Even now the structure retains its regal aura. The main office building of the W.F. Hall Printing Company, at 4600 W. Diversey, in the neighborhood called Cragin, is made of old English mission brick, adorned with granite garlands and griffins and stately Doric columns. Inside and upstairs are offices for the president and the senior vice president, each with a shower. Between the two offices is the library, paneled in American black walnut, with quartersawed oak floors. The centerpiece is an onyx fireplace.
It all seems out of place today, given the fate of the factory: the W.F. Hall plant, once the largest printing facility in the world, shut down in 1985. Despite concerted efforts to find another industrial user for the plant, the once-busy work site is now principally the province of pigeons (though the executive offices are patrolled by guard dogs, or so reads the sign out front). Soon much of this imposing building will be torn down to make way for a retail shopping center anchored by a home-improvement-supply merchandiser. Behind this transition from printing plant to shopping mall–and, more to the point, from manufacturing jobs to retail jobs–lies a tumult pitting the citizens of the plant’s northwest-side neighborhood against a seasoned yet haughty developer, his lawyer, and his advisers. The story also involves another developer, who may have lost the chance to keep the plant industrial by winging away on his honeymoon, and a pitched battle between the neighbors and 30th Ward Alderman George Hagopian.
At bottom is a city struggling with new concepts of planning. Increasingly, city officials must decide whether to fight to retain industrial jobs, sometimes at a painful cost, or to bow to the rule of the marketplace when clunky inner-city properties like W.F. Hall go begging for buyers. Basically, the question is whether and when to acknowledge that Chicago is changing from a town of old-line manufacturing to a service economy, losing its high-paying skilled-labor jobs to service jobs at Zayre and Builders Square. The conflict crops up frequently now, most persistently where the upscale north side presses up against the manufacturing pockets along Clybourn Avenue and on Goose Island. The fight over the W.F. Hall plant illustrates the tensions that make the choices so difficult.
The W.F. Hall Printing Company was founded on the south side in 1888 under the name Van Sicklen. Six years later, William Franklin Hall became the president and owner of the enterprise, and gave it his name. The company had a hand in producing early catalogs for Montgomery Ward & Company. Hall died at 45 of Bright’s disease in 1908 in London, where he had gone for treatment. He left a wife but no children, and the company, which was in the process of moving to new quarters at Superior and Kingsbury, passed to R.M. Eastman and E.M. Colvin. Four years later, W.F. Hall Printing occupied the entire block.
In 1925, W.F. Hall abandoned its near-north-side location for a new plant on Diversey. Designed by the firm of Weiss and Niestadt, the new plant was composed of one- and two-story buildings that stretched over 12 acres–742,000 square feet of space. W.F. Hall advertised the plant as the largest printing facility under one roof in the world. Its plum features included the executive offices and, more importantly, the pressrooms. The pressroom floors were made of creosoted wood and rested on a concrete slab over a sand cushion; they were “of ample strength to receive the largest printing presses in the world.” There were 969 cylinder and 132 rotary presses. Skylights in the saw-toothed roof filled the pressrooms with sun, and the system of electric lights on the 35-foot-high ceilings supposedly cut shadows so well that “eyestrain and the resulting fatigue have been eliminated.” Two heavy-duty hydraulic elevators, two cranes able to lift five tons, and three 500-horsepower boilers also served the plant–state of the art for the period.
In the decades after the Diversey plant opened, W.F. Hall prospered. It produced catalogs for Ward’s and Spiegel, paperback books for Bantam and New American Library, and many magazines, among them all the Johnson publications: Ebony, Jet, and half of Playboy. (Hugh Hefner grew up near the W.F. Hall plant, and when he launched his magazine in 1953, that’s where he went for his printing. W.F. Hall agreed to print only half the magazine–excluding the centerfold–mostly as a favor, according to Millard “Lee” Crisp, the longtime power-plant supervisor for the company.)
With prosperity came expansion. There was an addition in 1928 and another in 1951. Eventually, the plant extended from Diversey all the way north to Belmont, and was bounded by the Chicago & Northwestern tracks on the east and by Knox and Kilpatrick streets on the west. The plant enclosed 1.1 million square feet and had 43 truck-loading docks and three railroad docks. There were seven parking lots. Chicago Rotoprint, a subsidiary that sat in the north section of the plant, specialized in fine rotogravure printing. A second small plant on North Normandy Avenue was bought in 1964 for printing and warehousing paperbacks.
But things changed. A contract to produce National Geographic, plucked in 1977 from R.R. Donnelley & Sons, forced some cost-cutting. In the mid-70s, W.F. Hall went looking for cheaper pastures. It opened a plant in Corinth, Mississippi, to take advantage of lower costs in the south. Plants in Tennessee, Georgia, and North Carolina soon followed. In 1979, W.F. Hall was purchased by the Mobil Corporation (also the owner of Ward’s) in a deal valued at $50.5 million. Then Hall lost its account to publish Playboy, a loss Lee Crisp says was intentional. Staid Mobil was uneasy with the racy magazine, says Crisp, and instructed W.F. Hall to weasel out of fulfilling its contract. Playboy Enterprises spokesman Robyn Radomski, however, says Playboy terminated the contract because Hall wasn’t keeping up with technology. The end came in late 1985.
The new plants, the loss of Playboy, and Ward’s decision in 1985 to scratch its catalog spelled doom on West Diversey. In 1985, W.F. Hall moved its corporate offices to suburban Itasca. Then Mobil sold the publicly held company to two other printing giants, the W.A. Krueger Company of Scottsdale, Arizona, and Ringier A.G. of Zurich, Switzerland. The Diversey plant closed down; its workforce, once 5,000, dropped to several hundred.
Before the plant closed, however, word had been widely circulated that W.F. Hall was going to leave the city and place its plant on the market. The messenger was Robert Epstein, W.F. Hall vice president and corporate secretary. “Bob had for a number of years been dealing with the city, telling them that the demise of that facility was coming,” says James Lemonides, executive director of the Greater North Pulaski Development Corporation, on whose board former Hall vice president Robert Epstein sat. “The end, Bob always said, was inevitable, and he didn’t think there was anything he could do about it. Big printing is dying in the Rust Belt; the wages are just so much less elsewhere in the country. There wasn’t a lot of agonizing on the part of the printers’ union, which was aware of what was going on.”
