Council.

James Banks, 41, did not return phone messages. He lives on the Gold Coast and has been a member of the Illinois State Toll Highway Authority board since 1993.

Here are a few examples of James Banks' real estate deals in his uncle's ward.

Sergio & Banks is selling 15 condos in the 3400 block of North Narragansett.

But there were supposed to be only four single-family homes there, according to a zoning application James Banks filed last year.

James Banks told the city his clients, Timothy Trezzo and David Hohmeier, wanted to build two homes next to two existing ones they had bought. The land was already zoned for single-family homes, so no zoning change was necessary. But James Banks asked the city to change the property's zoning, a change that would permit condos to be built.

James Banks' clients bought the four lots with two homes on them from Darlene Bazzoli in July 2004, land that had been in Bazzoli's family for decades. Bazzoli, who grew up in one of the homes, sold all of the property for $550,000.

Bazzoli said she got a better offer from Sergio & Banks but sold to the two men. They promised to rehab her childhood home.

Two months after the sale, the two businessmen hired James Banks and got the zoning change from the City Council after it was recommended by the Zoning Committee. Ald. Banks did not vote on the case.

A few weeks later, the businessmen sold the property to Ultimate Developers for $950,000 -- a $400,000 profit in eight months. Ultimate Developers is co-owned by Przyjemski, 26, who is a client and business partner of James Banks. Both are investors in the condos at the Leona's site. Przyjemski declined to comment.

Ultimate Developers tore down the two homes and is building five condominium buildings on the four lots. Sergio & Banks is selling the condos, starting at $249,900.

"I'm not happy about it," Bazzoli said. "Everybody was upset that they were able to get four lots made into five."

The site of Aqua Bella Banquets, once popular for weddings, is worrying neighbors.

The banquet hall on Harlem, just north of Addison, is gone, torn down earlier this month, and in its place will be a five-story building with 60 condos, thanks to a zoning change James Banks won from the city.

Homeowners behind the site fear an already-tight parking situation will get worse with the influx of new condo residents. And neighbors fear it will only mean more traffic for a very busy intersection.

The city's zoning administrator, Thomas Smith, shared their concerns, recommending that the condo project be turned down in part because it was "too dense," city records show.

The project started when Sam Zitella, a well-known developer on the Northwest Side, approached the banquet hall owners, Krystyna and Anthony Cazares, asking if they were interested in selling.

Zitella was willing to pay "the numbers that we wanted," Krystyna Cazares said, but only if the couple could get the zoning required to build condos on the land.

Enter James Banks. He represented the Cazares couple, and he got the zoning change in May. The project is in his uncle's ward, but the alderman didn't vote on it.

Krystyna Cazares declined to say how James Banks came to represent her and her husband.

The deal closed in October, Cazares said.

The shadows loom long and large off the single-family home being built in the 3100 block of North Oconto, just across the alley from a White Castle restaurant.

For years, the land where the house is being built had been a wooded lot.

But the trees came down after James Banks got the City Council earlier this year to rezone the property for a huge house. The house is in Ald. Banks' ward, but he did not vote on the project.

The city Zoning Department opposed the plan because the house "may be out of scale with surrounding homes," according to city records.

"It's a pain in the ass," said one neighbor, who knew a house was going up on the wooded lot, but not one so big.