Robert Mier, the director of the city’s department of economic development, knew that W.F. Hall might move a couple years before it did. Mier had been the director of the Center for Urban Economic Development (CUED) at the University of Illinois at Chicago, where he had been an advocate of industrial revitalization and of citizen participation in the process. Mier saw his mission with the city as the encouragement of “traded business”–if companies thrived here, Chicago’s goods and services would be exported and dollars to pay for them would be imported. Because there were few big companies looking for big plants, Mier’s mission centered on helping existing companies expand and on organizing protected manufacturing districts near the Loop and expressways. The most publicized idea was protecting the industries along Clybourn from North Avenue to Webster.
To Mier, W.F. Hall was a white elephant–a narrow (252 feet across at its widest point) building that was too far from the expressways and that had only limited truck access except on Diversey and Belmont. “There is lots of that kind of older industrial space around the city now,” Mier says, “and not much of a market for it.” Mier also says the Department of Economic Development cannot round up buyers for property. “We don’t play the role of industrial real-estate broker,” he says. “That’s a highly skilled function, with segmented markets to consider. In order to have played that role, we would have had to substantially increase our staff.” The city-subsidized Greater North Pulaski Development Corporation, which might have been the natural champion of W.F. Hall’s revival, was wrapped up in trying to resurrect the Playskool toy factory at Augusta and Kilbourn. “We didn’t have the capacity to do much,” admits Jim Lemonides.
With both the city and the local development corporation watching from the sidelines, W.F. Hall went to HTO Real Estate Services, which is based in Des Plaines. The plant went up for sale the last week of August in 1985 with a price tag of $4.5 million. At the time it was the largest industrial site on the market in the city. A caption under a photograph in the plant’s brochure said, “Open space for multiple uses will excite the imagination and ingenuity of leaders in commerce and industry.”
But would it? Broker Timothy P. O’Leary shepherded a number of prospective buyers through the plant, including the leading local industrial redevelopers, but each one decided against the property. Andy Lappin, of Shetland Properties, rehabbers of the old Sunbeam Corporation plant in Bedford Park, recoiled at the creosote coating on the floors, at the lack of parking, and the poor truck access. The truck-access problem also soured Don Shoemaker, president of Hawthorne Partners, the converters of the Hawthorne electrical works in Cicero. “That place was also thin as a string bean,” says Shoemaker.
The fact was that the vision most developers had for W.F. Hall was retail, not industrial, a growing trend in Chicago. Manufacturers are leaving the city, driven to outlying areas and to other states by crushing union wages, whopping real-estate assessment levels (now 38 percent of fair market value on industrial properties in Cook County), burdensome workmen’s compensation charges, high utility rates, the $60-a-head employee expense tax, and crime-ridden neighborhoods. At the same time, retailers, finding the suburbs saturated, appear to be trickling back onto city boulevards.
Statistics corroborate this picture of a changing city economy. Between 1982 and 1988, the number of manufacturers in the city dropped from 6,080 to 5,015–an 18 percent loss–according to the Illinois Manufacturers Directory. Between 1982 and 1986, retail sales in Chicago grew from $10.4 billion to $13.7 billion. Figures from the Illinois Department of Employment Security outline the same trend over a longer period. Between 1962 and 1984, Chicago lost 244,000 manufacturing jobs, while the number of nonmanufacturing jobs (service, research, retail, financial, and real estate) climbed by 372,500.
“We’re not seeing a groundswell in retail sales yet,” says John Coulter, chief statistician at the Chicago Association of Commerce and Industry, “but there have been a few little neighborhood shopping centers opening lately.” In 1986, the city witnessed a population increase of 20,000 inhabitants, which reversed a long decline. That jump causes Coulter to speculate that retailers may soon be appealing to these new residents. Carl Manofsky, a broker at the realty firm of Coldwell Banker, thinks a groundswell is at hand. The successes of retail projects like the Brickyard Mall and the Hawthorne Works, whose retail space was nearly all leased before it opened, have caused developers and lenders to get excited about opportunities in inner-city retailing.
Their enthusiasm includes standing plants, which many developers now see as golden geese. A developer may ask $2.50 a square foot for inner-city industrial space, but if he can afford to convert the property to retail, he can charge $10 a foot. Moreover, says Manofsky, although it is expensive to redo a plant for retail, it’s typically cheaper than new construction.
Naturally, success in retailing requires customers, and the Hall plant had that lure. Or so contended a demographic study that defined the market around the Hall plant in HTO’s brochure. Within a three-mile radius, it said, lived 93,000 predominantly white people with combined family incomes of $36,683 a year. Translation: A relatively densely populated neighborhood of working-class ethnic folk who would be susceptible to base-price or off-price stores such as J.C. Penney or Marshall’s.
The first bid on the W.F. Hall plant was no surprise. Harlem Irving Realty, the owner of Harlem Irving Plaza in Norridge, placed an option on the plant in December 1985, contingent on its zoning being changed from manufacturing to commercial. In May, Harlem Irving let its option lapse, but three other retail-only bids promptly materialized, each contingent on down zoning. One bid was Don Shoemaker’s.
In fact, all those interested in W.F. Hall looked at it principally as a piece of retail meat except one potential diner, John Gates Jr. Born in Philadelphia but reared in Lake Forest, Gates was the son of an investment banker. He attended the tony Groton prep school in Massachusetts, Trinity College, and the London School of Economics. After a tour as an aide to Governor Thompson, Gates became a real-estate broker. In his early 30s, this blue blood set out to make money resurrecting broken-down manufacturing plants in dying blue-collar areas. “We wanted to do properties in industrial areas where people were proud to be laborers,” explains Gates, “where people didn’t find working for a living demeaning and were still proud to do a midnight turn. The people may be unemployed or underemployed now–all the better for their returning to work.”
With a British partner, Gates formed the Capitol and Regional Properties Corporation (CRP) in 1984 and started acquiring plants in Great Britain–in Manchester, Liverpool, and Glasgow–and in the Chicago area. CRP’s first local project was the former Gate City Steel plant in Gary, a 1.1 million-square-foot dinosaur that had opened in 1946, but parts of which had been abandoned since the 1960s. When CRP took over in 1985, says Gates, “half the place was filled with pigeons and crap.” Although unemployment in Gary was high, Gates saw potential: five major steel mills were located nearby and the cost of doing business in Indiana was relatively low. Gary mayor Richard Hatcher and his administration were enthusiastic. CRP subdivided the Gate City facility, paneled it in thick corrugated plastic, and added two new bridge cranes to the existing two dozen. Renamed the Great Lakes Industrial Center, the plant is today fully occupied with steel fabricators of various sorts, who pay rents between $2 and $3.50 a square foot. The Center has just edged into the black. The thorniest problem, says Gates, is convincing incoming executives that they can find a nice enough place to live in the Gary area.
One morning in February 1986, Bob Gannett, a community organizer with the Northwest Neighborhood Federation (NNF), which serves the area around the Hall plant, came across the name of John Gates in a Tribune article on industrial rehabbing. Gannett was delighted both because he had gone to Groton with Gates, and because he thought Gates would be the perfect buyer for the Hall plant. On April 15 Gates, O’Leary, Gannett, and NNF leader Joe Crutchfield trooped through the factory. Gates immediately saw the plant’s defects: the plant wasn’t near the expressways, and securing tax breaks might be more difficult in Chicago than it had been in Gary. According to Gannett, Gates was also worried that the southern section of the plant would prove difficult to rehab. Nevertheless, Gates remembers that he was attracted by the apparent blue-collar labor base. What you see in most directions if you look out from the plant are the rooftops of bungalows.
The NNF was heartened by Gates’s interest because Gates wanted to keep the plant industrial, which meant better jobs. On June 25, 1986, an NNF delegation met with Mayor Washington and Rob Mier to discuss several issues, principally a continuation of the group’s stipend out of community-development dollars. Gannett took pictures of the NNF delegation with the beaming mayor. The subject of W.F. Hall arose, and Gannett handed Washington some literature on Gates, whom he praised. “I think the mayor was excited by what he heard,” says Gannett.
Meanwhile, Gates and his staff were busy determining whether he wanted to make an offer. But events were about to overtake them. The plant’s new owners, Krueger Ringier, Inc., decided to consider a substantially lower price, principally because winter was coming and with it the colossal expense of heating such a huge space. “They were very seriously considering letting the plant go without any heat at all and having the pipes freeze,” says O’Leary. If they had, the spring would probably have brought more problems and an even lower sale price.
Then in plunged a new bidder–Larry Klairmont of the Imperial Realty Company, which brokers property and owns shopping centers in Niles and Waukegan, an industrial site at Elston and Fullerton, its headquarters on Peterson, and an office building in Beverly. Now 60, the brusque Klairmont operates his company with his three sons and a daughter-in-law. He keeps a low profile, which he explains by saying, “I build buildings. That’s all I know. I go and find tenants to fill those buildings. I rely on experts to evaluate everything else for me.”
“I was showing a much smaller factory east on Diversey when I ran into one of Klairmont’s brokers and we got to chatting,” says O’Leary. Klairmont’s broker carried the Hall brochure and some aerial photographs back to his boss. Klairmont immediately liked what he saw; he particularly relished the cheap price. He immediately called O’Leary. O’Leary made a last attempt to contact the undecided Gates, but Gates was gone; on July 26, he had gotten married and was “effectively incommunicado” as he traveled in Europe and Africa on a six-week honeymoon. Klairmont, who wanted the property whether it was down zoned or not, beat out two other bidders, finalizing the deal in late August and closing on it in November. The purchase price, according to O’Leary, was a bargain at $1.5 million.
Because the sale was not publicly announced, when Gates returned from his wedding trip, he continued to nurture his interest in W.F. Hall into the fall. Gates and NNF officials even huddled with Cook County Assessor Thomas Hynes in October to find out whether CRP would be entitled to a substantial tax write-down, under a county incentive that had been designed to help resuscitate factories that had been shut down for at least two years.
News of the sale reached the neighborhood around December 1. Then, just before Christmas, a notice that a request for a zoning change had been filed on the Hall property was slipped into the mailboxes and through the slats of the Cragin bungalows. The request was to lower the zoning from manufacturing to commercial on the southern portion of the site, from Wellington to Diversey. The name on the notice was Edward G. Shenoo’s, a 32-year-old lawyer who had once practiced with Edward Vrdolyak and was now independently representing Klairmont. The rumor was that the plant was going retail, which riled a good many people, even those who had not been involved in community issues. “That December, one of my neighbors brought around a petition,” says Joyce Mika, a mother of three who lives on North Keating. “I thought to myself, my God, the last thing we need around here is another shopping mall. Every place that you look in the city now, there’s another shopping mall. But how many good jobs are we losing for every one in a mall? How much can we shop, for God’s sake?”
On January 6, Shenoo, a talkative, burly man, barged in, uninvited, to a meeting of the Cragin Community Association, an NNF affiliate, that was being held in a cramped living room on Knox Avenue. Shenoo laid out the skeleton of what Klairmont had in mind. The northern portion of the plant would be kept standing for light industrial use, he explained, and the southern part would be razed and replaced by a supermarket, strip shops, and a large anchor tenant. Community anger was thick that night–the prevalent feeling was that the plant should be saved for industrial use. In an attempt to ease the hostility, Shenoo passed his business card to Joe Crutchfield, the controller of a small import company who lives a half block from W.F. Hall and who is also the NNF treasurer and former chairman. “Listen,” Shenoo told the crusty Crutchfield, “we’re glad for your input.” According to Shenoo, Crutchfield replied, “We defeated the crosstown expressway, and we’ll stop you, too.”
Consequently, while Shenoo pressed the request for rezoning, NNF activists worked to stop him. At a campaign forum attended by Washington they pressured Rob Mier to agree to block any zoning change until the community could be adequately heard.
Where did the alderman stand in all this? George Hagopian, a former assistant director of the Illinois Housing Development Authority, has been the full-time 30th Ward alderman since 1975. A regular Democrat, Hagopian, now 67, seems proudest of three things: his family, being the leading Armenian politician hereabouts (Hagopian’s mentions of his background all but overwhelmed his eulogy for Mayor Washington in the City Council), and the amount of business he has helped bring into his ward.
Hagopian says Shenoo, who has known the alderman since he was in his late teens, approached him in late 1986. “Eddie said he represented a gentleman who develops shopping malls,” says Hagopian. “The man wants to put up a first-class mall, Ed said, but they have to get a zoning change or they can’t do it. Then the developer and his son come to see me, and I said, ‘I’ll do anything I can to see a shopping mall go in there.’ Why? Because for two and a half years we didn’t get a nibble. Now here’s this place that’s so huge a thousand people could hide in there and you’d never find them. A girl could get raped. See, we’ve had buildings where women have been grabbed. Nope, when he told me he was going to put in a shopping mall, that was the happiest news I could have gotten.”
Many neighbors, however, saw only the loss of good industrial jobs–a skilled printer draws from $15 to $20 an hour–in favor of low-paying shop-clerk positions. They also envisioned unbearable traffic along Diversey just as there was every time the Marshall Field’s warehouse near Pulaski held a weekend sale. Moreover, the planned retail center was within shopping distance of several other northwest-side centers: Belmont-Central, the Brickyard mall, and the “Six Corners” district at the intersection of Cicero, Milwaukee, and Irving Park.
The NNF and area merchants also agreed that a new retail magnet would be too much competition for local stores. Later, the Belmont-Central Chamber of Commerce and the Portage Park Chamber (centered at Six Corners) came out against a retail development in the Hall plant. In the early winter of 1987, the NNF commissioned a study to bolster the neighborhood case. “We didn’t want to wait for the slick lawyer and the charade of community input,” explains the NNF’s Gannett.
The NNF study, prepared by the proindustrial University of Illinois’ Center for Urban Economic Development (CUED), Mier’s old home, found that within a two-mile radius of the plant there was a close match between purchasing power and retail sales. The study also found that there were already 300 vacant stores in the area. The traffic on Diversey on a Saturday afternoon was already 200 cars per hour more than traffic generated by the Brickyard over the holiday season. The study also noted that as a printing site W.F. Hall had once provided up to 5,000 high-paying jobs; the proposed shopping center would add 776 jobs, probably at an average salary less than half of the manufacturing wage.
Klairmont countered with a retail survey by the Residential Planning Corporation (RPC), a market-economics consulting firm. RPC discounted the university’s conclusion that there were many vacancies in existing shopping areas. It added that the Hall center would add off-price merchandise–something the northwest side had little of–to the mix rather than compete with local stores. Barton-Aschman Associates, a traffic consulting firm, said the added traffic would have “no significant impact on the area land-uses or road network.” Klairmont’s team did not address the loss of industrial jobs.
The zoning change was first considered by the Chicago Plan Commission, an 11-member body appointed by the mayor that makes recommendations to the City Council on large development projects and the sale of publicly owned lands. (Under the Lakefront Protection Ordinance, the CPC’s opinion on significant projects that affect the lakefront is binding.) On March 19, CPC chairman E. Wayne Robinson and two commissioners, Laurina McNeilly and Mary Langdon, listened to members of the community speak about W.F. Hall at a meeting in the Kelvyn Park field house. Part of the evening was devoted to a duel of experts, a tradition in any pending development deal.
Klairmont did not deliver the parries for his side, although his sons Al and Bob watched from the sidelines. “I have experts to answer any questions,” he says. “I’m a guy who knows how to pick up bricks and mortar. At these meetings everybody has a different idea. I don’t go to these meetings. I’m available by phone.” His absence angered many neighbors, who wanted to see the evil developer in the flesh.
In Klairmont’s place was Shenoo, who was assisted by Klairmont’s architect and his traffic and marketing consultants. Together they described their plan for a 250,000-square-foot shopping center and 365,000 square feet of industrial space–all of which would only benefit the neighborhood. The site plans showed that parking and a large retail structure would sit north of Diversey, and behind it, the existing industrial space. South of Diversey would be more parking and a small retail building. “If this center is successful,” said Steven Hovany of RPC, “then other businesses up and down Diversey will be successful. It’s an image thing, and it will continue to keep the retail money within the general neighborhood rather than in other areas where it’s going.”
Shenoo also announced that Klairmont would voluntarily make certain concessions, such as installing a service road to keep truck traffic off side streets and putting up a four-foot-high hedge to hide the parking lot.
Wim Wiewel and Bill Eyring, who oversaw the CUED study, stabbed back with their findings, and Joe Crutchfield, who came representing the Cragin Community Association, said that his group was eight to two against any retail development.
Yet even the neighbors who were allied against Klairmont argued in their statements for complete information about the proposed development. “What is the real truth?” cried Joyce Mika at one point. “That is all we are seeking here. What is the real truth?”
There were also neighbors who seemed to want the shopping center. “I’m originally from Michigan,” said Joe Warda, “and to me there’s nothing uglier than an empty factory. There’s no money going in; there’s no money going out. But there is not going to be any industrial money going in there. . . . It has been empty for two years and if it’s such a prime property, you’d think somebody would have jumped on it already because it’s got to be cheaper than it would be to build a new factory, for God’s sakes.”
At the end of the meeting, Hagopian gave the development his imprimatur, so long as the community received a chance to have its voice heard. Then Hagopian wrapped himself in the flag of family and city: “I’m proud of all of the people of this ward. I’m even proud of the ones who didn’t vote for me, and that’s the God’s honest truth. As I stand here the Lord has been very, very good to me. I’ve got a beautiful wife, seven beautiful children, 16 beautiful grandchildren, and 12,000 people in this ward [his latest electoral mandate was 11,509 to 7,135] that said I was doing a good job and they want me to be the alderman. I will never do anything to hurt a person in this ward.”
Negotiations proceeded between Shenoo, who handled this, too, for the ever-absent Klairmont, and officials in the city planning department on further changes in Klairmont’s design. The city team included Planning Commissioner Elizabeth Hollander and deputies David Mosena and Phil Levin. “Those people were gruesome,” recalls Shenoo. “The community groups had gotten to them, and so they were relentless in their scrutiny of our project. They tore it apart and constantly made new demands.”
Those demands resulted in even more concessions: the service drive would be one-way, not two-way; the parking lot would get more landscaping; Diversey would be widened to accommodate more traffic; and a new traffic light would be installed at Klairmont’s expense. Klairmont now faced $500,000 in additional costs, according to Mosena.
The NNF felt left out because the city didn’t deal it into the negotiations. “Never once did they call,” huffs Bob Gannett. Yet the CPC, in postponing discussion of the issues at its April meeting, had encouraged the NNF to forage around and produce an industrial buyer if it could.
The lack of meetings between the developer’s side and the community deepened their antagonism. Shenoo produces letters to show that again and again he attempted to huddle with Joe Crutchfield and Joyce Mika, to no avail. “Crutchfield was using any means to defeat me,” says Shenoo, who had never been involved in a developer-versus-community donnybrook before. “I repeatedly asked to meet with him, and all I got were declines or no response. Then the Northwest Neighborhood Federation started getting out paper after paper slamming us and George Hagopian for his support.” Mika counters that she and the NNF leaders wanted to meet with Klairmont, not Shenoo, but the lawyer stonewalled. “He said Mr. Klairmont was too wealthy to spend time with us,” says Mika. However, Shenoo says Klairmont had given him carte blanche to schedule a meeting with the neighbors, and on the eve of the May hearing, Shenoo arranged to make Klairmont available. But Mika alleges the meeting was just a setup. The neighbors refused to meet Klairmont and sat down instead with Mosena and mayoral aide Ben Reyes. At that meeting they asked for more time to produce an industrial buyer.
Mika says that at one point Shenoo hinted to her during a phone call that if Klairmont was stalled, nothing prevented the developer from selling the Hall site to the city for public housing. “That’s a filthy lie,” Shenoo says vehemently.
The neighbors were convinced they were being done in by Klairmont and the city. Yet until the CPC convened, Shenoo was convinced that the city was going to recommend against any change in the zoning.
The W.F. Hall matter, item 26 on the agenda, was considered by the CPC on May 16 in the City Council chambers. The planned development was officially an application by a land trust through the First National Bank of Highland Park whose beneficiary was Klairmont. The retail project had been outlined in a five-page handout, put together by the city’s planning department, as two freestanding structures encompassing 267,000 square feet on the north side of Diversey, another 35,000-square-foot building to be built later across Diversey, and 637 parking spaces. Eight CPC members, led by chairman Wayne Robinson, who was a real estate lawyer for Vedder, Price, Kaufman, and Kaumholz, listened to testimony as the hearing stretched through the afternoon and into the evening.
The witnesses testified from a microphone set up in the horseshoe where the aldermen normally sit. David Mosena kicked off the proceedings with an endorsement, if not a ringing one. Mosena’s case for the project was familiar: The plant had been marketed for a long period without finding an industrial buyer, and the developer had made generous concessions to community worries. Furthermore, he said, the city was reluctant to go to the mat over W.F. Hall, since it is not in a major industrial district, nor is it like the Clybourn manufacturing district, which is “multiple industrial sites.” Both CUED and the developer’s studies had “weaknesses in methodology,” he concluded, adding that an off-price store might “fill a void in the market and not threaten existing businesses.” The city recommendation then was to tie the property to a business rather than a commercial class of zoning, a more restrictive class than Klairmont had wanted, but one which would still allow the project to fly.
Hagopian appeared next, discoursing on the general business health of the 30th Ward. “There are many things happening,” he said. “Cragin Bank is expanding, and there’s more and more coming, and we’re very, very proud of it.” He finally came to the subject of W.F. Hall. “I will say this,” he said. “The city and our organization, the Greater North Pulaski Development Corporation, did everything we could to get a tenant or someone to do something with this property. Now we finally got a gentleman who has enough confidence in the city of Chicago to come in and invest $25 million to build a mall there, which we need. Now, we know it’s not a big factory where workers are going to make three, four, or five hundred dollars a week, but the people all around there, in that neighborhood, will be happy to go to work in their spare hours. Some of the women will go there and work three, four, five hours a day and they’ll make $80, $90, $100 a week, which is a lot better than nothing. I’m very happy to say I endorse this.”
Shenoo orchestrated the presentation for Klairmont. “We have met each and every demand that the city and the community has raised,” he maintained, ticking off the concessions one by one. In Shenoo’s version, the project was grander than the outline–290,000 square feet of commercial space, 180,000 for storage and warehousing, and 450,000 for industrial use–yet Shenoo said it could have been worse. Initially, he divulged, Klairmont wanted to turn the whole site into a mall.
Next a parade of Klairmont’s experts spoke. Even the elusive Klairmont testified, under the careful tutelage of Shenoo. Some off-price merchandisers were already considering moving into his center, Klairmont said. “It seems that over the past 18 months, almost every good corner in the suburbs has been developed and there’s been intense competition,” he noted. “There has been a very, very strong renewed interest by all the major retailers in coming into the inner city. And obviously the reasons are the demographics of the high density of population and also the lack of competition.”
O’Leary then described his inability to find an industrial buyer. Then the representatives from RPC and Barton-Aschman and real estate appraiser James J. Curtis Jr. all produced findings that were favorable to Klairmont. Curtis said the plant was ill-suited for manufacturing because it was narrow and was wedged in among homes, which was sure to cause complaints. Even if the plant was razed and rebuilt, he said, the price that would have to be charged to recoup those costs would reach $3.50 a square foot, far more than the going industrial rate.
The case against Klairmont relied on statements by the area chambers of commerce, irate neighborhood residents such as Joyce Mika, and the CUED researchers. CPC commissioner Leon Despres complimented CUED’s Bill Eyring on his study, “You make a very good case for retail saturation.” Within minutes, John Betancur, a CUED assistant professor, was asking the CPC to delay its vote. “We believe that a search for alternative uses of sites such as W.F. Hall is fully warranted,” he said. “We may be giving up too fast, too easy on manufacturing. These sites may be used as incubators, land-banked for a rebound of manufacturing, or be more creatively used without depleting manufacturing space.”
Gates did not show up but his realtor, Carl Manofsky, did. Manofsky detailed examples of local phoenixes born out of industrial ashes–Sunbeam Park, the Hawthorne Works, Gates’s own Great Lakes Industrial Center.
Joe Crutchfield again pleaded for more time to locate an industrial buyer. Alerted that Tim O’Leary would soon leave for an appointment in Oak Brook, Crutchfield beseeched chairman Robinson for an opportunity to question O’Leary. Robinson agreed. Crutchfield then asked whether Gates had expressed an interest in W.F. Hall. O’Leary replied: “In early August Mr. Gates was out of the city on an extended stay. At that time, I knew that the price of the property could be reduced significantly because Hall had made the decision that they were either going to have to tear it down or abandon it. I conveyed that information to an associate of Mr. Gates, and still there was no offer forthcoming. So we could only assume that if there was an interest, it wasn’t a strong enough interest to make an offer on the property.”
The hour was growing late and several commissioners had already left when those remaining began to air their feelings. Laurina McNeilly, a management consultant in her mid-30s, worried about the traffic the project would bring. “I still am concerned that we have not yet expended the sufficient effort in partnership to find creative ways to use the property,” she cautioned. She moved for a continuation and was seconded by Charles Haffner, the vice chairman of R.R. Donnelley, the publisher of National Geographic before it lost the account to W.F. Hall. Elizabeth Hollander, both a commissioner and a CPC member, added that a manufacturer would mean more traffic, too. There were other reservations from the 79-year-old Leon Despres, the former Fifth Ward alderman who was widely perceived as having considerable conscience. “I myself, at this stage, am persuaded that we should keep it manufacturing, and that the retail area is saturated.”
Shenoo was undone. “It’s costing my client $120,000 a month to carry the cost of this,” he told the commissioners. He said he had made every effort to meet with the community, yet was constantly rebuffed. “It’s a closed door in my face,” he said, “and my nose is big enough that it hurts each time.”
McNeilly, Despres, and Haffner voted to postpone the discussion one month. The transcript records “laughter” as the response of those opposed to putting it off. Robinson had in hand two proxies favoring rezoning in favor of Klairmont, but chose to ignore them, voting for a postponement.
“Mr. Chairman,” said an exasperated Shenoo, “at this point, for the record, I would like to state that the proxies, the votes having been cast, that it was the intent of the other two members not to continue this. And I think that their votes–”
“I think that I will make that decision, thank you,” snapped Robinson.
“Yes, Mr. Chairman,” replied Shenoo sheepishly, “I just wanted to raise that.”
Shenoo was devastated. “I felt terrible,” he said later.
Joe Crutchfield and company were delirious. Their cause had been reborn, and the NNF crusade began anew. With its monthly newsletter, the NNF distributed a questionnaire intended to gauge neighborhood attitudes on the dispute. The 1,650 responses showed residents nine to one in favor of strictly light-industrial use. The Cragin Area Business Association also polled its members and produced a similar response.
The poll results in hand, a delegation that included Crutchfield, Mika, and Gannett went to see Hagopian on June 11. The group looked for him at his ward office, then his home, and finally found the alderman at the opening of an office building. “They grabbed me and told me I was going to listen to them,” says Hagopian. “I was trying to give a speech, and they started to pull me out. It really wasn’t the time for this. But they kept saying over and over again that the poll was nine to one for industry. Well, of course it was, but you know nobody was going to take this property. That had been tried.”
According to Crutchfield, Hagopian dismissed the influence the poll should have had upon him, saying, “Twelve thousand people voted for me, and that’s my mandate.” Mika says, “Hagopian looked me straight in the eye, and said, ‘If you had 10,000 signatures, I might consider changing my position, but I want a mall. And if I want it, that’s what’s going to be.'”
Suspicions about Hagopian ran deep. In April, the City Council, by then firmly under Harold Washington’s domination, had voted to reorganize by a vote of 40 to 9. And who should appear among the 40 but George Hagopian, voting to sack his old friend Edward Burke as finance committee chairman. “They sold their souls to Washington for a couple measly jobs and a hollow title,” said Burke of those who deserted him. Hagopian’s title was quick in coming. On May 12, only four days before the first CPC hearing, the rules committee carved out a new veterans affairs panel; Hagopian, who had served as a bombardier-navigator during World War II, surfaced as chairman. He had yielded the gavel of the local transportation committee to Alderman Burton Natarus; now he had a new opportunity to make a difference for the city’s hapless Vietnam War veterans. Or so he says.
The NNF activists beg to differ. “Hagopian got that chairmanship and Washington got his vote in exchange for the city supporting Larry Klairmont,” contends Joyce Mika.
That charge enrages Hagopian. “Harold Washington already had 39 votes for the reorganization,” he argues, “and the opposition had 9. Sure I became the 40th vote. If I had voted against reorganizing, it would have been dumb; I still have to get things done in my ward. Look, I voted for Alderman Burke for over four years. I didn’t miss a vote. But what good would it have done to give Burke ten votes? As God is my judge–and I give most of the invocations down here at the City Council–I never sold anybody out.”
On the afternoon of June 11, the CPC held its regularly scheduled meeting, at which the W.F. Hall matter was reconsidered. Wayne Robinson started by asking Shenoo whether there had been any discussions with community representatives since the last meeting. “No, there have not been, Mr. Chairman,” replied Shenoo, who went on to describe how all his entreaties had been ignored. He had, however, received a letter from the NNF full of untruths. Robinson let the subject drop.
The enmity between Shenoo and the NNF duly established, the hearing proceeded. Klairmont’s experts had reassembled, but the CPC wasn’t eager to rehear their testimony. It fell to the neighborhood activists to state their case. Jane Sobczyk presented the results of the NNF residents poll. “The mall will not be an asset to our neighborhood, not to Chicago,” she told the commissioners. “It will be a detriment, causing more harm than good. We don’t need any more low-paying, no-benefit jobs. The area and the city need higher-paying jobs with benefits that can support our families. These jobs come from industry.”
Next up was John Gates, who glibly described his feat with the Great Lakes Industrial Center in Gary–15 companies roosting in the facility, 1,000 jobs created. He related how he had gone on his honeymoon and missed the chance to bid on W.F. Hall. Was he still interested? he was asked. “We would certainly be interested in taking a second look at it,” Gates responded, “as well as, I think, a number of other developers who do the same thing.” But when Hollander asked whether he could see retaining 450,000 square feet of the Hall plant as industrial, Gates hedged. “I’m not familiar with the PD [planned development]. I don’t know which 450,000 it is. I don’t know what the access situation is, the loading situation, the ceiling heights.”
The poll from the Cragin Area Business Association was read into the record, and then Joe Crutchfield rose. “What we feel makes this case of such importance is the nature of the community,” Crutchfield said. “Our community was described in more poetic terms in a Chicago Tribune article, which portrays the Cragin area as a nuts-and-bolts, hardware-and-dry-goods sort of neighborhood. Nothing fancy or frilly, just functional homes, some light industry, and people who are not afraid to get their hands dirty. We are not the River North or the Goose Island corridor, which are commanding such attention these days in their efforts to retain manufacturing companies. We do not face gentrification; there are no affluent yuppies in our community. I’m told they don’t appreciate the plastic covers we keep on our couches or even the architectural style of the small bungalows we call homes with such pride and which represent the extent of our life savings.
“No, what our community is faced with in this issue is a decision which strikes at the very heart of what our local economy will look like in 20 years. I might add that we could also point to this issue as reflecting what the economy of all blue-collar, working-class Chicago neighborhoods may look like, since Cragin is a microcosm of these neighborhoods.
“The key question we feel is this: Can our community survive by throwing in the towel on manufacturing and shifting our hope entirely to a service economy? Can jobs that pay $3.50 an hour with no benefits and no long-term security provide the economic base for Chicago’s neighborhoods? . . .
“You have heard today from Mr. Gates about the feasibility of manufacturing on this site. Of course, we’re not going to attract one single user for a one-million-square-foot facility. This building is going to have to be renovated and subdivided; millions of dollars are going to have to be invested to do this. But Mr. Gates did it in Gary and that community is reaping the benefits. . . . The people of our community are saying to you today that we want a similar process to take place at W.F. Hall. It will take time, we realize, but we’re willing to look long term, not only short term, and we have confidence that with the combined talents of our neighborhood, an industrial developer, and a concerned city administration, we can enjoy the same success that Gary did. . . . The results of the community ballots suggest strongly that our community is ready to take on this challenge, to try to make Chicago, as one of our neighbors has put it, the city that works, not just the city that shops.”
The CPC determination came quickly. Commissioner Edwin Meyerson moved for approval of Klairmont’s project, and Hollander seconded it. Before the vote, however, Laurina McNeilly repeated her concerns about traffic congestion and the loss of industrial jobs. “I do believe,” she added, “that something is not always better than nothing.” The vote was eight to one in favor, with McNeilly the lone dissenter.
Afterward, the victorious Klairmont walked over to meet Crutchfield. “I told him I respected his opinion,” says Klairmont. “And all I got was a bunch of flak.”
The disappointed Crutchfield knew it was pretty much over. The W.F. Hall decision was headed to the City Council zoning committee, where Crutchfield had once thought he might have a shot at winning if he could enlist committee chairman Danny Davis. One Saturday morning before the June hearing, Crutchfield and Mika had taken the 29th Ward alderman for a tour of the Cragin area, pointing out the glut of retail complexes that already served the community, as well as one to come–a planned addition to the Brickyard Mall called Bricktown. Davis had been sympathetic, but he was unwilling to intervene. “What he said,” Crutchfield says, “is that the only person who can make a difference is the alderman, given that the property is in his ward and every alderman has his pet projects.”
On June 16, the W.F. Hall decision was ratified by the council zoning committee. It was approved by the full council on June 30.
In retrospect, the city planning department and the Plan Commission consider their recommendations on W.F. Hall to have been sound. Though Klairmont grumbled, says Mosena, he agreed to the major traffic-related concessions that were asked of him. The CUED study was viewed as incomplete because it failed to ask residents whether there were purchases, such as off-price merchandise, that took them out of Cragin and into the suburbs. Generally, the CUED study was well regarded, although it did have other flaws. The store-vacancy rate at hubs like Belmont-Central and Six Corners is nearly nonexistent, and Barry Plaza, near Belmont and Pulaski, says that its failure to book tenants–it is now half full–is primarily because it is being selective. “We are just being careful,” says its leasing director, Larry Hearn, who says he recently turned down a 24-hour laundromat because it would draw unseemly patrons.
Some city planners were suspicious that the NNF’s opposition was partly rooted in a desire to keep Hispanics and blacks from flooding over Cragin’s borders from the south to shop. The suspicion seemed more likely given that the NNF championed the plan under which the city would allow a self-taxing fund in certain areas to guarantee the value of homes against depreciation caused by such things as resegregation. “That’s just ridiculous bullshit,” says Crutchfield. “They always try to pin that kind of attitude on our neighborhood.”
But even if there were problems with the center, at least it was something. The city saw no realistic industrial buyer. Gates? “There wasn’t an offer,” says Mosena. “He had been around earlier, but nothing was forthcoming. It’s easy to see how you couldn’t take him seriously.”
It’s not as if the city isn’t willing to block a retail development in favor of an industrial project. In August 1986, the CPC spurned a retail proposal for seven acres at 42nd and Ashland on the planning department’s advice; the old Union Stockyards land later became part of an industrial park. Industrial parks and districts still reflect the city’s thinking. Officials like Rob Mier, since last July a mayoral aide for development issues, and Dave Mosena look kindly on maintaining or linking together factories of between 10,000 and 40,000 square feet that have good transportation and Loop access. “Our policies are geared toward industrial districts,” explains Mosena, “where there is a critical mass of activity, and where there can be a synergy in terms of truck access and sewer needs.” The city has made efforts to pass an ordinance protecting industries along Clybourn Avenue; enabling legislation is pending in the council. The city also wants to establish new modest-size industrial parks, such as on the north tip of Goose Island, near the WGN TV studios, and west of Halsted and Madison.
“We analyzed [W.F. Hall] down to the wire,” says Mosena, “and it was a difficult call. We are not insensitive to the industrial question. It was a close decision for us, a tough decision, and not a happy decision. It doesn’t please an administration to go against the wishes of the community, but sometimes we have to make zoning judgments that do that.”
Wayne Robinson had chaired the CPC for only six months when the Hall matter surfaced. He found it a ticklish call, yet not a close one, and he only voted to defer the question for a month out of respect for his colleagues’ doubts. By June, when no industrial buyer had stepped forward, Robinson saw little reason for the neighborhood will to prevail. “Here you’ve got an industrial facility in the midst of a residential area, with no buyer,” he says. “Should we have let the property remain vacant? The traffic quirks had been ironed out. There was no new testimony in June. The issue became less close for me. But it is bad when you lose good jobs in exchange for jobs that pay half. It’s difficult to make these decisions, but you have to make them.”
Commissioner McNeilly, however, feels differently. “My intent,” she says of her opposing vote, “was to stop this project from going forward. More planning needed to occur, with the community. I felt the project would be detrimental to the existing retail. The city, I think, needs to move toward a policy that provides incentives for industries to stay.” She mentions tax write-downs on the land and federal grants for renovation.
Charles Haffner was swayed in favor of the rezoning by the lack of “a viable alternative.” Moreover, his knowledge of the printing business convinced him that W.F. Hall was a lemon. At the June meeting, he pressed his views on Leon Despres, who also voted for Klairmont. Today, Despres has had a change of heart. “I wished I had voted the other way,” he says. “Now I think retail has to be resisted. If we don’t do that, the demand for residential and retail uses will just jack the prices so high a manufacturer can’t afford to stay. I now think the city has to take a very strong stand for manufacturing. I should have been with Mrs. McNeilly. W.F. Hall was a watershed for me.”
Another watershed occurred in November, when the CPC worked out a truly novel arrangement at Fullerton and the Chicago River. There, Centrum Properties only received CPC approval to build a 250,000-square-foot shopping center where two factories had been after it agreed to construct a new factory ten blocks away on Diversey. Moreover, the new factory is to employ scores of minorities recruited through the Mayor’s Office of Employment and Training. Voting for the compromise was the newly sensitized Leon Despres. McNeilly was absent for the vote; she was on her honeymoon.
John Gates’s CRP is now busy renovating an old Combustion Engineering plant in East Chicago, Indiana, which will be rented out to small industrial tenants. Krueger Ringier, its 1986 annual sales having dropped to $215 million from $241 million in 1984, is set to shutter its paperback operation on North Normandy beginning January 15. Jim Lemonides, of the Greater North Pulaski Development Corporation, says his agency will be helping laid-off workers find jobs.
Crutchfield is still bitter about the W.F. Hall fight and is particularly angry with the city. “People keep saying that we have to bring business back to the city,” he says, “and yet when the city has the opportunity to retain a piece of property in a blue-collar neighborhood, they ignore it; they don’t even try. It’s business as usual.”
Bob Gannett is also angry. “The Washington administration supposedly stood for industrial jobs,” he says. “It was also a goal to respond to the city neighborhoods, and particularly the white ethnic areas. Now, here was an opportunity to work with a neighborhood to attract industry. The fact that the mayor’s people couldn’t pull this together and see the benefits, that was really unfortunate.”
Joyce Mika vows to stay involved in Cragin issues, and she continues to charge that the city’s approval on W.F. Hall was greased in a deal that involved Hagopian. However, a number of city planning officials who figured in the case–David Mosena, Rob Mier, Wayne Robinson, Leon Despres, Charles Haffner, and Laurina McNeilly–all deny there was any pressure from Washington or his aides to lean or to vote one way or the other. “Nobody from intergovernmental relations approached me in a way that would link the vote [on council reorganization] to that item,” asserts Liz Hollander. “There was no discussion with anybody about it. It was handled within the planning department on its merits.”
Nevertheless, Mika has taken the campaign against Hagopian a couple steps further. Late last summer, she led a picket of the alderman’s ward office. She has also helped circulate an “ethics statement” that calls on Hagopian to sign a statement that he has no financial interest in any company that has profited from the W.F. Hall deal. “Why should I sign it?” barks Hagopian. “If you can prove that, you can send me to the penitentiary. I’m not signing anything from Joyce Mika, Joe Crutchfield, or the Northwest Neighborhood Federation.” Hagopian’s required aldermanic ethics statement shows that during the year the W.F. Hall rezoning was being weighed, he neither received any money from companies seeking government action nor owned a capital asset that produced more than $5,000 annually.
To Klairmont, the dispute over W.F. Hall is an old story: The NNF got the Cragin community hopping mad over the prospect of an industrial buyer for W.F. Hall, when the factory was a commercial loser and the buyer was a chimera. Of Gates, Klairmont says: “If he was so great, why didn’t he come forward and make an offer? He was a lot of hot air.”
Klairmont has been proceeding with his dreams for W.F. Hall. He has been negotiating with potential tenants, particularly Builders Square, a subsidiary of K mart that has 118 off-price home improvement stores nationwide, as the anchor tenant for the shopping center he estimates will cost $22 to $25 million to complete. However, Klairmont admits some “confusion” has resulted with Builders Square. “It’s been difficult to work out a price,” he says. “But we expect a deal, and we expect to open in the fall of ’88. This is a go.” Construction is already converting a section of the southern portion of the plant into a mini warehouse and the basement into a garage for storing classic automobiles and recreational vehicles. There have also been meetings with possible light-industry tenants and distributors. Much to Klairmont’s irritation, gangs have vandalized the building, pulling out plumbing and smashing windows. Hence, the guard dogs. The presses are gone. Lee Crisp, the power-plant supervisor for W.F. Hall, now oversees the facility for Klairmont; he can often be found patrolling the floors in an electric golf cart.
But the long-running dispute between Klairmont and his new neighbors may not be over. In late October, residents of the bungalows on Knox Street, which is immediately to the west of the far south section of W.F. Hall that has been razed, received a notice that a request for rezoning from manufacturing to commercial was being lodged. The name on the bottom of the letter was Edward G. Shenoo. Klairmont now wants to build a Chicago Health Club on the property. Irate neighbors have been besieging Shenoo’s office with calls. Since the rezoning request is for a small property, the matter is headed not to the CPC but to the City Council zoning committee.
Art accompanying story in printed newspaper (not available in this archive): photos/Jon Randolph.